Why effective customer interaction is the key to success in the UK retail banking sector

The Online Factor
The UK has one of the most experienced and active online populations in the world. Over 66% of the UK population – as many as 40 million people – use the internet, with the average user spending around 23 hours a week online. 

This increasing confidence in the word wide web is also apparent in the retail banking sector. Driven by the convenience and choice offered by the internet, retail banking customers are quickly moving online.

According to a Gartner report published in February 2008, online banking is now a mainstream access method for UK retail customers, with 26% of customers - around 14 million adults – now banking online.

The emergence of this increasingly web-savvy group and the changing mindset of UK consumers will have dramatic implications for the retail banking sector.

The Rise of the Self-Server
As little as ten years ago, if I needed a telephone number, I’d dial 192 on my telephone or look it up in the Yellow Pages. However, the internet has changed the way that many of us manage our lives, find information and buy new products and services.

More importantly, it’s had a dramatic influence on our expectations of the brands and businesses that we interact with. The development of increasingly intuitive search engines means that we can use the web to find exactly what we want, in a matter of seconds. This ‘Google generation’ expects instant access to the systems, people or answers they are looking for.

In the retail banking sector, this sense of urgency is already being whetted with the new APACS faster payment system, which launches in May 2008. Guaranteeing faster online or phone payments, which can be completed end-to-end within a matter of hours, will only fuel customers’ demands for immediate and accurate sight of their balance, payments and transactions.

The rise of these self-sufficient, ‘self-servers’ will have dramatic implications on the retail banking sector, which is challenged with understanding and meeting the needs of a new and demanding banking customer.

Regardless of whether we prefer to bank via a branch, the telephone, website or email, the proliferation of the web means that we have become accustomed as a nation to the ‘on-demand’ delivery of information and services.

If we can access information at the click of a mouse, then why can’t our bank provide instant and up-to-date details on our bank account, loan application or mortgage repayments? We are no longer content to wait for our monthly statements to arrive through the letterbox and require our bank to have a 24/7 commitment to meeting our needs.

Satisfying the Self-Server
As the ‘self-serving’ population grows, the effectiveness of any bank’s customer service will be at the core of its ability to retain and acquire customers. These people expect instant assistance, speedy processes and a high level of service at all times, regardless of whether they are walking into a branch, calling their bank’s contact centre, emailing the customer service team or browsing the bank’s frequently asked questions online.

However, retail banks in the UK are struggling to meet these demands, and are in fact engendering a lack of confidence among their customer base. A 2008 report by Mintel found that 42% of customers were dissatisfied or very dissatisfied with the level of service they received from their bank. Almost a third (31%) also stated that the main reason they stayed with their bank or building society was because they simply did not believe they would get a better level of service elsewhere.

This issue of confidence is an important one. In a sector plagued by email spam, phishing and identity theft, confidence can be a key differentiator and the deciding factor for a customer to choose your bank over another.

Interacting with your customers effectively, across any communication channel, will be the key to engendering trust and confidence. Know and help your customer and ensure they have accurate answers to their questions as soon as they need them.

Effective Customer Interaction
Managing customer interactions is a key challenge for retail banks, particularly as the traditional branch banking system has expanded dramatically to include channels such as email, telephone and secure messaging.

Customers want immediate, consistent and high quality communication with their bank and will expect the same level of service and accuracy of information across every channel. Personalisation is key, as they also expect their bank to have an in-depth understanding of their banking needs and sight of each and every interaction that has been carried out before, no matter which channel it was across or who it was with. 

And that’s not all; at the same time the 21st century banking customer also wants the ability to help themselves and ‘self-serve’ in the way they are used to across the web.

A new type of customer relationship management is required, powered by self-service and support models, knowledge-enabled applications, and on-demand delivery.

Customer Interaction Management (CIM) is the key to delivering an exceptional customer experience across all interaction touch points, while empowering customer service agents and delivering cost and process efficiencies back to the bank.

Using CIM, banks can increase conversion rates in the online application process, provide agents and branch employees with a complete view of customer interactions across all channels, increase profit margins by understanding customer interests in additional products and services, and lower costs by providing automated and self-service options on the web.

Choice of Communication Channel
While the increasing use of the internet is driving a change in customer behaviour, let’s not assume that I’m just talking about online communication when I discuss customer interaction in the retail banking sector.

While choice of channel for customers is somewhat driven by demographic, a customer’s ‘circumstance’ at any given time can be the biggest driver to whether they pick up the phone, visit their branch, browse the website or send an email.

For example, I would like to call my bank from the privacy of my own home, but if I’m on a crowded train a quick message via their secure portal using my Blackberry is preferable. 

A recent Gartner report highlights that banking customers want consistency across different service channels and business units, so channel integration is vital. CIM systems provide agents with a blended view of all customer interactions, enabling queries to be handled efficiently through a personalised service.

More sophisticated systems can allow this personalisation to be taken a step further, routing customers back to the same agent they have spoken to previously.

Consistency of Information
However, while achieving a 360 degree view of the customer is key, there is no guarantee that the information provided across each channel is consistent, or accurate.

By utilising a knowledge management system, agents can access a centralised depository of information, documents and pre-written responses to ensure that the same messages are used across all points of customer interaction.

Rolling out this flexible, self-learning knowledge management system to a customer-facing environment can have powerful results too, by enabling customers to rapidly search for and find relevant information in a Web self-service mode that suits their ‘self-server’ mentality; and also takes considerable pressure off the contact centre team.

Often the same question will be asked time and time again by customers, so look for an intuitive knowledge base that identifies holes in customer knowledge in order to drive continuous improvements.

Proactive, Live Assistance
Retail banks lose as many as 40% of their website visitors before they have completed an application process. New technologies such as proactive chat and proactive browsing enable a new level of real-time support for customers, whether they are completing forms, conducting transactions or looking for information.

Providing online chat facilities and allowing agents to co-browse onscreen information with customers will ensure that banks can provide the right level of support at critical moments in the client’s online experience. 

Why satisfied customers = satisfied agents
Your staff and your customers are intrinsically linked and it is this critical connection that can significantly impact your business; both positively and negatively. In fact, the main cause of staff dissatisfaction is customer satisfaction, so it’s critical that you empower your agents with the tools and information they need to answer queries and resolve issues quickly and accurately.

Allow them to work more efficiently by managing multiple live chat sessions at the same time, offer up a comprehensive library of information so they feel empowered and informed when handling customer queries, or specialise in certain areas of expertise and handle the enquiries that suit them best.

Building trust and confidence amongst customers by providing a high level of service, will in turn increase morale and efficiency among your staff.

Staying Ahead of the Pack
Embracing a CIM-focused approach can revolutionise your customer service and optimise the benefits of multiple communication channels across the retail banking operation. As innovation in areas such as VoIP gain adoption, and customers increasing look for solutions that support new touch points, retail banks that offer the core building blocks of effective customer service will gain new customers, streamline operational efficiencies and increase market share.