This article was written by Larry Augustin, CEO of SugarCRM.
The financial services landscape has changed vastly from what it was 20 years ago.
Now, the industry — like so many others — is defined by digital. Digital technologies have made perhaps the greatest impact on how banks communicate with their customers. For example, email and phone, once the primary mediums of communication, are now taking a backseat to other channels that offer personalized experiences in real time, like instant messaging, mobile applications, websites and social media.
In fact, according to a recent Frost and Sullivan report, almost one-half of financial services customers use three or more communications channels in a year.
However much better the digital revolution is making the customer experience, it’s also creating significant difficulties for banks, credit unions and other financial services institutions. Why?
Now, the customer experience is the differentiator among competing entities: Gartner research shows that 89 percent of companies compete solely based on customer experience. So, financial institutions must provide customer journeys that are personal, unified and memorable to stand out from the competition. They must concurrently increase their customer numbers and retain their current customers, who are more engaged and knowledgeable than ever before.
Meeting customer demand is paramount in every industry. But the global banking sector’s reputation for lack of commitment to customers makes meeting customer demand especially critical. This, in addition to the fact that digital communication makes it easier and less burdensome for customers to switch companies, provides a clear imperative for financial companies to figure out a way to use the digital world to their advantage.
Given this landscape, what can financial institutions do to remain competitive in the digital age? And, is there really a modern-day equivalent to meeting in person for customer retention?
The answer lies in fine-tuning the customer journey: plan the customer journey, and align your business operations with the average life cycle of your customer.
One way to do this is by conducting an easy customer journey exercise. Start by identifying how a customer typically makes a purchase, and examining the customer life cycle and interactions with the company. This will provide insight about where your company is not meeting customer needs.
At the end, the customer journey exercise will become a best-practices document, and can be used as a resource throughout your entire company.
Social media has made it critical for all businesses to truly understand and know their customers. Getting there requires extensive research and a deep knowledge of your customer base.
Customer relationship management technologies help companies navigate these new channels, and provide customer services teams access to all customer information in context to fully understand a complaint. Having all the facts associated with a situation or account is critical to providing great customer service.
A customer service representative, for example, will be more effective handling a complaint when he knows whether a purchase is from a loyal customer and whether a customer prefers to communicate via Twitter or Facebook.
Diving in to the digital age doesn’t mean human interaction must be discarded. It’s still important to actually talk to customers. It just must be relevant.
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Combining digital technologies with human touch points is the best formula for providing context and creating a unique customer experience. Meeting customer demands in today’s digital age requires companies to dedicate themselves to research and planning.
Incorporating these new digital and social methods is necessary to make financial services organizations more agile, quicker to respond, and better able to provide a unique and personalized customer journey across all channels — the ultimate goal of customer service.