What do banks get wrong in terms of customer service?
Customers are looking for three big advances: Is it personalized to me? Is it simple? And is it fast and easy? Whether it’s text messages or email or online chats, your customers might want to communicate at night or do self-service. Those are expectations that come to banking from other industries. The phone company, for example, is available at night and on weekends. Banking very much seems to limit communications with customers and I think they are missing an opportunity. It’s an opportunity to improve customer loyalty. It enables an increased number of transactions at a lower cost as well.
In terms of personalization, if the retail banking customer service person doesn’t recognize that I’m a commercial banking customer also, or that I carry a mortgage with that bank, or that the bank manages my 401(k), I’m disappointed. Traditionally, banks have grown up with different operations, different silos, even in the same branch. Commercial banking is different from retail banking. From a technology perspective, once those systems exist, they are costly to integrate. When there is no integration, it shows a lack of sophistication on the part of the bank.
What should banks do to improve in this area, especially since it may be expensive to integrate these systems?
Today, technology advances have helped banks from a cost perspective. Rather than integrating all these systems, you can have an interface that shows one dashboard or one common view for the customer. You would have the key data on a single screen across all the five or eight or 10 different bank operations. Not only could that be available to your customer-facing associates, but it could also be available to your customers online. They could log in with a single ID or password and see all their accounts. It can be integrated into a mobile (smart phone) platform as well. Bank management could aggregate information and begin to see if there are trends and what common themes they see across the bank’s diverse customer base.
What do those single-screen applications typically cost?
A lot depends on how many different systems you have. Generally, a bank operation can invest a month’s worth of typical system maintenance costs. So, if they are maintaining four systems and you’re spending $150,000 per year on maintenance, it would cost you less than $15,000 to develop a portal. There would be a similar cost to push it out to an online environment and then a little more for a mobile platform. I would think the single biggest improvement is starting with your employees and making sure they have a full view of your customers.
How should banks go about adding mobile banking?
Customers are adopting mobile banking more than five times faster than they did when banks introduced online banking. The return on investment [timeframe] is getting shorter. I would first make sure I knew what my customers want. The vast majority of banks already have online banking. You can actually study the key features your customers are using online and what you are doing well and not so well. Then I would look at platforms that are customizable for the key areas that I’ve identified as important to my customers. Does the vendor have a partner that is local [and that] I can work with in implementation? How much experience do they have customizing the system with banks that have a similar customer base? How costly will it be to make changes during implementation? From an implementation perspective, how much will the vendor provide from a quality assurance perspective on an ongoing basis?
What pitfalls should banks avoid in mobile banking?
Where the vast majority fail is when there is not clarity about what you want your mobile platform to do. If you just say, ‘let’s take standard options,’ that usually ends up with something that doesn’t reflect your brand. Taking advantage of what you know about your customers and writing clear requirements for your vendor is 90 percent of the battle.