Global banks and insurance companies are on the back foot when it comes to delivering the online experience consumers are looking for.
Our latest tranche of global Autonomous Customer research reveals that ratings of online customer experience in the sector lag far behind those of the leaders, the online service companies. Banks and insurance companies are traditional enterprises that are struggling to keep up with the standards set by digital native organisations. What’s more, there’s no significant sign of this changing: the research has only seen a fractional improvement in the ratings of financial services’ customer experience between 2017 and 2019.
Banks and insurers need to make fundamental shifts in approach to put the customer experience front and centre. As ancient institutions founded on the principles of pooled risk and no element of personalisation, they’re working from a base where the individual’s experience wasn’t valued. This contrasts starkly with new challengers to the market who are building their structures and processes around putting the customer experience first; established firms are having to play catch-up. Plus, any customer experience advances insurers and banks make must work within tight regulatory frameworks that aren’t there in other sectors, meaning they lack the freedom to innovate to the same extent.
Trust must underpin all change
Clearly, with so much ground to make up, banks and insurance companies need to target their efforts to transform the customer experience where they’ll make the maximum difference.
However, any action taken must be set within the context of the need to build and maintain trust throughout the customer experience, since it’s trust that underpins any positive perceptions in financial services. Ultimately, customers need to feel their money, or their risk is being handled by safe hands. They need reassurance that their data is secure in this digital age and that the people they’re dealing with are giving the right advice.
Digital transformation is a prime opportunity to provide a good customer experience that will build trust throughout — so in this post we’ll look at hot areas for change highlighted by our Autonomous Customer research that could be included in a transformation programme.
Scope to go digital with app growth
A clear area where financial services firms can meet the experience expectations of the tech-savvy is with the development of mobile banking and insurance apps. Our research shows these are a fundamental part of banking for two thirds of consumers, with 34 per cent using them at least once a day and a further 30 per cent using them two or three times a week.
Video steps up as a new form of face-to-face
With branch visits declining combined with a widespread rationalisation of branch networks, opportunities to build trust traditionally through face-to-face contact are falling. Our research reveals that video has a role in bridging this gap, stepping up as a way to add a more personal touch in specific circumstances. Video is emerging as the ideal compromise for those looking for the reassurance and trust-building qualities of face-to-face contact, particularly suited to older cohorts who are less comfortable in the digital world. Two thirds of respondents wanted to be able to use video chat to discuss a financial services product such as mortgages with an advisor, with 61 per cent saying they might want to use video chat to discuss the renewal of an insurance policy or claim.
Consumer trust expands to include some AI
Consumers’ trust levels are ready to allow AI into the financial sector’s customer service equation — but banks and insurers must get the balance right, not pushing consumers beyond their current tolerance limits.
Our research shows that consumers are ready for proactive contact from banks and insurers, opening the door to text, phone, push notifications and email. This opens the door to more of a two-way flow of communication across a range of channels, customisable to the individual’s preferences.
Consumers recognise the traditional face of the financial institution is changing and see a role for AI-powered chatbots to carry out simple transactions or straightforward insurance renewals. Across the board, 63 per cent like the idea of getting simple financial information and advice from a chatbot, and 61 per cent like the idea of using a chatbot for renewing a policy or contract. A surprising 79 per cent would welcome organisations providing automated advice using AI. Customers could be presented with a set of multiple-choice options around appetite for financial risk, for example, and, as they entered answers, the algorithm would dynamically provide recommendations.
These steps towards digital transformation — and any others — must be taken in a way that maintains customer trust in the organisations. To get the full picture of how to preserve and build trust while evolving,