Michiel Lely, VP of Practices, EMEA at Verint
It’s no secret that banks have looked to move many of their services to online solutions in response to the growing consumer demand for digital, and in an effort to manage cost. This has manifested itself in dramatic fashion across the banking industry, most notably on the high street. Since January 2015, more than 1,000 bank branches have closed in the UK. But are banks acting too rashly in replacing that human touch with digital channels, and do they risk alienating their customers who crave a more human experience?
To answer this question, we studied the preferences of 24,000 consumers from 12 countries across the globe. We also asked more than 1,000 organisations worldwide about the digital and traditional customer service channels they are prioritising and investing in. The results are loud and clear – banks need to work hard to get the balance right between the human and digital customer experience.
It all comes down to the human touch
Despite the rapid rise of technologies like AI (artificial intelligence), wearable technology and the plethora of automated services and channels available, consumers across the world still crave the human touch in today’s digital-first world. In fact, four out of five (81%) UK respondents preferred that human customer service interactions remain a part of customer service in the future.
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As branch closures continue across the UK, banks should heed this warning. While managing their account online is the most popular way to contact banks in the UK (49%), going into the branch comes second, as the preference of almost a third of customers (32%). Closing branches therefore means that banks are hitting a significant portion of their customer base, by making it harder to use their preferred contact method.
While there is clearly demand for digital services, which is only going to get stronger with the rise of Millennials and Generation Z, the human touch remains vital. Banks need to ensure that they are educating their customers on the benefits of other contact channels, and ensure that they are comfortable using them. By removing one channel, they are responsible for taking the customer on a journey to another. Those who fail here could risk losing valuable business to more customer-centric competitors.
A digital experience for the technological age
Banks are responding to technological change and leading the way in the adoption of digital technologies – including biometrics for authentication and security purposes, and AI. They offer customers new ways of engaging with them across digital channels. However, despite the promise of a digital future and the demand from younger generations, only 10% of UK consumers said they preferred to contact their bank using mobile apps, for example.
There is certainly more work to be done to improve the digital experience. More than half (55%) of UK consumers and 91% of businesses globally feel that customer service online, and via mobile devices, needs to be faster and more intuitive to serve users. As banks look to lead their customers on a digital journey, demonstrating that the new experience is founded in greater speed, deeper insight, and better desired outcomes, is crucial. But it won’t be easy.
Getting the balance right is a complex task
Banks need to strike a balance between embracing the digital technologies of the modern age, while taking care not to alienate those that have a more traditional preference for their customer service. This means embracing the full range of potential contact channels and offering a truly omnichannel experience. This is particularly important as consumers contact banks for a huge range of reasons, from a simple balance check to complaints, fraud, and far more complex matters. And this complexity is a crucial factor, adding another layer to the question of which contact channel consumers prefer.
Our research showed a strong trend across dealings with all organisations, but particularly banks, that the greater the complexity of the query, the greater the preference for more traditional human lines of communications. Almost a third of UK customers prefer to go in-store (32%) for complex enquiries, while 37% prefer to connect via phone. The closest digital channel for complex customer service situations is live chat, but only 7% of consumers opt for this.
To fulfil the communication needs of all their customers, banks need to make sure they have a full tapestry of both digital and traditional channels. This includes factoring in the range of customer preferences for different contact channels, and their preference based on the complexity of the query.
A final word of warning
As consumers become more digitally savvy, banks continue to evolve customer engagement strategies, implementing more cost-effective digital channels. But there is a clear word of caution: consumers still want that human touch – as our research across 24,000 consumers clearly highlights. This dynamic means that banks must be aware that in their eagerness to embrace the digital future, they cannot neglect human interaction, or their customer-centric past.