Digital technology and data to redefine customer experience in financial services

How important is customer experience to success in the rapidly changing financial services sector?

According to Mark Hassell, KPMG Australia's Partner, Customer, Brand & Marketing, nine out of 10 CEOs say it is the biggest area of competitive challenge they foresee for their business by 2020.

“The day of the consumer is most definitely here," said Hassell at the recent Financial Services Council Technology Workshop in Sydney. “To fundamentally understand the customers you've got and the ones you want to attract is actually the day job. You can't be in denial about the role of the consumer in your business any longer."

Underscoring the importance of keeping customers content is a Royal Commission into Misconduct in Australia's Banking, Superannuation and Financial Services Industry. The Commission has provided a public platform for customers to voice their concerns.

Hassell, who was previously Chief Customer Officer at Virgin Australia, said the Commission presents an opportunity for the industry. As Bill Gates famously observed, “your most unhappy customers are your greatest source of learning".

Those who proved capable of anticipating and eliminating customer pain points would win a decisive competitive advantage in the future, he predicted.

Hassell and his fellow panelists Matt Keeley, co-founder of GROW Super, and George Lucas, founder and CEO of Raiz Invest, agreed that technology and data would be key to shaping the best-practice customer experience of the future.

Leveraging technology for a better buying experience

When GROW Super was looking to seamlessly offer its clients the best insurance deals, Keeley knew he was facing a customer experience challenge.

Many customers were unaware that they were paying 88 basis points more on insurance because they were incorrectly classified as blue-collar smokers.

A technology solution was needed.

Instead of trying to convey tedious information to time-poor customers through brochures or face-to-face meetings, Keeley's team built “Tinder for insurance". This is an app that asks customers to simply swipe left or right to auto-classify by occupation.

Machine learning and Artificial Intelligence will increasingly eliminate customer pain points before they occur

“We don't tell you the whole story that you are getting charged 88 bps per year or more or even what bps means. We just force you to tell us your occupation. After you do that, we just say, 'We saved you about $122,000 over the next forty years. You're welcome. Smiley face' and move on. That's customer service."

Lucas is convinced that machine learning and Artificial Intelligence (AI) will increasingly eliminate customer pain points before they occur.

“Companies like GROW Super and Raiz will start including more AI machines that will be able to anticipate and solve your pain points before you even know about them," he said.

"It's all about the data. The more data you have, the better you can customize the experience."

GROW Super's team maximizes the use of live data to map the superannuation journey and zero in on moments when a customer may need human advice or a more tailored service.

“The adviser can watch your world, and as they watch your world, the app will tell you when inefficiencies occur," Keeley said. "For example, 'You have just taken out $250,000 in non-deductible debt ' or 'You have just bought a house and you are under- insured'. Your financial adviser will get that trigger and alert at the same time as you."

The providers that are going to win ultimately are those that truly empathize and understand what they are doing for the customers

Mr Hassell warned that those who lagged in ensuring benchmarks for dealing with customer complaints had kept pace with the digital world would fall behind.

So, too, would those who continued with a customer experience model where customer contact only occurred at pain points.

“When people choose to complain because things have been particularly bad, and they're told that it will take several weeks to respond, surely those days have got to go? It's disrespectful. The providers that are going to win ultimately are those that truly empathize and understand what they are doing for the customers."

Fintechs are well-placed to pioneer quality customer experiences

Lucas reported that Raiz Invest customers have a high degree of trust and will readily exchange their data for an easy and seamless online service they value.

"There are a lot of people who want human interaction, but there is larger number of people who want online interaction," he said. "We know the people who sign up to us prefer that 'online only' experience."

Hassell advocated for a customer experience strategy that built trust and incorporated human contact where appropriate.

At every point in the customer experience journey, whether digital or human, service providers should demonstrate personalization, empathy, integrity and effort in resolving even seemingly impossible issues, Hassell said.