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Banking, Financial Services & Insurance (BFSI) in 2019: the Ultimate Guide to Customer Experience Management

Everything you need to take control of your digital offering and provide fantastic experiences to your customers

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CHAPTER ONE

What is Customer Experience Management?

Customer experience is an all-encompassing term that refers to every interaction a customer has with a brand across every channel – be it in-branch, on the phone, or online.

Customer experience management refers to how a company goes about measuring – and ideally improving – these customer experiences.

In the context of this guide, customer experience management refers to how banking, financial services and insurance (BFSI) companies manage the experiences and interactions customers have across their online offerings.

Customer expectations are changing - radically

Over the last decade, the BFSI sector has seen dramatic disruption. The advent of smartphones combined with digital innovation has revolutionized how consumers manage their personal finances and insurance policies.

Fintech startups and challenger banks, especially, have capitalized on this shift in consumer behavior to overturn the status quo.

Harnessing modern technologies, new companies can be much more agile than pre-existing BFSI companies stuck with legacy systems and cumbersome, outmoded processes. This agility has led to customer-focused services that create a level of convenience not usually associated with financial management.

UK-based challenger bank Monzo allows customers to set up bank accounts through smartphones, using fingerprint & facial recognition technology to handle security. It also has in-built budgeting, instant alerts when money is spent, bill splitting, and more.

UK-based challenger bank Monzo, for example, allows customers to set up bank accounts through smartphones, using fingerprint & facial recognition technology to handle security. It also has in-built budgeting, instant alerts when money is spent, bill splitting, and more.

These kinds of features empower people – and people repay that with their custom, with digital banking now overtaking branch use in the UK.

Customer expectations have therefore altered radically: consumers are becoming accustomed to convenient, customer-focused experiences when it comes to managing their finance and insurance policies. If BFSI companies do not urgently embrace this focus on customer experience, they face being left behind by competitors old and new.

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The good news is that many BFSI companies have responded to the disruption, and are investing more in customer experience strategies.

The question then is how BFSI companies can measure and improve customer experiences in an effective, sustainable way.

When good experiences go bad

Let’s put it simply. The difference between a good customer experience and a negative one is wholly down to how a BFSI business sets up and monitors its websites and apps.

Say, for example, a potential customer is looking to secure some travel insurance for an upcoming holiday. They might start on a comparison website, before being directed to your business. They fill out the questions asked of them and start to daydream about their holiday ahead.

But suddenly, out of nowhere, the page refreshes. The dozens of form fields they’ve just filled out stare back blankly.

Next time they have a choice between dozens of insurance providers, will they go for the one that’s just given them such a frustrating application experience? Unlikely. With so much consumer choice online, your BFSI business really only gets one chance to snare new customers.

Online experiences are just as tangible as those in-branch

The quality of most online experiences is not so binary. Some will be merely annoying, or unintuitive – others will be okay, or nondescript. The point is this: just because an interaction with your company takes place remotely on a personal device, the experiences customers have online are just as tangible and important for BFSI businesses to consider as those in-branch.

Indeed, all an unhappy or frustrated customer has to do to end the interaction with your company online is close your website or app – and in all likelihood they’ll never come back.

With digital growing faster than in-branch visits, BFSI businesses cannot afford to discount the importance of managing customer experience online.

CHAPTER TWO

6 Key Stats on Why Customer Experience Management is Crucial for BFSI Businesses

Providing fantastic experiences should be a no-brainer for BFSI businesses seeking to win and retain customers online. Sometimes, though, in the face of seemingly more urgent business needs, investing in customer experience can slip down the pecking order of a digital team’s priorities.

Download the stats as an infographic to share with your team

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However, providing good experiences online is business critical; it should never be viewed as a luxury. These six key stats illustrate why.

189% of customers stop doing business with a company after a bad experience

That’s right. With challenger banks and fintech startups raising the bar for expectations around digital interactions, and with so much choice online, all it takes is one bad experience for potential new customers to abandon BFSI websites or apps – and never come back.

Moreover, companies are no longer just competing within their industry, they’re competing on the best digital experience a customer has ever had. It might not seem logical that the ease with which someone can order a taxi on Uber would have ramifications for BFSI businesses, but because the medium where these experiences take place is the same – i.e. on a smartphone – customer expectations are the same, too.

2Only 1 in 26 people complain after a bad experience; the rest just leave

Of the people who leave after a bad experience, only 1 in 26 will directly tell you. Not only do you lose business, you learn nothing from it to prevent future churn.

3It takes 12 positive customer experiences to make up for one negative experience

Determined to win that customer back? That’ll take some doing. A much more efficient investment would be to minimize the likelihood of bad customer experiences occurring in the first place.

4Customers are twice as likely to share bad experiences than talk about good ones

Amazon CEO Jeff Bezos emphasized this point when he said, “If you make customers unhappy in the physical world, they might each tell six friends. If you make customers unhappy on the internet, they can each tell 6,000 friends.

If you make customers unhappy in the physical world, they might each tell six friends. If you make customers unhappy on the internet, they can each tell 6,000 friends.

“If there’s one reason we have done better than most of our peers in the Internet space over the last six years," he continues, "it is because we have focused like a laser on customer experience, and that really does matter, I think, in any business. It certainly matters online, where word of mouth is so very, very powerful.”

5BFSI companies waste 26% of their digital advertising budgets

It’s seven times more expensive to acquire a new customer than to retain an existing one, and this expense largely comes from the amount spent on advertising.

If your BFSI company invests heavily in advertising to attract new customers – and 71% of financial organizations intend to increase digital marketing spend in years to come – consider what happens when those customers land on your website or app. Does an optimal experience await them, increasing their likelihood of transacting? Or is the experience lacklustre, confusing, or frustrating?

Investing in advertising without investing in experience management is a one-way street to wasted budgets.

Investing in advertising without investing in experience management is a one-way street to wasted budgets.

686% of customers will pay more for a better experience

Investing in customer experience isn’t just to prevent the negatives that come from neglecting it. With Gartner stating that customer experience is the new battleground for enterprises, customers are actively seeking and willing to pay more for better experiences.

Investing in customer experience, therefore, is very much a positive strategy.

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For more numbers, check out Lumoa's comprehensive statistics and facts for customer experience in the BFSI sector.

The statistics are clear: if BFSI companies don’t invest in improving customer experiences, they face being left behind by their competition – and their customers. It’s not just a question of thriving; it’s a question of surviving.

The task now is working out how BFSI companies can go about improving customer experiences online. With so many different customers accessing your website or app with unique devices, it can seem a daunting task.

However, by adopting the right approach, companies can develop a highly successful digital experience transformation methodology – and reap the rewards from doing so. The first step lies in obtaining as much visibility into digital customer experiences as possible.

CHAPTER THREE

Measuring Customer Experiences in Banking, Financial Services & Insurance

The digital landscape is chaotic. Customers land on your website or app from all directions in contrasting emotional states, acting on unique motivations, wielding different devices with which to manage their finances or insurance policies online.

This might seem overwhelming, but there is an entire industry dedicated to making sense of these digital interactions. Marketing Technology provides BFSI businesses with the tools to measure, benchmark, and improve digital experiences across their websites and apps.

It’s all about data

The savior for obtaining visibility into online customer experiences lies in data. Data about website or app performance, your customers, and your customers’ behavior and state of mind.

By monitoring and using customer data in intelligent ways, businesses develop sophisticated, automated processes for measuring and improving customer experiences.

Customer data comes in quantitative and qualitative forms, and it is through combining the two that businesses make truly meaningful changes.

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Learn what’s happening with quantitative customer data

Quantitative customer data is essential for getting an overall view of customer behavior and website performance. Digital teams use tools such as Google Analytics and Adobe Analytics to investigate things like most-viewed product sections, where validation errors occur, where most users drop out of the conversion funnel, and so on.

When analyzing quantitative customer data, digital teams focus on reporting metrics like page views, bounce rates, and conversion rates – and segment this information across their audience.

When analyzing quantitative customer data, digital teams focus on reporting metrics like page views, bounce rates, and conversion rates – and segment this information across their audience.

This enables them to form a broad impression of web or app performance, and reveals areas that need more attention.

Teams may also visualize on-page behavior – where customers click, hover, and scroll – with heatmaps in order to garner an understanding of which content engages customers and which doesn’t.

This can be particularly useful for assigning hierarchy to elements on a new product offering page, or – as Dun & Bradstreet did – analyzing how traffic flows to specific on-page objectives.

While quantitative customer data gives teams a general idea of customer interactions and provides useful summary information, focusing only on broad metrics like page views and conversion rates results in a significant knowledge gap in understanding true customer behavior and sentiment.

In order to obtain this understanding and empathy, BFSI businesses must combine quantitative user data with qualitative user data, which grants rich, deep insight into user sentiment.

Understand the ‘why’ with qualitative customer data

Qualitative customer data refers to user data that describes attributes or properties. Examples include session replays, direct customer feedback, user testing – and anything else that involves deep, direct insights into customer sentiment and motivation.

Qualitative user data adds a whole new dimension to a brand’s visibility into digital customer experience. Collecting it provides useful, direct insights into customer sentiment.

For example, Fidelity International used qualitative insights obtained from Decibel’s session replay to fix a previously unknown issue affecting a significant number of customers. This fix alone provided 100% return on Fidelity's annual investment in Decibel.

Decibel provides critical insight into how we can make our website better for our customers. It’s an essential accompaniment to customer feedback. All we know is customers are unhappy - Decibel fills the gaps in our knowledge and enables us to fix issues without hassling our customers for more information or technical details.

Alexander Hamilton
Head of Digital Analytics
Fidelity International

Session recordings can provide incredibly in-depth insights when used effectively. In fact, they’re often the easiest and most cost-efficient way to get into the minds of your customers. Session recordings allow you to get very granular; they tell you parts of the story that, for example, heatmaps and scrollmaps may be missing.

Michael St Laurent
Optimization Strategist
WiderFunnel

Due to the deep, rich nature of qualitative insights, they are typically from a small sample size. It’s therefore important to combine them with quantitative user data to ensure that not only the nature but also the scale of any issues can be established too.

Get fully informed with qualitative customer data at a quantitative scale

Quantitative customer data provides the ‘what’ of website performance and customer behavior, while qualitative customer data enables teams to go deeper and understand why things are happening a certain way.

Discover the new category of customer experience data for BFSI businesses, DXS®

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Quantitative data has scale but lacks depth; while qualitative has depth but lacks scale – there are only so many session replays teams can watch back, for instance, only so many customers who give feedback, and so on.

The ideal for teams is to have access to qualitative customer data at a quantitative scale – i.e. rich, deep, intelligent insights about every single interaction and experience across their websites and apps.

With a new category of data emerging thanks to the latest technologies, not only is this kind of analysis possible, it is actively incorporated into the digital experience strategies of the world’s leading BFSI businesses.

Harness a new category of customer experience data

The first ever all-encompassing metric for measuring customer experience online, Decibel’s Digital Experience Score (DXS®) is a new category of customer experience data, combining the rich nature of qualitative data with the scale of quantitative.

DXS® automates the process of experience analysis across BFSI websites and apps, so teams can see exactly where and how to improve – in real time.

Powered by machine-learning, Decibel’s proprietary algorithms process hundreds of smart new digital interaction metrics – purpose-built to measure experience online – and automatically calculate an experience score for every visit to your websites and apps.

DXS® is based on five pillars of digital experience: navigation, engagement, frustration, technical and form experience. Reporting-wise, it rolls up from individual sessions, to individual pages, to the entire website or app – so you have visibility into opportunities for improvement at every level of the online customer experience.

With the Digital Experience Score, BFSI digital teams no longer need to sift through dozens of reports or maintain custom KPIs to track the quality of experience on their digital properties.

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Instead, they have a go-to, universal metric that can be segmented across their entire offering and audience for immediate insight into where the biggest wins lie – all without having to ask customers a single question.

Find digital experience issues before your customers do

With the automation of experience analysis comes the efficient surfacing of experience issues. Be it an unacceptably high load time on customer account pages, erratic mouse movements on new product offering pages, or low scroll reach on your home page: Decibel’s Experience Issues dashboard prioritizes exactly which issues affect the most users, radically reducing the time it takes to find actionable, meaningful, impactful insights.

experience-issues

By automating the process of user experience analysis in this way, teams can immediately identify specific issues that affect users – and this insight can be segmented across pages, conversion flows, and audience segments.

With less time spent researching and automating the measurement of customer experience, this frees teams up to focus on what matters: improving experiences, increasing conversions, and driving customer loyalty.

CHAPTER FOUR

How to Improve Customer Experiences in Banking, Financial Services and Insurance

To truly improve customer experiences, BFSI businesses need to consider two key things.

First, you need to think about the long-term strategy you’ll adopt for researching and implementing improvements in the face of business and customer needs.

Second, you need to think about the reactive strategy you’ll utilize for responding to customer experience issues in real time.

Emergent digital experience intelligence technologies have caused leading BFSI businesses to adapt the way they improve customer experiences.

Both these points – the second in particular – largely depend on the way you currently measure customer experiences, as discussed in the previous chapter. Indeed, the emergent digital experience intelligence technologies discussed have caused leading BFSI companies to adapt the way they improve customer experiences.

The traditional way to improve experiences in financial services & insurance: conversion rate optimization

The traditional way BFSI companies have gone about improving their websites and apps is through a process known as conversion rate optimization, or CRO.

At its heart, conversion rate optimization is a model that turns more website or app users into customers.

Digital teams research areas of opportunity for improving particular metrics on their websites and apps - conversion rates on new product offering pages, for example, or other metrics like page views and session duration.

They then hypothesize how to improve the metric they’re focusing on, and test the suggested changes. If the changes result in uplift, roll them out; if not, start the process over.

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Conversion optimization is persuasion-centric, not customer-centric

Conversion rate optimization is an extremely effective short-term method when applied to something specific, like a product or payments page.

Relying on conversion optimization, however, puts testing hypotheses at the front and center of improving digital experiences, which is inefficient in that it’s time intensive and expensive – especially if the insights hypotheses are based on are not all that compelling.

Relying on conversion optimization puts testing hypotheses at the front and center of improving digital experiences, which is inefficient, time intensive, and expensive.

Furthermore, conversion optimization focuses on optimizing conversions, not experiences: it is persuasion-centric, not customer-centric. It is therefore limited as a guiding philosophy for brands looking to improve digital experiences.

The new way: digital experience optimization

The emergence of experience data and machine learning means BFSI companies can take advantage of a more streamlined, evidence-based approach to optimizing customer experiences.

Having access to qualitative data at quantitative scale means digital teams can do away with trial and error and instead pinpoint exactly how to improve experiences for their customers.

Digital experience optimization is a BFSI improvement model that aims to optimize digital experiences. It cycles through three stages: measure, understand, and improve.

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Measure. The measure stage is almost fully automated. Teams monitor experience data across their online offering and respond to alerts regarding experience or technical issues, and analyze trends in user behavior.

Understand. Once a potential problem or bottleneck in the customer experience has been surfaced, it’s time to start honing in with specific analysis. Watch back session replays and review customer feedback to gain a fuller understanding of the problem, and use in-depth quantitative analysis to investigate its scale.

Improve. The initial problem has been thoroughly examined with quantitative and qualitative analysis. There’s either a straight fix, a hypothesis for a test, or an opportunity for personalization.

This experience optimization model puts the focus on the customer and removes the emphasis on guesswork from optimizing digital experiences.

Depending on the departmental set up of BFSI businesses, digital experience optimization models differ in the details (for example, see how LexisNexis harnessed digital experience optimization to increase annual website revenue by 81%).

However, they each share in incorporating the best aspects of conversion rate optimization – a scientific approach, a focus on the bottom line – while also considering digital experiences, the optimization of which is essential to establishing customer loyalty.

Respond to customer experiences issues in real time

Digital experience optimization is a cyclical, long-term strategy for improving experiences. It’s powered by having access to experience data.

It’s this same experience data that powers reactive strategies too, enabling BFSI businesses to respond to customer experience issues in real time.

It is only through having access to intelligent experience data that BFSI companies can take advantage of responsive customer experience management.

Say a potential customer is attempting to set up a new bank account online. Halfway through filling out their financial information, the website refreshes, wiping out all the details they’ve put in so far. They have to start again.

They shake their mouse in frustration.

Now a notification pops up. ‘Sorry about that – our fault, once your account’s set up, we’ll credit it with £10 for your inconvenience.’

The customer not only forgives the BFSI company – they’ll be spreading the word about what a fantastic experience they've had.

It is only through having access to intelligent experience data that BFSI companies can take advantage of this kind of responsive customer experience management.

And this experience data is just the beginning.

CHAPTER FIVE

What Does the Future Hold for Customer Experience and BFSI Companies?

Customer experience is the new battleground for BFSI companies, and technology that provides data specifically designed to measure experiences is becoming increasingly adopted throughout the industry.

This kind of customer experience data is used to power reactive strategies – alleviating experiences issues in real time – as discussed in the previous chapter. However, this is just one use case for how businesses can utilize the data.

As adoption becomes more widespread and machine-learning technology becomes more sophisticated, the potential for how BFSI companies can deliver fantastic experiences to their customers is limited only by the creativity of their digital teams.

The expert view

In order to deliver on the promise of personalization at scale, aka ‘great digital experiences’, businesses will no longer be able to rely solely on business rules, hypotheses and intuition. Data and machine learning must be in the forefront and leveraged to realize personalization at scale.

Michael Klein
Director, Industry Strategy & Marketing
Adobe

One touchpoint: personalized, unique experiences

The day is not far away where you’ll open your banking app or navigate to the website of your insurance provider and the experience you have is totally tailored to you.

In some respects in other industries, this day is already here. The Amazon homepage, for example, is filled with products recommended to you based on all the data Amazon has gathered on you – largely formed around your purchase history, which is not always the best guide as to what you want to purchase next.

No website or app, therefore, will ever be the same for two individuals: experiences will be tailored according to both what customers want to do, and how they want to do it.

However, this kind of customer profile will soon be informed by specific customer experience data. What kind of browsing behavior, for example, has this customer exhibited in the past? Are they direct? Or do they take a more scenic route to achieve their objectives? What sort of experience would best suit them?

BFSI businesses could use customer experience data to dynamically change their websites or apps depending on the answers to these questions. No website or app, therefore, will ever be the same for two individuals: experiences will be tailored according to both what customers want to do, and how they want to do it.

Preparing your BFSI business for the future

The first step into this new world of delivering personalized experiences to your online customers is in gathering experience data now.

Decibel’s unique technology is spearheading digital customer experience transformation for the world's biggest companies. Join leading brands like Fidelity, AllState, and Saxo Bank in securing your digital future with customer experience data.

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