Monday, 18 January 2016
Customer experience in fintech land
My main thesis for the financial services industry is that finserv = fintech. That is, all participants will have to behave like tech companies and focus on technology, data and customer experience.
Talking about customer experience I had a poor one recently with the bank I bank with – I wish this bank no ill will, yet I would love for them to become service-oriented.
I had three accounts with this bank. I decided to close one of the three which I rarely used. I called the service desk to have that account cancelled and asked for advice. The lady on the other end of the call could not provide me with any type of advice – pros and cons of closing, would it increase my fees with the other two accounts, what would be the unintended consequences. I assume she did not know and is also so tightly managed that she cannot deviate from a given script when interacting with customers. Anyways, the account was closed and it took 40 minutes too long. One month later I receive a statement that shows I am being debited a monthly fee for the account I just closed. One more call, 20 minutes more wasted, only to find out the account was not properly closed. Poor service? You bet.
Fast forward a few days and I receive statements for the remaining two accounts I have with my bank. One of the statements shows I am being debited a monthly fee. News to me as I thought fees were waived if I kept a certain $ amount threshold in the combined accounts which is clearly the case. One more call to the service desk, one more 20 minutes wasted, only to find out that both accounts were never properly linked when they were opened which was over 10 years go. I am now fuming over the phone. The poor service associate apologises, rectifies the error and credits three monthly fees for this year. 'What of the past 10 years?' I think to myself silently and my bad for not having checked my statements as well as the proper functioning of all my bank accounts.
I am still banking with that bank – the relationship hanging by a thread which i have labeled 'Pascal's inertia' – and I am left wondering what exactly does customer experience mean within the context of a financial services firm.
E-commerce has taught us that the traditional sales & marketing paradigm of product/price/placement/promotion is not sufficient anymore. In its stead the new paradigm of experience over the continuum of purchasing – pre-purchasing, purchasing and post-purchasing – is crucial for any retail consumer endeavor. By that I mean that for a given type of product or service we as customers require a certain level of experience around education and choice prior to purchasing, a frictionless experience when purchasing and a seamless experience around fulfillment, delivery and service or maintenance post-purchasing.
For certain categories of products we need just enough education, choice and excellence of service post-purchasing. For other categories of products we do. It depends on how important said product is in our life.
Most finserv incumbents do not get this new paradigm. My bank certainly does not. By all means 'getting' the right customer experience in financial services is tricky. We as customers are not terribly excited – positively or negatively – by our interaction with financial services unless we ask for credit, build up to a certain net worth goal or submit a claim with our insurance company. In other words, we tend to be have a discrete utility curve around specific events, not a continuous one. Further we get irate quickly when something does not work. After all it is our money and we are emotionally attached to our money.
Be that as it may, the customer experience needs to change. I crave a bank that would proactively advise me and guide me to the best products and services it offers. I do not crave being inundated with spam for new products or services that are not relevant. I crave a bank that has a holistic and contextually aware view of my financial situation. I do not crave to interact with service associates that have no clue about my situation, accounts and usage thereof. I crave personalised service. I do not crave being just another account owner that needs to be serviced. I crave granular yet light touch contextual service and offers. I do not crave blind and uninformed marketing. In other words, I crave personalised and meaningful experiences with my bank while not wanting invasive and contextually unaware interactions (and I also need to be a more alert consumer!).
Given that millennials are extremely focused on meaningful experiences, I assume I am not a lone voice here. Finserv incumbents have to figure a way to create and deliver these customer experiences. Banks in particular. The days of product/price/placement/promotion to generate and sustain sales are over.