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Banking on customer intelligence

The market for retail financial services has become more competitive. Economic pressure from the downturn, combined with the growth of price comparison sites such as moneysupermarket.com, has led to the increasing commoditization of financial services, with consumers shopping around for financial products more than ever before. Meanwhile, recent market entrants such as Tesco and Virgin are growing by using their brand value won in other areas to shake up established players. 

On top of this, today's consumers are bombarded by information across an ever increasing number of channels such as web, text, TV and email. This plethora of communications and information channels creates a challenge for banks to reach their target audiences and influence their behaviour. 

The key to reach existing and potential customers in this new environment is to understand customers’ behaviour and what influences them, and when and where they are most receptive to influence. These deep customer insights, or customer intelligence (CI), can help retail banks design the right messaging for the right channels at the right times, to provide the greatest possible impact and influence. 

Where is the raw customer data?

Customer data is mostly stored in a variety of corporate repositories including customer relationship management (CRM) systems and sales systems, as well as the wealth of data that comes into the contact centre. 80% of this data is unstructured, which is a huge resource of potential information that can be tapped.

However, new technologies such as language identification, linguistic analysis and pattern matcher annotators can make a real difference in utilising call centre interactions. These technologies can help analyse the customer interactions with customer service advisors. This analysis of an actual conversation between a customer and a customer service agent provides valuable data about a customer’s true intent and their behaviour. This also gives us insight into how a customer perceives the services and products offered, which can help to identify the root cause of the customer’s call and as a consequence, enable the agent to handle the call more effectively. Cumulatively, CI tools can identify customers’ behaviour patterns and trends, which can result in improving a range of processes and ultimately enhance the customer journey – and reduce call volumes. It can also help ensure an even more personalised and longer-lasting fit between customers and the best financial service products available for them.

The value of partnering

Pulling out the raw data is of course just step one. The best CI gathering platforms will mine customer interactions – including customer webchat, emails and phone calls – and convert this into crucial insights about when and how to engage customers. The technologies and skill set required to develop such integrated and customised platforms are expensive and time-consuming. A cost-effective way of implementing customer intelligence can be to partner with an outsourcer that provides customer management services. Such outsourcers should already be at the forefront of analysing the efficiency of their own business, the productivity of their staff, delivery of services to clients, adherence to service levels and providing regular reports to clients.

Smart businesses will want a customer care partner to be able to bring together different forms of analytics from across the organisation to derive actionable insights, and leverage them in real time to improve the customer experience.

Independent technology analysts Ovum believe creating a single, comprehensive view of the customer is the key for banks seeking to boost profits and rebuild trust in the post-credit crunch era, predicting the market size for multichannel integration and customer information systems among retail banks to increase globally to $6.1 billion by 2014.

We are already seeing signs of this, with information delivery software developers SAS Institute reporting how, using CI, DBS Bank has reviewed its credit application process and identified where it could be optimised to reduce approval times, while Telstra, Commonwealth Bank of Australia and Coles are increasing their online spend, as well as following good practice in leveraging analytics.

The contact centre at the heart of customer intelligence

For a contact centre, the key to transforming itself into a profit-and-loyalty oriented operation for a retail bank would be its ability to generate and act on such customer intelligence. 

At the same time, it is critical for the contact centre management to forge strong relationships with the sales, marketing and finance groups in the organisation they serve. Such initiatives help the sales team to understand how the contact centre is enhancing its ability to sell to existing customers; marketing to realise the critical role the service team plays in growing customer loyalty and brand reputation; and the finance team to understand the role a contact centre plays in improving operational efficiency.

When selecting a strategic partner, retail banks need to look at whether their outsourcer has a 360° view of the customer through customer information integration, whether it can effectively analyse the customer journey and provide actionable insight to improve the customer service process.  An outsource partner should be able to use analytics to understand customer behaviour and actions and make suggestions to improve the customer experience which will lead to improvements in customer satisfaction levels.

The competitive advantage offered by customer intelligence

Retail banks can use CI to distinguish between customers, offer different interaction experiences to different customer groups and, in particular, identify priority customers. 

Working for one of our insurance clients, Firstsource has analysed reasons why customers have cancelled their motor insurance which enables our client to develop better customer retention strategies. 

Risk mitigation experts Scorto say banking customer intelligence systems can also detect potential bad loans, as well as identify clients who are likely to switch to another bank. Scorto integrated new and existing CI systems at a top 5 US bank which saw existing customer responses to marketing campaigns rise by 50% within 2 months of the integration, a 36% cost reduction in marketing to existing customers and the ability to reduce down credit limit calculations for targeted customers to just a few seconds. 

Huge numbers of customer engagement and retention decisions must be made, and made quickly, to attract and retain the right customers at the right price. The deep customer insights offered by CI analysis can help operators make the right choice. 

No company will achieve a huge return from CI in a single step; however each step will help build a complete understanding of customers which will in the long run show a return in terms of reduced costs, increased profit, and better customer retention figures. Each company will have a different journey, but no matter where they find themselves today they can take the first step. 

In today’s connected era, efficient contact centres will need to leverage unified communications tools, workflow management applications and predictive analytics to offer enhanced, differentiated service. They will need to integrate the new communication channels such as web, mobile and social media with the traditional customer communication channels, and analysis to deliver high-impact customer intelligence.

 

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