The Knife Edge of Customer Confidence in Financial Services

You learn from those who lead and succeed as well as those who fail and struggle.

Right now, amid the latest revelations of Westpac’s mass compliance failures, the Financial Services industry is a boiling hot tempest of dissatisfied customers, frustrated shareholders and brands in trust free-fall.

That’s why, when the IBR FINCX2019 Conference on 20 – 21 November in Sydney, brought together marketing executives and managers from brands such as First State Super, RACQ and Colonial First State Super to talk about the state of customer experience in Financial Services, we listened intently.

In this current market, with customers on the knife edge of confidence, which marketing and CX teams are succeeding? And what programs have they rationalised, or rebuilt?

We distilled over two days worth of insights into these top five successful initiatives:

1.     Define your best customer experience moments and emotions

The opening speaker, Dan Monheit of Hardhat, stressed that customers remember your brand based on the ‘peak’ moments near the end of the engagement: this is known as the ‘Peak End Rule,’ a theory outlined by Daniel Kahneman, Nobel Memorial Prize winner for Economic Sciences. Defining your customer experience strategy around the ‘Peak End Rule’ not only differentiates your services from others, but makes your brand more memorable.

Dan Monheit, (Director of Strategy, Hardhat – IBR Sydney, “How brands can win, according to my therapist”) said it well:

“Let’s be honest, said Monheit, “it is a waste of time to invest all your time in pulling everything up to a 9 or 10 (customer satisfaction score), because it is impossible. If you did then you will just be forgettable and average.”

Instead of improving the customer experience overall, when devising your brand experience, ask when and where you can give your customers that “Wow” moment.

Leading Edge recommends focusing on customer touch points that most clearly differentiate your service from your competitors, making you memorable and impactful.

2.     Time’s up for customer data laggards

Customer data should be the backbone of your decision-making, opened Kimberley Roberts from RACQ.

Insight-based decision-making is nothing new, yet very few businesses are truly squeezing every benefit it offers.

Roberts from RACQ showed how effective use of customer data leads to better decision-making outcomes, having attained the number 1 ranking Australian brand in KPMG’s Customer Experience Excellence Report 2019 with a Customer Experience Excellence score of 7.83, as well as the number 2 spot for All Brands including International. All the more impressive achievement when you consider that RACQ didn’t event rank in the top 5o last year.

Roberts attributed this success to 3 core processes RACQ implemented across their marketing:

• Placing Integrity at the core of all marketing activities and outputs

• Integrating the marketing team with the business analytics and insights team; and

• Testing, testing and more testing. Roberts noted that all campaigns go through marketing mix modelling and then a two-stage regression model to discover the optimal path for promotional tactics.

That’s a significant investment to values-driven content creation and testing and optimisation. Very few organisations truly commit the time or resources to this combination, and yet as RACQ demonstrates, when customer trust and confidence is on the line, data can show you the way and ensure consistency.

Leading Edge recommends closer collaboration between your marketing and data analytics team. Closer collaboration between these teams yields better outcomes in insight than being separated.

3.     Meaningful stories can help clear the air with customers

There’s a common perception that super funds, banks and insurers are greedy, profit-obsessed organisations.

“It’s the image some customers are painting of the financial services industry, but it doesn’t need to be the only story,” said Grace Palos of Future Super, as she challenged the room to share more meaningful stories with customers.

Palos described stories that have meaning to both the organisation and customer through a formula:

Meaningful Stories = Ownable + Proof + Right to say + Accountable

The first step to meaningful, values-led marketign is to showcase another perspective that customers can connect with”, outlined Palos.

To regain the trust lost through the Royal Commission, financial services businesses must be the first to show that they have turned a new leaf.

“We talk about shoes, clothing and the things we want to buy all the time - Financial Services plays such a big role in people’s lives - it makes no sense to not talk about them! We (Financial Service businesses) should be telling them (customers) that we messed up and own that mistake.”

Leading Edge Takeaway – if you find yourself having to regain customer confidence and trust after a failure, invest in clearing the air: explain what happened. Shift into greater transparency with urgency.

4.     Take a razor-sharp focus on values in your content marketing

“Great content is underpinned by great content strategy,” pointed out Lauren Quaintance, the Co-founder and Head of Content at Storynation.

In marketing, there’s a lot of noise: voluminous offers, irrelevant content and a false sense of urgency created in order to sell, sell, sell.

“Creating a content strategy that breaks through the noise and connects on an emotional level increases retention rates,” said Quaintance, while sharing tips on how to create a content strategy that’s ‘razor-sharp’:

1.     Search for Customer insights online – all your customers are talking online, be where your customers are frustrated about your competitors.

2.     Understand customer preferences and triggers – Utilise more than your data pools and look for 2nd party data to get a more comprehensive view on what triggers and preferences your customer would like. Use testing tools like Google Optimise to test your content.

3.     Look for interest to influence – List your customer’s top 20 sites they visit and identify themes. Then look at what your competitors are doing, because they’re the ones taking attention away from you.

4.     Focus on removing ‘murky water’ content – Your customers are demanding more realistic and complex content. Don’t be ‘vanilla’, radically think of different ways you can present themes the customer cares about.

Leading Edge Takeaway – Being bold with your content isn’t about gambling on what might work. There’s a method to get to the heart of what your customer desires: own it and align your business values with those values. Be bold, always have a content strategy and test your hypotheses.

5.     Encourage interdepartmental collaboration

The event’s panel discussed how interdepartmental collaboration can best deal with increasing expectations of customer service. Tech and consumer giants like Google, Amazon and more recently Dominos, all are vying for customer attention through mobile devices, and customers are being taught to expect the same quality of service from more traditionally regimented businesses, life financial services.

Interdepartmental collaboration creates better problem solving and customer service outcomes.

Collaboration across financial services needs to expand beyond marketing and sales coming togehter. Customer demands are becoming more complex, requiring more than just one business function to complete.

Leading Edge recommends that financial services maps out their customer journey and pinpoint touchpoints where teams can benefit from interdepartmental collaboration. Place a manager to oversee and hold both teams accountable and govern the collaboration to track its progress.

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