There’s a change in the wind on the high seas and there are choppy waters ahead for the financial services sector. Many of the traditional stalwarts are being forced to re-evaluate their business models, to come to grips with disruption from within the sector and from non-financial services companies such as Apple. They are also battling consumers’ rising expectations and growing thirst for digital products.
Now the sector needs to better engage with new and existing customers to steady the ship. For many, this means implementing intelligent technology to remain competitive and relevant. Recent findings from our research suggest that efforts are being made but, in the face of such disruption, how can financial services companies cement these relationships, drive loyalty, and prevent valuable customers from jumping ship?
Navigating the choppy seas of disruption
Market disruption is coming from all angles. With non-traditional companies like Apple entering the space with products including Wallet and Apple Pay, brands that consumers relate to on a completely different level are suddenly having an impact on financial services. In fact, some banks received a lashing over their resistance to adopting these new technologies, including Apple Pay. In this case customers took to Twitter to broadcast their displeasure that they didn’t have access to the service. Now, even the most reluctant are finally joining the fleet.
Equally, new kids on the block like digital-only bank Atom, customer-centric organisations such as First Direct, as well as peer-to-peer lending with the likes of Zopa, Funding Circle or Ratesetter, are all rocking the established financial services status quo.
With regulatory authorities starting to dissolve the legacy barriers preventing customers switching accounts and services such as uSwitch making it quicker and easier than ever to change providers, stalwarts of the industry have had to sit up, take notice and change tack as valuable customers jump ship.
In order to drive loyalty with customers, it’s crucial that organisation keep pace with consumer trends and demands, as well as their nimble competition. Beyond this, companies need to be proactive in their engagement with customers; what are the services they want and how can you deliver them.
Building trust while riding the digital wave
Nevertheless, while consumer thirst for innovation and new services continues to run high, top of their list of concerns is their personal data – namely how is their information used and is it being kept safe. We recently conducted global research that revealed that only 43 per cent of consumers trust banks to keep their data safe. This figure drops to a pitiful 10 per cent when consumers are asked about their faith in insurance companies, and as low as 7 per cent for credit card companies.
Financial organisations are working hard to instil consumer faith, but there is clearly a way to go. Given the nature of their business and the sensitivity of the data involved, companies across financial services should expect, and strive for, a far better customer experience. As data plays an increasingly integral role in every customer interaction, it is vital that organisations are transparent with how they are using their customers’ data and continually educate the public on this subject.
The technology sails billowing in the wind
Our research also found that banks were by far the sector most likely to lose customers as a result of mistakes – 22 per cent of consumers would jump ship to another provider as a result. As consumers become more demanding and expectations rise, that definition of 'mistake' widens, and financial services organisations need all hands on deck to keep up with their customers.
To survive on the financial services high seas, banks need to ensure that customers are put first across the entire organisation. They must employ the right people with the right skills who can support and implement this strategy, and they have to be supported by the right technology.
When properly harnessed, technology can be the sail that helps the front line crew drive the company customer experience forward. It provides the tools and knowledge at their fingertips to solve customer queries quickly and provide the personalised and efficient service that they crave. Without this, in the turbulent waters of customer expectation and industry competition, customer service staff could find themselves constantly sailing against the wind.
By listening to customers and staying ahead of the curve on technological innovations, financial services organisations won’t just meet, but can exceed consumer expectations, drive valuable loyalty and prevent customers from jumping ship to more forward thinking competitors.
Michiel Lely, VP Practices EMEA, Verint Systems