5 CX Best Practices to Fuel the Growth in Digital Banking

Data and rigorous analysis of it represent the key difference between banks and credit unions that kid themselves about customer service and experience and those that really deliver.

Every bank and credit union executive my firm interviews tells us that their organization is different from all others because of the customer experience they deliver. Every single one of them has a story about a branch employee who went above and beyond. There is one story of an employee driving to one of their clients to deliver them a replacement debit card. Funnily enough, this story has been repeated enough times by multiple institutions that we often wonder if they are real but identical stories or just variations on an urban myth.

In any event, the devotion to customer experience and service is encountering a barrier: As financial institution consumers migrate increasingly to digital channels, banks and credit unions find they are at a loss to replicate their own differentiation in the digital realm.

This is not surprising, because many financial institutions don’t spend much time thinking about the digital customer experience. Websites are designed by agencies with minimal direction and then it’s generally only from the marketing team. At the same time, digital banking, online account opening and loan application processes and other digital platforms are often designed by third parties with minimal input from the bank or credit union.

Banking’s Bizarre Disconnect:

Banks and credit unions would not dream of letting someone else define what happens in a branch. So why are they allowing third parties to frame what happens in the most-visited delivery channel?

Financial institutions — even the smallest — must start taking an active role in optimizing their digital CX.

From our years of working with financial services organizations, we have defined five customer experience best practices that you should apply now, overall, but especially to digital channels:

1. Listen to Customers

Banks and credit unions often tell us that they already listen to their customers. Most often they explain that they have an annual survey and based on the responses to a single question, they can measure their Net Promoter Score (NPS).

Sorry, but if that is the extent of your organization’s listening strategy, it’s a wonder you’ve stayed in business. There are plenty of excellent arguments for why NPS should be retired. Our favorite is analyst Ron Shevlin’s simple argument: “It measures intention, not behavior.”

Whether an organization relies on NPS or on more data from frequent surveys, the problem remains the same. Surveys only measure people’s opinions or their intentions. They do not measure what they actually do.

Years ago when I was in banking I conducted a survey of my customers that found that a majority preferred to do their banking at the branch rather than on ATMs or via digital banking. However, the data told a very different story when I looked at the actual number of branch visits versus ATM or digital banking sessions.

Strategy In A Data Vacuum:

It’s amazing how few financial institutions have ever thought of comparing the ways their customers engage with the bank or credit union.

Often we do a simple pie chart of customer touchpoints for our clients. Branch visits always lag behind all other touchpoints… and even in 2021 that shocks some.

A listening strategy can involve surveys, and even NPS, but it should also include a deep understanding of customer use data to understand what behaviors are actually being exhibited.

Further, institutions should have a process to actually spend time with customers to understand what they do and how they do it. Customer interviews that look at how consumers manage their finances, whether with the organization or competitors, can yield insights that cannot be found from a survey and are always surprising.

The ultimate goal of listening to customers is build empathy. When a bank or credit union becomes a listening organization they can put themselves in people’s shoes and can identify customer needs and wants — sometimes even beyond what they can articulate.

Henry Ford identified consumers’ need for fast and efficient transportation. But instead of developing what a customer might have asked for — a faster horse — he developed the Model-T.

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2. Develop Behavioral Personas

To aid in building empathy, the organization should develop behavioral-based customer personas that express their understanding of their customers.

Note: These personas are different from demographic personas developed for marketing of yore.

Behavioral personas do not describe real people nor prescribed behaviors assigned to demographic profiles, e.g., “Millennials are tech-savvy” or “Boomers prefer branches.” Personas are made up of trends, patterns and facts from listening to your actual customers. Personas allow the organization to step into customers’ shoes and answer service, product, or experience questions.

Four steps to developing behavioral personas:

1. Gather data from your listening activities (i.e., interviews, survey, customer data profiles). Define trends and patterns that emerge.

2. Develop a hypothesis that identifies different set of customers and what makes them different from each other. We use tools like Empathy Maps and Affinity Diagrams.

3. Define the ideal number of personas to use that will address the desired customers.

4. Write a description of each persona, highlighting behaviors, differences from others, and details that can bring them to life, such as values, goals, lifestyle, attitudes, etc. Adding fictional personal details and a name will help the team bring that persona to life for future use. The descriptions should be 1-2 pages long.

3. Build Customer Journey Maps

Financial institutions can use personas to examine and optimize customer experiences. One way to accomplish these tasks is to build customer journey maps. Customer journey maps are a way to visualize how a customer interacts with an organization. Customer journey maps highlight key events, motivations and areas of friction within a specific customer experience.

Sometimes we see organizations confusing process maps with customer journey maps. Process maps aim to define every single step in a process and are often internally focused. On the other hand, customer journey maps don’t document every step in a process; they document customer touchpoints in an experience.

Processes and experiences may be similar. But sometimes a customer experience encompasses several parts of processes. For example, a process map that shows the auto lending process a bank follows should not be used to examine a customer’s auto buying or even loan application customer experience.

There are many tools and templates available to help an organization develop a customer journey map.

Some guidelines to developing a customer journey map:

1. List all touchpoints in a customer journey.

For example, in the case of the auto lending experience, consider what a customer typically goes through to get to the decision of applying a loan. Generally, people don’t decide to get an auto loan. The journey is about buying a car. Even if you are looking at the digital experience only, think about what compels a customer to arrive at your website and the touchpoints within your website and application process.

2. With the touchpoints defined, choose one of your personas and go through the touchpoint list. For each touchpoint, list the actions that persona performs. Keep an eye for any touchpoint that requires too many actions.

3. As with the actions, list out the persona’s emotions and motivations at each touchpoint.

4. Understanding the persona’s actions and emotions will help define the obstacles and pain points at each touchpoint. Highlighting roadblocks and frustration will help you define opportunities to improve the customer experience.

5. For each touchpoint, inventory the resources available and missing within the organization.

6. Analyze the results of the exercise. At this point, you should be able to define opportunities.

7. Repeat the process for all of the defined personas and desired customer journeys to understand any other customer experience gaps.

4. Retool Customer Journeys

The above exercise should yield a list of actions to improve customer experiences, whether to rethink processes and interactions, remove obstacles, apply new technology or change policies. Rather than merely tackling the list in any order, a structured prioritization should take place while keeping in mind the size and level of impact of each action, cost and alignment with the institution’s goals.

For digital experiences, the most common retooling we see involves improving content, calls-to-action, and navigation — and applying personalization. This is the step where the tools for the orchestration journey can be applied to improve the digital customer journey.

Answers Are All Around You:

Banks and credit unions hold vast amounts of data about their customers. And every time a customer interacts with the organization, they produce more data. Mine it!

Journey orchestrations tools can use data, and insights from its algorithms, to provide a better experience for the customer. The experience is presented in real-time and within the context of whatever activity the customer is pursuing. These tools can also enrich this experience by leveraging data from second and third parties, like credit scoring or digital footprints.

5. Track and Measure So You Can Learn from Experience

Implementing changes isn’t the end of the process. Customer listening, personas, and journey maps should be living documents that you should continue to use, edit and adjust. Reviewing them monthly or quarterly will make sure you’re your institution remains customer-centered.

Further, organizations should define key performance indicators or metrics to ensure that the impact of changes are resulting in improved customer experiences. Data analytics and customer listening should surface new roadblocks to tackle.

True customer-centricity is the secret sauce that is separating many organizations throughout the financial services industry. Technology is enabling and accelerating the impact of customer experiences based on consumer expectations, needs and wants.

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