Finance
The ROI of Chat Commerce for Small Credit Unions
Global Banking & Finance Review®
Company
By Hannes Van Rensburg, Chief Commercial Officer at Clickatell
Hannes is an accomplished executive and expert in the payments industry with a keen understanding of the macro drivers as well as the detail intricacies that drive revenue and better the customer experience.
Data has shown that credit unions – large and small – have seen record-breaking earnings compared to pre-pandemic numbers. However, the disparity in revenue between big and small credit unions still runs high, as institutions with more than $1 billion exceeded their 2019 peaks, smaller credit unions only neared pre-pandemic highs.
So, what can the large unions’ credit for their success? Technology investments made to improve operations, team efficiencies, and overall customer experience. In fact, pre-pandemic in 2019 JPMorgan budgeted about $11.4 billion for technology spend, while half of banks and credit unions with under $100 billion in assets budgeted less than $100 million.
As small credit unions have emerged from the pandemic relatively unscathed – and profitable – it is time to punch above their weight, capitalize on this momentum and put the profits towards improving the digital customer experience. Digital investment is the most important aspect here, as small credit unions and regional banks are noted as consistently delivering a better customer experience offline than bigger banks.
When thinking about boosting growth far beyond the COVID-19 era, one technology to consider implementing is a platform that provides communications to customers exactly where they prefer to chat – on their phones. In fact, according to a consumer report by Clickatell, one-third of consumers have communicated with a bank using a chat app, 73% are interested in banking via a chat app, and 70% are likely to use the chat app for banking if their bank/credit union offered it (millennials being the most likely).
Investing in Chat Commerce technology represents a critical opportunity for credit unions, especially small ones, to better personalize their communications and problem-solving abilities for customers. It will provide banks and credit unions with all the digital tools necessary to connect, interact, and transact with customers digitally, further enhancing brand loyalty and day-to-day interactions with the branch. This includes:
Imagine utilizing a messaging and notifications feature to communicate with customers directly and less intrusively when approval is needed on something such as a money transfer verification. To put it in perspective, the IRS has been in the process of sending snail-mail letters to more than 36 million families who are eligible for the monthly child care tax credit. Let’s think about how much more time- and cost-efficient that process would have been if each bank could just text each eligible person the update. Exactly…
Chat Commerce refers to the use of messaging platforms to facilitate transactions and customer interactions, allowing businesses to communicate with customers directly through chat applications.
Customer experience encompasses all interactions a customer has with a company, including service, product quality, and communication, which collectively influence customer satisfaction and loyalty.
Technology investments involve allocating resources to acquire new technologies or improve existing systems to enhance operational efficiency, customer service, and overall business performance.
Digital customer experiences refer to the interactions customers have with a brand through digital channels, such as websites, mobile apps, and social media, impacting their overall satisfaction.
Cost savings in banking refer to reductions in operational expenses achieved through efficiency improvements, technology adoption, or process optimization, ultimately enhancing profitability.
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