Why financial institutions should invest in empathy

In an era where the customer experience has become more important than ever, ensuring your service is not only efficient but also highly customer-centric.

With this considered, how are financial services companies’ improving customer experience? A recent guest post by IDC research director Marc DeCastro for Smart Communications outlined four key ways financial institutions are working to improve these processes.

As a key part of human communication and connection, empathy is a vital trait. For businesses in the digital age, this is even more so. DeCastro said, “Delivering an empathetic financial experience involves keeping the customer at the center while engaging the customer using both available data and technology on their channel of choice. Data is really the key here when trying to deliver empathy in financial services, as data provides the insight required before, during, and even after the engagement has happened.”

DeCastro noted that as consumers shift to digital-first interactions with their financial institutions, this empathetic experience must be able to be delivered seamlessly across both digital and physical channels. He used an example of if customers find they have a better experience when dealing with a bank employee on a particular issue, they will likely continue to use that channel while avoiding digital options – something most institutions will not want in the digital age.

To deliver a strong, empathetic experience, DeCastro highlighted that this boils down to two main themes. The first is that companies should provide predictable communications that are personalised and are contextually aware of current and previous engagements. The second theme is about loyalty and building lifetime value.

What are the four areas of focus that should drive investment in tech solutions to boost customer experience?

The first, according to DeCastro, is customer intelligence. He said, “Investments here need to be able to capture as many points of data as possible, both data generated within the institution as well as third-party data sources. In order to build or provide solutions that can personalise experiences based on the context of the engagement, there must be a foundational layer of intelligence to draw from, otherwise personalization becomes difficult, if not impossible. With the right amount of customer intelligence, it leads itself nicely into the next strategic initiative, product innovation.”

The second key area is product innovation. DeCastro remarked that innovation on traditional bank products and services can often be more about policy and less about technology. Thirdly, firms should orchestrate customer intelligence and product innovation. He said, “Now that customer intelligence and data collection have been prioritized and innovation solutions are being developed, it will be important to combine the two into tangible customer improvements. Solutions like virtual agents, next-generation chatbots, and true omnichannel engagement can result from successful implementations of new products built on top of modern architecture. Having an agile environment in place will continue to foster innovation and improve overall efficiencies.

The fourth point surrounds the growing role of AI. AI solutions in financial services, DeCastro underlines, have begun to evolve way beyond robotic process automation and have reached the level of providing true value back to the customer and the financial institution’s employees. He added AIAI can be used to monitor text, voice, sentiment, and emotion in a way that can deliver that empathetic experience many individuals are looking for from their institution.

DeCastro concluded, “Providing a truly hyper-personalised and empathetic banking experience will require that we truly put the customer in the center of everything and view products and services not through the lens of the financial institution, but rather through the lens of the customer. To build trust, we need to think less about providing financial transactions and more about helping customers achieve their financial goals. We also need to provide employees with the same level of modernized solutions and interfaces that we provide to customers, which will create that common and fulfilling experiences.

Find the full post here.

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