Banks have long championed customer service as a strategic priority, but their focus on product development and cross-selling has tended to relegate the customer experience to below their bottom line.
That’s a mistake. In a skittish and increasingly competitive economy, bank customers are all the more hungry for personalised solutions. Throughout the APAC region, a raft of flexible financial service organisations have forced traditional companies to reassess how they address customers’ needs in an age of digital empowerment and heightened expectations.
Here are some of the ways banks are attempting to keep up with the changing marketing climate.
Tenacious, Integrated View
Banks are “taking a deeper look” at customers’ overall financial well-being to come up with more personalised products, according to Jenny Wilson, national lead partner at Deloitte’s Customer Practice. However, the challenge many banking and financial-sector CMOs face is that product design and marketing processes remain highly siloed.
Wilson stressed that a customer-centred design model requires a whole-bank response, rather than fragmented initiatives, and a preparedness to review existing processes, consider new business models, and factor in customer feedback.
A focus on customer outcomes, Wilson added, requires defined goals in terms of the customer’s engagement with the bank’s offerings. Additionally, these goals need to be measured by all levels of the organisation.
In this setting, “Products are not sacrosanct–they are readily refined, turned off, dismantled, and rebuilt through interacting with customers and monitoring their behaviours daily,” Wilson told CMO.com.
Adopting this “tenacious and integrated view” across the organisation builds trust, provides a customer experience “that doesn’t feel like a set of transactions,” and enables customers to better manage their finances and make more informed decisions, she said.
Call For Bravery
Can CMOs from more traditional financial institutions count on the internal will or organisational agility to embrace and successfully implement personalisation? It won’t be easy, Wilson admitted.
“It requires having the bravery to make not just incremental change but, where it’s warranted, fundamental change,” she said. “Fin-techs are much better at responding to customer needs. They understand the importance of building trust with customers. ... Personalisation is about building a relationship based on trust–trust in how a bank engages and trust that the bank is always interested in the customer.”
According to Mark Crowe, managing director of Brand Finance Australia, banks are uniquely positioned to build such relationship with their customers.
Retail banks have previously taken a multichannel approach to banking. But with the trend to “branchless banking,” he told CMO.com, the focus has shifted to having an omnichannel presence with the ability to conduct all banking activities, seamlessly, across any device.
“For the banks, this is a great opportunity to really understand their customers, streamline systems, and focus on the most profitable areas. From the bank’s perspective, a joined-up, 360-degree view of all of their customers’ activities offers clear benefits,” Crowe added. “By leveraging the information they receive from the various channels, they can build a detailed customer profile and tailor services accordingly. They can then sell relevant and personalised financial products.”
The trap, however, is incorrectly assuming that every customer demands a deep relationship and more frequent engagement. What customers usually want, Crowe said, is “a more personalised service that provides convenience and relevant information at a time of their choosing.”
The benchmark for banks is to be as good at personalising product offerings as the best personalisers in the business: retailers.
Katrina Bradley, a partner in Bain & Co.’s Customer Strategy & Marketing Practice, said Australian banks have been on a “gradual path towards more granular customer segments.”
“Ultimately, the key is relevance,” she told CMO.com. “What you’re trying to do [as a bank] is customise a product or service in a way that is highly relevant to a particular customer. The challenge is making sure that personalised service and sales offers are not just creating noise.”
In theory, at least, access to rich data streams enables financial-sector CMOs and product development teams to more accurately target product and service offerings.
“Banking has had the transactional data; now they’re able to overlay that with behavioural data, integrating lots of different data sets and draw insights from them,” Bradley said. “The risk is that customers start to be bombarded with messages that are not relevant to them. When a customer opts out [from receiving marketing communications], it’s hard to get them to re-engage.”