It’s been almost a year since the announcement of two significant pieces of legislation which seek to empower customers in the UK. In September 2015, the Open Banking Standard working group was set up at the request of HM Treasury to explore how data could be used to help people transact, save, borrow, lend and invest their money. In essence: provide greater transparency between the customer and the banking options available to them.
In the following month, the Consumer Rights Act of October 2015, billed as the ‘biggest shake-up’ in consumer rights law in a generation, was introduced to offer UK consumers more rights and protection after they’ve purchased goods and services, than ever before.
Both of these pieces of legislation heralded the dawn of a new era of the empowered customer, with efforts being made to improve the experience consumers have with banks and businesses by providing a clearer and more efficient service.
With the Open Banking initiative set to be implemented by the end of Q1 2017, the countdown is on for banks to ensure their technological infrastructure is equipped for the transition. But getting the basics right is essential to ensure a future-proof customer experience strategy. It seems the benefit customers will see from the new legislation can’t come soon enough; the July 2016 release of the UK Customer Satisfaction Index (UKCSI) revealed banking is the only industry in the survey that hasn’t improved its rating for customer satisfaction in the past year.
The days of a one dimensional customer approach are gone. Financial businesses now need to be able to deliver experiences that feel personal, unified and memorable if they are to stand out from the crowd. A point that has been reinforced by Gartner research, which found 89% of companies think they now compete solely on customer experience. This gives the financial companies a double challenge: growing their customer base in the first place, and then finding the correct solutions to meet the needs of their current customers who are more empowered, educated and connected than ever before.
So what can banks do to best manage this shifting dynamic?
- Be available 24/7
Customers expect consistent, helpful and personalised communication from the companies they choose to do business with and, if they don’t get it, they are prepared to take their business elsewhere. A culture of immediacy has developed. Businesses are under increased scrutiny and pressure to adapt in order to meet the demands of a marketplace that is increasingly centred around technology, mobility and social media. So, if a customer tweets or emails you, respond within hours (or minutes if you can). Banks that ignore the needs of the modern consumer will lose customers and the bottom line suffers.
- Use social to better understand your customers
Today’s customers are digitally-savvy and multichannel and they expect their banks to be the same. A report by Frost & Sullivan found that almost half of financial services customers use three or more channels in a year. Social media platforms in particular have revolutionised the way customers engage with banks. Customers now have a number of channels on which to immediately – and, crucially, publicly – communicate with their banks. This means banks need to constantly monitor what is being said on social media in order to deal with customer grievances and ultimately protect their reputation. Customer Relationship Management technology is helping banks keep up with these developments. By capturing information across multiple channels and platforms, customer-service teams can have all the information they need at their fingertips to build a complete picture about the situation surrounding the complaint. When it comes to customer service, access to information is a life saver.
- Don’t forget the human touch
In a Which? report last year, 53% of consumers cited friendly and helpful staff as a good example of good customer service. Simply put, human touchpoints matter: a recent McKinsey report notes that only 80% of businesses rely on a combination of digital and human touchpoints to conduct their business. Ultimately, people still want to talk to people. We just need human interaction that’s relevant. Connecting the digital and human touchpoints is what’s important, as well as giving customer service/sales reps context on what digital interaction customers have already had with your brand. That’s the new challenge.
With enhanced consumer rights and an increasingly competitive marketplace, customer engagement is becoming the true differentiator in many industries – far more so than price or product features. Meeting customer expectations in any industry is a key business principal but in the global banking sector, an industry notorious for low levels of loyalty – it carries even more importance. With the Open Banking legislation set to reduce the amount of barriers and effort for customers to switch banks, it’s more important than ever that they step up to provide a great experience.
Today, meeting customer expectations requires total commitment and focus. Implementing the points mentioned will increase a business’s agility to anticipate a customer’s needs and their ability to offer an engaging experience across all platforms. This, the holy grail of good service, will put businesses in a positon to be richly rewarded by its satisfied customers.