CX Optimization: Creating a Strategic Advantage in Banking

With banks, credit unions, and fintech providers placing so much attention on banking technology today, it’s easy to focus solely on the features and forget about the importance of the human interactions that create memorable experiences. But financial institutions and their partners who neglect the underlying customer experience do so at their own peril.

When speaking about customer experience, it’s important to note that it is more – much more – than simply a discussion about user experience on a laptop, or reviewing responsive design on a mobile device, or remembering to smile when greeting a customer or prospective customer.

Creating a best-in-class customer experience requires a deep understanding of customer wants and needs, as well as the manner and frequency of interactions to create an outstanding customer experience. Often, a key component in understanding customer experience drivers is the use of mystery shopping and voice-of-the-customer information. This insight can offer enlightenment into factors that can foster customer engagement.

And these dual CEs – customer experience and customer engagement – are typically the foundation of deep and lasting customer relationships. They are the foundation from which long-term banking relationships are formed.

Understanding and building on this important point, an increasing number of financial institutions are making customer experience a critical component of their branch reconfiguration, digital banking, and omnichannel banking initiatives. Many progressive banks and credit unions are taking customer experience factors into consideration as important components of product and process evaluations. This doesn’t mean that return-on-investment and other financial considerations are passé, but increasingly, cost savings efficiencies are being measured against customer experience and engagement.

One example of the types of programs being used today can be seen by at ath Power Consulting, which has developed a Customer Experience Optimization framework to help banks identify ways to deliver consistently high levels of customer service. Within this framework, ath Power offers a Customer Experience Index (CEI) which identifies key satisfaction drivers and aligns them with specific behaviors, expected service levels, and action items.

One financial institution used this methodology to develop an ideal customer experience platform. This platform was used to measure and monitor the organization’s front-line and back-office staff, and compare with company customer experience objectives.

Key results included a realization that customer service levels varied significantly across the organization; an understanding that 40% of new account openings were the result of referrals by friends or family members; and that almost two-thirds of customers who had closed accounts did so because of dissatisfaction with their overall banking experience. With this information, the institution was then able to develop appropriate action plans and monitoring procedures.

While the realization that an outstanding customer experience is the foundation for happy and loyal customers and members is not new, doing so today is becoming increasingly difficult. Banking customers today have a broad frame of reference with which to assess satisfaction, and often compare their retail banking interactions with the high levels of customer experience offered by high-end retailers.

This is a key reason why industry leaders have a heightened sense of urgency to improve and optimize their institutions’ customer experience performance. They realize that their institutions need to create an outstanding customer experience if they wish to thrive in today’s hyper-competitive, consumer-oriented marketplace.

 

Contact ath Power Consulting

For more information on this topic, please contact the author, Ed O’Brien.  Mr. O’Brien is EVP, Research & Strategy at ath Power Consulting.  He can be reached at eobrien@athpower.com.

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