Customers increasingly demand immediacy and accountability in their service interactions, whether that means ordering a pair of shoes from Amazon.com or a pizza from Domino’s Pizza.
Financial institutions are not immune to this standard; as customer expectations evolve, so too must banks’ approach to customer service. To retain relevance and customer loyalty, bank executives must prioritize the digitalization and personalization of customer service. If institutions are not working towards this transformation, they’re already behind.
Leveraging capabilities like digital customer service can enhance the customer and employee experience while diminishing the risk of complacency — strengthening a bank’s overall competitive position.
Many banks still employ a phone-centric approach to customer support, which can be inefficient and cumbersome for all involved. Even though bank transactions are frequently initiated or occur on digital devices, customers are often required to dial into a contact center when they encounter issues or have questions. Recent research from Bankmycell found 81% of millennials experience anxiety when making a phone call. But this dislike for phone calls isn’t unique to younger generations; a study by Provision Living found that baby boomers made even fewer phone calls than millennials do on their smartphones.
The customer service bar is set by the likes of Apple, Netflix and Meta Platform’s Facebook: companies that facilitate seamless, uninterrupted interactions with as little friction as possible. It’s time for bankers to be able to meet customers in the digital domain and empower them with choice on how to communicate, whether it’s through chat, video or voice. Such an approach boosts the customer experience and fosters long-term loyalty.
Digital customer service can improve the employee experience as well. The customer service agent role has traditionally been one of low satisfaction and high churn, which is especially concerning as the country continues to experience the Great Resignation. Digital customer service allows frontline agents to join a digital interaction in progress on the customer’s own screen, eliminating the risk of miscommunication and expediting resolution time. Such technology even allows agents to guide customers in how to solve the issue themselves next time. As a result, agents shift from customer care representatives to become a teacher or coach, instilling confidence in users to solve future issues through digital self-service. Digitalized customer service and a seamless on-screen experience allows agents to complete tasks with greater speed and efficiency — while making the role itself more enjoyable and fulfilling.
Complacency is both a common barrier and a looming threat for bank executives; many keep legacy processes and strategies in place because of comfort and fear of change. But the failure to innovate can be a death knell for banks when it comes to keeping up with competitors. And technology continues to shorten the innovation cycle — making complacency that much more dangerous.
Financial institutions are at the vanguard of innovation in the consumer-driven market; experiences are the key differentiator. Customer service, and how customer-facing employees work, are experiencing dramatic digital transformation. As a result, financial institutions must examine, reconsider and frequently adapt to new technologies as they emerge.
The banks that recognize the urgency of modernizing customer service and act accordingly will benefit from a competitive advantage for years to come. Those that fail to act risk falling behind competitors and face significant customer attrition.