Stop me if you’ve heard this one before; “A man walks into a bar….”
Ok, in this instance a woman walks into a bank. She enters the banks to execute a series of transactions. The bank pulls up her profile and sees previous school loans and a rather non-existent income. She’s just another customer. As she begins to explain the transactions needed they quickly learn she works for a company that recently went public and is now going to be acquired. Her share of wallet contribution increased. The problem is the profile the bank has on file is about 15-years old and it represents her life as someone just entering college. 
The Truth
This is a very true and very relatable story. It’s very difficult for financial institutions to capture a 360-view of the customer. But that’s just the start. FinServ organizations must move beyond the 360-view because that view only demonstrates the profile of that individual at that time. Life events, like getting married and having children, and life stages, like retirement, skew that profile on record. Financial organizations must work towards developing a 720-degree view of their customers.
The Challenge
Of course, this is easier said than done. Most individuals diversify their money and investments across multiple institutions. This makes it extremely difficult for financial companies to understand the value and financial objectives of individual clients. It’s also a challenge to understand when life events and life stages are occurring or better yet, about to occur. And finally, tack on the fractured infrastructure found in most institutions and you can see why universal profiles are so difficult to develop.
It’s not that institutions are ignorant. There’s a recognized need to be customer-centric. They desire that universal profile but they’re challenged by the silos that exist between LOBs. There’s very little, if anything at all, shared internal or external of the LOB. Additionally, regulation requirements add another crimp in the process. Certifications limit what can be sold so systems must have role-based security measures in place.
The Role of the Branch
The branch certainly plays a major role in capturing customer information. In a report by the ABA they found, “despite regular reports of its demise, the branch appears to be making a comeback, picked as the preferred banking method by 21% of respondents, up from 18% the previous year”.
Nessa Feddis, SVP, ABA, says: "When people are conducting a complex transaction like opening an account or applying for a home or business loan, they often prefer to do it in person. We're seeing a branch renaissance in some areas, with many banks transforming their branches to become more efficient and customer-friendly." This is especially true given the multichannel structure in most financial services organizations.
Customers cannot start and complete the same transaction across the same channel. And with this increase in channels comes an increase in issues and regulations. But how you choose to engage your customers, and the customer experience you offer, become your competitive differentiator.
Old Culture vs. New Capabilities
Financial Services is starting to see “old culture vs. new culture”. Actually, it’s more like “old culture vs. new capabilities”. Financial Services companies are recognizing that they need to shift the conversation from capabilities to possibilities. This shift must happen if institutions want to streamline the customer experience and develop that 720-degree view.
Financial organizations can be proactive in capturing explicit information through outbound communications, forms, surveys, and information captured in a CRM. They can then segment, target and personalize communications around net worth, tax bracket, asset type, portfolio value, investments with competitors, and investment objectives.
And now, institutions can move from proactive to predictive. Companies can analyze the digital body language against content associated with life events and life stages. Is the customer engaging with content about college savings programs, the merging and protection of assets, or investment strategies? Analyzing a broader digital footprint is now also possible. By pulling from 3rd party data providers companies can supplement what is known about their customers.
Unifying data and systems, as well as analyzing and acting on the insight, is still a work in progress. However, these new capabilities are allowing companies to move beyond the “old culture” and focus on the new customer-centric possibilities.
How are you working to better understand the customer?