There’s never been a better time to be a financial services customer – in theory, at least.
Once, if you had a query about your bank account or insurance policy, you either had to visit a physical branch to find answers to your questions, or sit on a phone line during office hours waiting for an operative to answer your call. Today, of course, that has all changed. If you want to ask your financial services provider a question, you can communicate by email, telephone or even social media, and expect a response no matter what time of day you reach out.
Yet customers very rarely use the same channels for every interaction. For example, a customer may complain about poor service from an insurance company using Twitter, but then use an online chat facility or phone call to find out if they can get a better premium. This can create problems for the provider.
The insurer in this scenario still needs to consolidate all this into the single customer picture – one that is necessary to shape and deliver excellent service. But it takes a great deal of time and effort to unite each interaction conducted on each separate channel. This is not least because, for many firms, it’s a quasi-manual exercise. This can lead to costly errors with high potential to cause distress, annoyance, and in extreme cases even cause customers to take their business elsewhere.
However, the best players resolve these challenges at the source. And they enjoy substantial benefits from the resulting difference in customer engagement. They ensure that all their individual channels are integrated into a single omnichannel experience that immediately consolidates every interaction from each customer – regardless of source. In retail, omnichannel refers to a multichannel approach to sales that seeks to provide the customer with a seamless shopping experience. And in banking, the retail advantages are obvious. By moving from multichannel to omnichannel, the financial services provider gains the correct and complete context and background before it engages with the customer.
Yet how well prepared are those in the financial services industry to integrate their communication channels effectively? As it turns out, the results could be better.
A recent global survey – conducted across 56 different countries by Pegasystems, Cognizant, and Marketforce amongst 500 senior executives in the financial services and insurance industries – found very few were positioned to offer a fully integrated omnichannel service. Indeed, just 4 percent of respondents claimed that they achieved this stage, while only 16 percent said they expected to have done so within a year. Meanwhile, 11 percent admitted that they had not integrated any channels at all.
What’s more, the real issue for organizations is even more complex than securing the “multi-omni” dynamic. As technology continues to evolve, they not only face a race to integrate existing traditional channels with digital ones they’ve only just begun to master. They must also need to keep pace with the rate of innovation and learn how to integrate new, emerging channels as well. Many in the financial services industry will congratulate themselves for integrating customer interactions from traditional channels such as the telephone with digital touchpoints that include social media. But the truth is that the majority haven’t yet scratched the surface of what they still need to fully embrace omnichannel.
This particularly rings true when you consider the next generation of tech-savvy financial services customers. They’re important to banking organizations, and to engage with this new type of customer, banks, insurers, and other providers are starting to realize they need to interact with them on their terms, using newer technologies. Indeed, research found that 80 percent of financial services-based respondents – four in five – felt that their organization would have to change its operations significantly over the next five years to keep up with 18-25 year olds.
Despite this, it also found that just 9 percent of financial services companies use wearable technologies such as smartwatches as a customer communication channel. Though another 7 percent said they are conducting pilots into the feasibility of doing so, it still raises questions as to the agility of the industry as a whole.
So when it comes to integrating new technologies into their omnichannel ecosystem, there is still work to do – and that challenge will only increase as new technologies and devices come on line.
There’s little doubt that the customer of tomorrow will increasingly demand when it comes to their communication channel of choice. And they will show little or no tolerance shown for those unable to offer a seamless experience across multiple channels. Organizations must not only ensure that they can offer this to customers; they but to also anticipate their needs by integrating new technologies into the mix. This forward-looking behaviour could play a critical role in deciding how successfully the industry will win and retain customers.
Everyone in the financial services industry must embrace omnichannel as an omnipresent part of its innovation strategy, and as a key means of engaging and interacting with customers of today and tomorrow. But it this also needs to be treated as a constantly moving target. The days of delineating between separate, established communication silos are long gone, and organizations will quickly learn that if they fail to meet evolving demand for access and emerging channels, as well as services, they will quickly start losing customers – entirely.
Graham Lloyd is the industry principal of financial services Pegasystems.