What do financial institutions really need to have to retain and attract new customers? This question might have came up in several financial institutions´ board meetings and for sure there were several different answers too. Customer service, best rates, products, fraud and theft safety or transparency probably are the first ones that pop into your mind. However, from Bankingly we also identify two key points that are significantly important in order to achieve these objectives. By fulfilling these goals financial institutions should lay the foundations for keeping their customers happy.
User experience
User experience for financials institutions is the overall interaction of the institution with the user, either virtual or face to face, that has results in a positive or negative perception of the service provided. The first key point is to provide an outstanding user experience.
Big Companies as Facebook, Amazon, Spotify or Apple have accustomed users to be provided with a really great user experience. For them “the customer is the king” and that is how they make them feel. Under this premise, they offer a platform which is easy to use, intuitive and user friendly, where the customer feels satisfied and even more important, willing to use it again in the near future. These companies are true experts in making their users wanting to use again their products and this is one of the main reasons why they have achieved an incredible popularity.
Users of these platforms are used to a high level of customer experience across the platforms that they regularly use and have no reason to expect of accept any different from their banking institution. According to the Study made by Bankingly “Financial institutions for Millennials… and not so Millennials” (link to the study), more than 50% of Millennials would agree to change their financial institution to one that provides them with better digital channels. Therefore we can appreciate the importance of offering a great user experience, not only for financial institutions but also for any company in the world.
Machine Learning
The second point that Bankingly finds crucial in order to retain and attract new customers is related to artificial intelligence, and more specifically to machine learning. Machine Learning is branch of AI that has the objective of developing processes and techniques that allows computers/ systems to learn in an independent way.
Nowadays, companies and above all financial institutions have massive amounts of information about their customers and aren´t taking advantage of its potential. For example a bank knows how much their clients earn, how much do they spend on the gym or to which school they send their kids. This “Big data”, as known in the tech word is not being used efficiently by financial institutions.
The question that may arise is: how to take advantage of this massive data and how to know which information is relevant and how. For example, a Bank can know how much someone spends on Uber per month. If this spending is high, the bank can offer them a deal to buy a car or a frequent user deal. Today financial institutions are lacking the development of these processes and are missing opportunities of increasing their sales and even really knowing their customers.
Financial institutions should anticipate to their customers preferences and offer them what they will be willing to buy in the future. If a loan is close to its expiration date, a new loan should be offered to them, without sparing any time even for the customers to analyze other loans from the competition.
Moreover if a clients expresses somehow not to be interested in a specific product that has been offered, it is really difficult that he will agree on buying that product the next time and let alone the 30th time. If every time this client goes to the branch or opens the banking mobile app the same product they refused to buy is offered again, this turns into relevant advertisement space that is being wasted and therefore potential sales.