Banking’s Most Important Currency: Customer Trust
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Transcript of Banking’s Most Important Currency: Customer Trust
COPYRIGHT ©.2014. ALL RIGHTS PROTECTED AND RESERVED.
Banking’s Most Important Currency:Customer TrustApril 1, 2014
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Today’s Speakers
Elizabeth GlagowskiEditor-in-Chief
Customer Strategist Journal
Don PeppersFounding Partner
Peppers & Rogers Group
Weston McDonaldHead of Financial Services
TeleTech
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Event logistics
Please turn off your pop-up blocker You will not be able to participate in today’s survey
Download a PDF of today’s slides Click the green resource widget
Have a question for the presenters? Click the red Q&A widget
Helpful tools Click the gold question mark for help with technical issues Enlarge slides when needed Twitter Hash tag: #customerstrategy
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Agenda
Disruption is the new reality
Why trust matters to great customer experiences
5 key drivers of customer trust in banking
Attendee Q&A
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Disruption is the new reality
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Disruption is the new reality
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Disruption is the new reality
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• 60% of checking accounts likely to become unprofitable soon
• 35% of customers already buy significant services from a competitor
• Non-bank competitors and new technologies make it easy to switch
The business model is being massively disrupted
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Traditional ProductsCDs, Money Market, etc.
34%
% of customers leaving their current bank to do business with competitors…
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Credit Cards
53%
% of customers leaving their current bank to do business with competitors…
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Automotive Loans
68%
% of customers leaving their current bank to do business with competitors…
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Brokerage Accountsand products
82%
% of customers leaving their current bank to do business with competitors…
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Non-traditional new entrants are also stealing share of customer
Source: Forbes Banks could lose 35% share by 2020 report
Online Only
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Financial Management Hybrids
Source: Forbes Banks could lose 35% share by 2020 report
Non-traditional new entrants are also stealing share of customer
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Source: Forbes Banks could lose 35% share by 2020 report
Non-traditional new entrants are also stealing share of customer
Payment Centric Technologies
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Big Box Retail Entrants
Source: Forbes Banks could lose 35% share by 2020 report
Non-traditional new entrants are also stealing share of customer
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Disjointed interactions and product silos drive customers away…
Source: Ovum Business Trends 2013, J.D. Power and Associates 2012 U.S. Retail Banking Satisfaction Stud 24/7
56% of all customer journey episodes are
multitouch and multichannel…
…but 80% of banking interactions don’t retain the data
from the last interaction!
71% of channel cross-
over events need
information that has already been given
Customer support is still
driven by product silos
Personalized treatment
is still maturing
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…But good customer experiences do drive growth
The likelihood that a customer will open new accounts and purchase additional products/services…
A good web experience increases
likelihood by 11 times
A good contact center experience increases
likelihood by 14 times
Source: 2013 Gallup Bank Customer Engagement Study
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Why Trust Mattersto Great Customer Experiences
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In a word:
What exactly is a “good” customer experience?
Frictio
nle
ss
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Friction reduces loyalty and cross-selling
Customer loyalty is not highly correlated with a superior customer experience…
…but customer dis-loyalty is highly correlated with a poor customer
experience!
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Product experience
Customer service
experienceSource: The Effortless Customer Experience, 2014
Bad news for financial services!
Likelihood to tell friends about a good or bad customer experience:
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Moore’s Law
Every 20 years, computers get a thousand times faster and cheaper.
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Zuckerberg’s Law
Every 20 years, we interact a thousand times more with others!
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The more we interact, the more trust we demand
Trust makes interactions more efficient
Interaction generates transparency
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Proactive trustworthiness
“Trustability”
In the e-social world it’s no longer enough simply to refrain from cheating or deceiving customers
Extreme trust
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Extreme trust requires a company to proactively watch out for its customers
Extreme trust
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…and customer engagement generates trust
Trust reduces friction…
Extreme trust
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Customer engagement leaders outperform customer engagement laggards
Total Shareholder Return 2007-2012
50%
40%
30%
20%
10%
0%
-10%
-20%
-30%
-40%
S&P 500 Index
Leaders outperform laggards by
77%Customer
Experience Laggards
-34%
14.5%Customer
Experience Leaders
+43%
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Higher NPS scores drive higher revenue growth
Citigro
up
Bank o
f Am
erica
HSBC Ban
k
Chase
TD Ban
k
Well
s Far
go
PNC Ban
k
Fifth T
hird
Bank
U.S. B
ank
BB&T
SunTru
st Ban
k
Region
s Ban
k-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
-20
-10
0
10
20
30
40
50
-10.9%
-4.7%
0.0%
2.2%
6.5%7.9%
8.9%10.7%
11.8%
16.0%
28.3% 28.8%
Revenue Growth 2013 NPS Score Linear (2013 NPS Score)
20
11
-20
12
Re
ve
nu
e G
row
th
Ne
t P
rom
ote
r S
co
re
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Five Key Drivers of Customer Trust in Banking
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Every interaction should improve customer trust
…this createstrust, which…
• Knows the Customer• Removes Friction• Resolves Problems
• Eliminates Surprises• Protects the Customer
• Increases Asset Growth• Captures More Share
of Wallet• Grows Customer LTV
• Reduces Costs to Serve• Breaks Down Product
and Service Silos• Increases CSAT/NPS
When a bank:
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Five key drivers of customer trust in banking
Not having to repeat information already given
Knowing the banking relationships (family, businesses)
Keeping information accurate
Knowing channel preferences
Knowing the customer “persona” – e.g., customer needs
Keeping in touch with life events and customer episodes
Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Know theCustomer
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Five key drivers of customer trust in banking
Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Know theCustomer
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Intelligently connecting the customer to the right answer or resource the first time
Making contact and engagement easy
Seamless communication and transition between channels and product silos
Eliminating waste from the value chain and processes
Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
RemoveFriction
Know theCustomer
Five key drivers of customer trust in banking
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Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
RemoveFriction
Know theCustomer
Five key drivers of customer trust in banking
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First Contact Resolution
Technology to facilitate outcomes
Associates empowered to take actions
Segment-based associate training and insight
Intelligent Web Self Help
Connected and harmonized multichannel engagement
Social knowledge management
Problem feedback to drive continuous improvement
Know theCustomer
Eliminate Surprises
Protectthe
Customer
ResolveProblems
RemoveFriction
Five key drivers of customer trust in banking
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Know theCustomer
Eliminate Surprises
Protectthe
Customer
ResolveProblems
RemoveFriction
Five key drivers of customer trust in banking
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Keeping promises and managing expectation inflation
Communicating difficult scenarios – fees, pricing, regulatory changes
Proactive outreach
Triggering communications in key processes Card application, replacement
Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Eliminate Surprises
Five key drivers of customer trust in banking
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Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Eliminate Surprises
Five key drivers of customer trust in banking
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Associates who are advisors and advocates – e.g., not selling the customer products they do not need
Always acting in the customer’s best interest
Professional treatment and recognition
Communicating to the customer according to that customer’s persona
“Fair play” – proactively making things right
Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Five key drivers of customer trust in banking
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Know theCustomer
RemoveFriction
ResolveProblems
Eliminate Surprises
Protectthe
Customer
Five key drivers of customer trust in banking
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Poll question
Which of the 5 key drivers is the biggest opportunity for improvement at your company?
1. Knowing the customer2. Removing friction3. Resolving problems4. Eliminating surprises5. Protecting the customer
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Making Customer Trusta Reality
©2014 TeleTech Holdings, Inc. Confidential and Proprietary 45
• Segment Treatment Plans• Multichannel
• Segment Based Investment Allocation • Predictive Modeling
• Acquisition• Cross-Sell/Up-sell• Churn
• Align Corporate and Customer Metrics
Strategy• Customer Segmentation
• Customer Lifetime Value (Current and Potential)• Needs and Wants• NPS and Voice of the Customer• Demographics
• Customer Metrics
Insights
Building Breakthrough Customer Experience
1 2
36
45
• Business Process Redesign• Contact Center Optimization
• Data Architecture• Enabling Technology
• Multi-Channel Communication• CRM & Social Knowledge• Systems Integration
• Organizational Design
Business Design
• On-going analytic model updates• Enterprise Metrics• Customer Metrics (e.g., NPS)
Measure & Refine
• Care Professionals• Technical Support• Multiple Geographies & Languages• Licensed Associates
Manage• Pilot Test• Measurement and Iterative A/B Testing• Refinement and Roll out
Deployment
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We’re just getting started
Stay engaged with us:
• Download “Restoring Trust in Banking” PDF
• One-day trust assessment workshopEmail Liz at [email protected] for more info
• Subscribe to the Customer Strategist Journalhttp://bit.ly/CSjournal
47COPYRIGHT ©.2014. ALL RIGHTS PROTECTED AND RESERVED
Q&A Session
Elizabeth GlagowskiEditor-in-Chief
Customer Strategist [email protected]
Don PeppersFounding Partner
Peppers & Rogers [email protected]
Weston McDonaldHead of Financial Services