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  • Phil Britt

How Financial Services Compete on Customer Experience

Financial services firms have long competed with traditional sources, like other banks and credit unions for customers. But starting in the '90s, financial services faced new competition in the form of “non-bank banks,” such as Quicken Loans and PayPal, to name a few.

The price differentials between the competitors is minuscule, if it exists at all, so traditional financial services firms have turned to customer experience (CX) as the way to retain current customers and to attract new ones — or risk losing out to competitors who provide better CX. A report from research firm Kantar noted that those financial institutions that lead in customer experience (CX) have higher share of deposits as well as a better chance of cross-selling other products and services to their current customers.

Digital, Self-Service Options Provide Preferred CX

“Today, great customer experience is being negotiated at the limits of self-service inside digital channels. While automation and artificial intelligence have dominated headlines in recent years, companies are beginning to understand and appreciate the difference between 'personalization' and personal,” said Lee Wetherington, director of strategic insight at Jack Henry & Associates, Inc., a provider of technology solutions and payment processing services primarily for the financial services industry.

“Personalization” typically refers to data-analytics applications that provide more relevant information and real-time context for individual customers online. Recent research, however, finds that customers’ preferred form of personalization is not algorithm-curated purchase journeys or targeted ads, but human support by competent staff who know the customer’s preferences and recognize the customer’s loyalty, said Wetherington. In short, consumers (especially younger consumers) prefer "personal" human support over the “personalization” of data applications.o financial institutions must translate their personal service effectively and meaningfully into digital channels by incorporating secure, encrypted, fully authenticated chat that secures trust and encourages candor, Wetherington said. “Doing so creates opportunities for smaller companies to differentiate themselves against large corporations and 'bigtechs' who can’t scale personal service. Have you ever tried to call someone at Facebook or Google?”

Good Content Helps Improve Customer Experience

“Content is critical to helping you gain organic visitors,” said Credit Union of Texas CEO and president, Eric Pointer. So CUTX started focusing on content in April 2018. Within three months the financial institution saw an increase in Page 1 rankings by 23 percent, while keyword ranking increased by 503 percent, results that Pointer called “good, but now good enough."

“Organic rankings are an ongoing fight to stay on top and unless you rank on Page 1 it doesn’t matter," Pointer said. “Our fight to stay on top led us to a new website because our site structure was holding us back from massive gains in organic visibility. Our new website will launch April 2019.”

Improved CX from Employee Technology Support

Under the theory that incenting employees will help them provide better CX to members (what credit union customers call customers, since they are all shareholders), the credit union also instituted an executive dashboard to automate an incentive program.

CUTX was using excel spreadsheets to calculate organizational incentives in multiple departments, which took hundreds of hours to complete each month, according to Pointer. Through data integration and leveraging the CRM system, CUTX was able to automate the entire incentive program with automated emails that provide a link directly to the respective team's incentives, an automated hierarchical approval process that enables the manager, then vice presidents to approve and finally passing incentives to Human Resources. This process not only saves hundreds of hours, but also provides historical tracking for audit and compliance. The new process also provides trendlines and leaderboards for better coaching opportunities and human resource documentation. And most importantly, it will provide employees daily dashboards so they can reach their goals.

Knowing Customer Needs to Improve Customer Experience

USAA, a credit union that serves current and former members of the armed forces and their families, communicates with members via the phone and online, relying on employees, many of whom are former armed forces members themselves, to connect and empathize with member needs, one of the reasons USAA topped the Kantar CX rankings for financial services firms. By focusing its digital technology and phone conversations to uncover member needs, USAA provides them with relevant products and services. Kantar said that 83 percent of the customers/members of CX leaders said their financial institutions presented them with relevant advice and products.

“USAA is more than a bank. They want to make sure members get what they want in life, want to take care of you,” a member told Kantar. USAA relies on its members to improve its knowledge of them and its CX. In addition to the digital technology and phone interviews, 43 percent of USAA members were asked for feedback. According to the Kantar report, only 26 percent of financial institutions with poor CX seek customer feedback.

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