CRM in Banking: Developing Customer Experience as a Strategy

Customer experience is the latest banner held aloft by brands to define their businesses. Visitors to any touchpoints, especially in banking sector, are bombarded for flyers, ads etc. on why the particular bank can only offer a delightful 'experience'. So, What's the big deal about 'customer experience' and why are banks gung-ho about using it as a strategy?

The largest private lender in Asia offers complete financial product selection, application and disbursal online. Visitors can easily give their details and find out whether they are eligible for loans, credit cards etc. special rate etc. Existing customers are displayed smart offers that are actually based on their needs and aspirations. All this enable the bank to enjoy an increase in customer loyalty index by 93%.

The Why?
Simply explained, a customer experience strategy is a plan of making customers happy and satisfied. Thus, retaining them and reducing their chances of defecting to competitors. It has become all the more important today, where digital incumbents are eating up bank's customer base with quicker and simple alternative product offerings. Staving the latest threats require maintaining and exceeding customer expectations that helps banks to have higher customer referral rates. Having experience as a strategy guideline can enhance customer acquisition and customer satisfaction as well as creating a competitive advantage.

Value of segmentation
As a first step, a bank needs to design the correct value propositions that are focused on experience. This can be done by dividing customers into value segments (based on income). Then define the products that should be enjoyed by that band and accordingly push the relevant offers By doing this, the bank will be able to meet the different customer needs and enhance satisfaction. Large banks in Asia at present harness the power of CRM solutions to deliver this experience.

No functional barriers
The bank should define customer experience and uphold it in all its sectors that offer customer service. Customer interaction is not limited to certain parts but multiple sections of the bank. The customers interact with various employees when purchasing, seeking service or support. The bank should, therefore, consider all departments to promote customer experience. To maintain the experience, the bank ought to try to own the customers issues, empower its team to solve the problems and be quick in solving them.

Another tip is for a bank to create an experience with the people and not with its brand or company. Customers need to deal with the people serving them and not the company's brand image. For example, it is disappointing to receive an email from a brand that is not personalized. Hence, the bank should ensure that every communication experience of customer service is personalized. This creates an opportunity for strengthening the bank-customer relationship.

Technology advantage
Finally, the bank should use technology not to create but enhance customer experience. Most companies leverage technology to 'create' an experience; this often leads to focusing on the capability of the technology and not promoting the experience. Instead of using technology to mold experience, define the experience that you want your customer to have. Then go ahead and find the right technology for the strategy, often CRM solutions. This can be done by examining and measuring the engagement of the customer service, sales and marketing tools in CRM for banks.

Inside Africa, mobile phones are allowing for new ways of lending cheaply. Letshego, a micro-lender from Botswana attracts low income customers who use mobile phones. With the help of a robust data center in South Africa, it analyses customer data and allows borrowers to payback in small amounts through mobile balances. It's analytical ability is so strong that it found out that people who entered both their name and surname are 16% less likely to default. Letshego, with its dual focus on customer experience and technology is able to enjoy cost to income ratio that is half of large traditional banks.

Thus, with the help of Banking CRM Solutions, you can focus on the needs of the customers; designing value propositions for customers, defining and creating an experience with them and developing technology to promote their experience.

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