By Joseph Salesky, ClairMail
Today's business and technology climate has disrupted customer relationships for banks, making it harder to retain assets, acquire new deposits, cross-sell products or obtain new customers. Customers are feeling the need to stay connected to their accounts, but that is driving up the cost to service them.Traditional bank customer interaction channels are "customer reactive." Whether they have an inquiry or require service, customers must initiate contact with the bank-such as calling a contact center, dialing in to an Interactive Voice Response (IVR) system or logging on to the bank's website. Such customer-reactive transactions are expensive for the bank, as they incur high staffing, telecommunications and network infrastructure costs.
To restore disrupted customer relationships and create opportunities, banks must adopt a proactive approach to customer interactions.
Two channels have emerged as clear first steps for banks to proactively engage with their customers: mobile banking and Twitter. Several innovative banks have embraced these two vehicles in order to establish a line of direct, proactive communication with their customers.
Proactive Mobile Banking to Control Customer Interactions A mobile phone goes with its owner everywhere at all times, and is inherently a multi-channel, multi-functional communication device. Between voice, SMS, mobile web and downloadable apps, the ways to communicate are numerous. SMS alerts are particularly useful for enabling banks to leverage the dynamic, real-time capabilities of the mobile channel. Via SMS alerts, banks can proactively generate and send critical, time-sensitive, account-specific information to their customers, and empower customers to easily and instantly resolve issues.
This information can be highly personalized: your account balance is low, you have a bill payment due, or there is suspicious activity on your credit card. Importantly, with proactive mobile banking, alerts are actionable. The customer can instantly address and resolve the issue by responding to the alert, either through a secure and immediate "handshake" or by initiating a longer-running, personalized and interactive workflow or "conversation."
For example, proactive mobile banking allows the bank to send an actionable alert to a customer when a potentially fraudulent transaction occurs; the user can approve or dispute the transaction with a simple text reply, and the bank can follow-up with a contextual marketing message promoting its credit card protection service. By leveraging mobile alerts, banks can realize tremendous savings by deferring costs from contact centers or IVRs. According to Javelin Strategy & Research, the all-in cost for an SMS text message is approximately 2.5 cents per message, which is less than one-tenth the cost of a call to an IVR and miniscule compared with a call to a contact center ($14 to $18 per call).
Real-time engagement, personalization, cost-savings and cross-sell opportunities are all hallmarks of a proactive mobile banking solution.
Twitter As A Customer Service Tool Recently, banks such as Bank of America and Wells Fargo have begun offering real-time customer service via Twitter. Each account is an actual person (David Knapp for Bank of America, and Ian and Ruby for Wells Fargo). It's a face, a personality for people to interact with in conversation. As Twitter grows dramatically, it has become a forum for people to air their grievances or submit suggestions, and a way for banks to gather a massive amount of useful customer sentiment information.
Just like mobile, Twitter is a real-time, personalized medium. There is the engagement of back-and-forth messaging, and Ian, Ruby and David's messages are largely to individual people addressing their issues. As a customer service tool, Twitter's 140-character limit actually makes these interactions very streamlined and simple. When more effort is required to resolve a problem, it can easily be escalated to e-mail or a phone call. In fact, it can be argued that Twitter, like mobile banking, helps banks save money on customer service, since solving a problem in a tweet or two is far less costly than a call to a customer service representative or an IVR system.
A New Era, A New Approach The overall strategy here is proactive, personalized and real-time customer interactions. Monitoring a real-time Twitter search for "Bank of America" will reveal tweets that David reached out to proactively. And banks that have deployed a proactive mobile banking solution can send actionable alerts when important account information needs to be communicated, issues need to be resolved, or cross-sell messages are warranted.
Now, more than ever, the shift from reactive to proactive customer interactions is of utmost importance to banks. Regaining customers' trust and business will require personalized attention and demonstrable proof that the bank cares.
A proactive approach also drives cross-sell opportunities. Research from Javelin showed that "high touch" bank customers-customers who "touch" their bank through access points (such as branch, mobile, text alerts, online, etc.) seven or more times per month-buy significantly more banking products than "low touch" customers (those who touch their bank less than twice a month).
Mobile banking and Twitter are two channels that inherently increase the number of customer touches by enabling both bank-to-customer and customer-to-bank interactions. Both present a simple and low-cost way to make a huge impact on customer service and communication. As both channels continue to grow in customer adoption and technological development, even more opportunities to retain assets, acquire new customers, cross-sell products and reduce costs will undoubtedly present themselves.
Joseph Salesky is chairman and chief strategy officer with mobile solutions provider ClairMail.