December 10, 2012

Based on the results of the survey, it sounds like the significant investments banks are making in customer analytics are paying off in their ability to target/customize. Do you think that is the case?

Wollan: Overall this is true -- consumers rated most customer service attributes higher across the board this year, with a significant increase in use and stated influence of corporate web sites as well as online expert review sites, news sites and product comparison sites. This all suggests growing impact of digital channels -- areas where some banks have made significant investments in online, mobile, analytics, and social media. The key message for banks is to keep up the pace, as consumer expectations continue to rise. For the third year in a row, we have seen a double digit rise in consumers saying they have "Much Higher" expectations -- if banks and other companies slow down their focus on these functions, they may quickly find themselves out of touch with consumer expectations once again.

One area banks could build on their past investments to create even more impact with consumers is with the rise of service personalization -- providing more options for obtaining service or more specialized treatment for being a good customer. Expectations for these kinds of services are moving up the rank among consumers, while interestingly, the expectation that customer service representatives will be increasingly knowledgeable continues to fall off.

Did the survey address privacy concerns -- that is, is there a limit to how much personal information people are willing to share with a financial services provider and what the bank can do with it? What trends are you seeing in this regard?

Wollan: Yes, most definitely. This was a new area of focus in this year's survey. The findings indicate that customers are willing to provide their data, but they expect something in exchange for it. Our key take-away is that consumers really care about how their personal data is used: They expect providers to create more relevant offers and services based on insights, but also want to trust that their data is secure and have some control its use.

"Realizing that the company cannot be trusted on how to use personal information I provided them" and "Realizing that the company is not using the information it has about me to make interactions and offers more relevant for me" are key frustration for consumers dealing with all industries and encountering them even while prospecting leads consumers to not consider doing business with the service provider in any industry.

Do you have recommendations for financial services companies as to how they could rank higher/improve how consumers feel about them? Do you see any risks -- competition, regulation, economic conditions, etc. -- that might cause their rankings or performance to decline in this area?

Wollan: Here are four key recommendations:

  • Focus as much time on setting expectations (marketing, selling) as is spent meeting those expectations in service. This is a major gap that can lead to unsustainable levels of attrition as a result of broken promises (e.g., sales messages that create unsolvable service issues).
  • Start thinking of each misstep as a chance to lose a customer -- customer service failure is more than just frustrating for customers. Consumers won't always give you the chance to save them by talking to a supervisor -- one in five indicate that their first reaction to poor service is to either quit doing business with the company immediately or begin shifting a portion of their spend to another provider.
  • Turn listening to "active listening" to your customers. Not just when they escalate or get moved to the "save desk" -- but all the time. The vast majority -- 85 % -- of consumers state that there is something their service provider could have done to save them … they just had to be aware there was an issue and make every attempt to fix it first time around.
  • Treat different customers differently. Defining the micro segments that are at risk and what the appropriate treatment is to save them is an approach that has been incredibly successful in wireless and can be extended to banks. Protect your existing customer base with this type of analytically driven approach.
ABOUT THE AUTHOR
Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & ...