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Customer Experience Management in the Financial Services Industry
Sanjeev Kumar
President & CEO-The Athene Group
Tuesday, October 20, 2015
Financial Services industry in the US has traditionally been slow to leverage the latest technology trends. However, some of the firms have attempted in the recent years to ride on technology trends to differentiate themselves from their competitors. Insurance companies, banks and wealth management firms have increasingly been focusing on Customer Experience Management (CEM) tools to attract and retain generations of clients ranging from the Baby Boomer to the Millennial. Focus has been on creating positive experiences for prospects and customers, through every personal and electronic interaction in the marketing, relationship management and servicing activities.

One-Stop Shop
Financial Services firms tend to offer a wide spectrum of services, either by themselves or through a network of partners, in an attempt to strengthen the relationship with the customer. Larger firms take pride in being able to support all financial services needs of a typical customer. These services typically include banking, credit cards, loans, mortgage services, insurance, wealth management, etc. The goal is to create a sticky relationship by being a single stop of all of the customer's needs.

Ever Elusive 360-degree View of the Customer
Organizations are focusing more than ever before, on creating a detailed profile of their customers. Investments are being made on technology and data to create and maintain such profiles. The social channels are being consumed to the extent possible to feed into such profiles. Profiles are designed to typically contain the attributes of the customer, product preferences, decision making criteria, life events, key influencers, etc. Given that customer profiles can always be enhanced with additional and newer information, such initiatives tend to be long-term investments.

Customer profiles are increasingly being considered the core of all business development activities. Innovative firms also tend to leverage customer profiles to evaluate their services portfolio and introduce new products and services.

Predictive Marketing
Detailed customer profiles with trustworthy information can help organizations understand and predict the needs of the customer. This can lead to personalized and timely marketing of products and services, potentially leading to stronger customer relationships and pleasant customer experiences. Interestingly, both these points seem to be the common factors in several of the television commercials of financial services organizations in the recent years.

Creating a Perception of Nimble, Friendly Firm
Many of the legacy financial services firms have been fighting a negative perception, especially in the minds of the millennial. Larger firms have been thought of being too big, too slow and not friendly. The recent recession and the federal bailouts did not help the matter, either. Several firms have embraced newer technologies, social channels and traditional marketing methods in an attempt to create a positive image. Such marketing efforts have attempted to portray the image of a nimble, friendly organization, built on the basis of relationships with common people. Some of the organizations have even gone to the extent of rebranding and renaming themselves to refresh such perception. And some firms have quietly launched subsidiaries with a completely separate name and branding to create a totally new image.

Offering Marketing and Servicing Preferences
The call to limit the storage and usage of personal information by businesses has been getting louder over the recent years. Privacy advocates, media and general populace have been using examples of security compromises by businesses, to push for limits on the amount of personal information gathered by companies and how it is leveraged for marketing purposes. Financial services organizations view personal information as both as an asset and a liability. In order to soothe privacy advocates, companies are making it easier for customers to specify their preferences related to the type of products, offers and communication that they would like to receive. However, the typical default preferences are biased towards over the top marketing. Companies also let customers choose the channel of communication for servicing to create a better experience.

Improving customer experiences starts with technology; sometimes overhauling existing solutions. Customer Experience Management initiatives in the recent years have been some of the largest technology projects in the financial services industry. Organizations are attempting to leverage the latest wave of technology solutions in the cloud in these projects. Several of the traditional CRM products have also evolved and added features and modules to support the concepts of customer experience management. Additionally, CRM products, master data management, predictive analytics, social channel integrations, mobile platforms, big data solutions, security solutions, etc., have commonly been parts of such initiatives. Smaller, niche boutique services firms that specialized in these concepts a few years ago have seen tremendous growth and many of them have also been gobbled up by larger players.

Progress and positive results achieved by some of the financial services firms with their respective Customer Experience Management initiatives have led others to think about similar attempts. Many lessons have been learned and best practices have been defined. Customer Experience Management initiatives are being justified more by the projected increase in the top line, rather than being rejected because of the impact on the bottom line. The continuation of this trend could mean big bucks for companies that offer products and/or experienced services in this space.
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