By Scott Andrick
In today’s digitally connected world, the rules of customer engagement have changed. Customers expect interactions with banks—from marketing emails, to loan applications, to account inquiries—to be seamless, straightforward and customized.
No matter what channel a customer communicates through, whether in person, online or phone, banks need to understand customers well enough to deliver the best service possible.
Customers are more empowered than ever before. As a result, they want consistent, efficient, and personalized service experiences. If they don’t, they will look to a new bank or fintech provider that will.
A recent survey by Pegasystems of more than 1,000 participants—both consumers and retail banking decision makers—indicated nearly one in four consumers would start looking for a new bank if they received poor customer service, and one-third indicate customer service is the most important factor when considering switching institutions.
So, what are the areas of improvement for banks to better meet customer expectations and retain customers?
For the empowered customer, service goes beyond banks providing cookie cutter responses to an inquiry. If a representative speaks with a customer and repeats standard recommendations that are unhelpful, or lacks insight into what the customer was doing on other channels that drove the service request, the customers feel as though the bank doesn’t understand their needs and their time has been wasted.
A critical part of service becomes personalization—when service representatives interact with customers, they need to reassure customers that they understand their history with the bank and quickly provide them with relevant, valuable interactions.
The survey revealed that retail banks are missing a few key opportunities to provide deeper personalization during customer interactions: only 14 percent of consumers feel banks excel at delivering personalized service. Banks acknowledge the struggle; more than one-third admit their main problem is delivering a general customer experience that does not factor in their customers’ history.
At the same time, banks and consumers recognize the importance of quality customer experiences, though there remains a sizable gap in perception regarding how well banks think they know their customers. While more than two-thirds of banks believe they understand their customers on an individual level, less than half of consumers agree, emphasizing a disconnect.
What factors can explain this gap? To start, banks may be investing in the wrong channels for customer interactions. According the survey, the vast majority of customers (72 percent) interact with banks face-to-face, but 70 percent of banks think more online chat agents would provide a superior customer experience.
Consumers are less interested in online chat; only seven percent view this as offering the best service. The nuances and complexities of customer inquiries can get lost in online chat, causing service delays and misunderstandings, which is why customers prefer not to use it. Chat works for basic inquiries, but banks cannot forget the importance of investing in true human interaction channels, such as face-to-face at a branch, or customer service representatives at a call center. These channels provide frictionless, personalized experiences customers crave when self-service channels fail.
This discrepancy between what banks are investing in and the channels customers prefer indicates a disconnect between what customers want and what banks are delivering.
Another factor is the threat of digital disruptors, which traditional banks need to consider for their customer experience strategies. Even though one in three consumers would consider these new, innovative banking providers in the future, 60 percent of traditional banks remain only a little worried or not worried at all about these disruptors. Two-thirds of banks still view their main competition as other traditional banking institutions, reflecting a lack of understanding of evolving industry threats.
The good news is that these factors impacting customer satisfaction are surmountable. With technology that enables a true, omni-channel experience, banks can form deeper relationships with customers. This means each interaction will be informed by the customer’s full history and preferences, so banks can provide specific, relevant information the customer finds useful.
In doing so, banks will create better customer experiences, and can avoid becoming obsolete in the age of empowered customers.
Scott Andrick is the director and industry principal of retail banking and consumers payments for Pegasystems, Cambridge, Mass.
Online training in digital, mobile and social media from ABA.