How to Outpace Big Banks in Four Steps

Big banks tend to make the best first impression. Bank’s potential clients who value more rewarding customer experience are currently more likely to choose a big bank. This article shows how to balance this trend.

 A joint research paper by RateWatch and IntelliShop has compared how financial institutions interact with their potential customers. After the first visit to a big bank (with over $10 billion in total assets) 42% of survey participants felt confident that this bank would be the right choice, compared to just 30% who have said the same of the credit unions and 22% at the small banks. This discrepancy between first impressions was caused by different approaches towards the customer: from greeting customers at the entrance to providing the most suitable financial product.

Financial institutions of any size can achieve a better customer experience while still maintaining profits. And certainly, a strong first impression is just one dimension of this new customer-centric approach. These four questions are designed to evaluate customer service in your financial institution and define directions for further development.

1. Are we employing advanced analytics to predict customer behavior? It is vital that accumulated customer data should be mined and processed. Predictive modeling is used for portfolio stress testing, analyzing product prototypes, gauging marketing trends and more.
2. How long does it take for front-end employees to access customer interactions and preferences? Credit prescreening and cross-selling tools maximize new account opportunities in a brief window of time. To achieve the most comprehensive view on the customer, lenders can source data from interactions history, credit reporting agencies or alternative data sources.
3. Which channels of customer engagement does our technology landscape support? There will be 20 million new smartphone users by the end of this year, according to a Leo Burnett study. Making banking accessible is just as important as transforming it from routine activity into a fun way to handle finances more wisely.
4. Are we optimizing customer satisfaction investments against the profitability of individual customers or customer segments? Planning marketing campaigns according to potential outcome allows organizations to maximize ROI. Companies that segment users based on their spending patterns can implement multiple customer engagement strategies.

These are very important questions to ask before moving on with further changes. According to the 2012 BI and Information Management report by InformationWeek 59% of organizations using business intelligence tools say accessing relevant, timely or reliable data is their biggest impediment.