Software, consulting and systems provider NTT DATA UK has undertaken a wide-ranging study both across the financial services industry on its efforts around digital customer experience and the view of the consumers. The results show insurers still have some way to go according to Kim Gray, Head of Insurance and Head of Diversity & Inclusion.
The financial services sector must meet the challenge of changing customer attitudes to digital transactions and customer experience.
We surveyed a wide range of decision makers across the financial services sector on their attitudes to digital customer experience and while many believed they were meeting the challenge, we also asked the consumers, and many disagree.
In our research it became clear there are two very different types of consumers. The first are the “Settlers” these are on the whole the older demographic, they are technology laggards, they prefer fewer financial services relationships, although the relationships they have they value.
The second are the “Explorers”. These are the younger demographic, technology early adopters. They are comfortable with multiple financial services relationships and value cost-savings.
While 18% of the settlers believe that digital customer experience needs to improve that figure was 73% from the explorers. Of more concern was 86% of explorers would be happy to move their financial services relationships if there was a better digital customer experience on offer.
When it came to greater advice digitally 45% of settlers said they wished there was more while that figure went up to 77% for the explorers. It came as no surprise that the explorers were far more willing to provide greater personal information if there was a tangible benefit, but so were the majority of the settlers, if it meant that what they would receive was more personalised to their needs.
There is no doubt firms recognise the benefits. They cite improved customer retention, improved customer services, improved customer acquisition, revenue growth and improved brand image as the top five drivers for better digital customer experience.
While 76% of insurers believe they are on track with their digital customer experience company objectives, dig a little deeper and only 24% said their front-end customer interaction data is well integrated with back-end support processes.
For consumers the five biggest challenges when it comes to digital customer experience will resonate with many in the insurance sector.
The biggest is being unable to accomplish what they wanted to do when on line.
The second is to find the options provided are not relevant to them. Time remains an issue with the third biggest gripe being having time wasted by tasks that take too long to complete. This is followed by having to enter the same information multiple times in a single transaction. The final concern from consumers in the top five is when too many options make completing the task difficult.
While there is a clear consumer demand the financial services companies are still not ready to take advantage. Of the respondents to our survey 49% said their company was not ready to take their digital customer experience to the next level.
In terms of the biggest challenge to making that step, data was identified as the biggest barrier by 69% of those who responded.
It became clear the problem isn’t linking the data. The problem is accessing, mining, and analysing it.
Issues range from sourcing and obtaining data and data quality to managing real-time interaction and integration of data across products and channels.
With the impending arrival of GDPR Privacy was seen as the biggest issue followed by security, and lack of talented staff when it comes to data expertise. Forty six percent said they struggle to manage the amount of data they have available in order to utilise it for improved customer experience.
So how do firms solve this data dilemma?
Firms need to take a leaf from the explorers’ attitude to information and recognise and treat data as an asset and as such approach it with a view that in itself it has a value and that value must be recognised when interacting with customers.
Tom Winstanley, Head of Innovation at NTT DATA UK, explains, “insurers need a vision and to build their organisation and platform taking a leaf out of the tech companies’ books. They need to recognise the privileged position they have and focus on transparency to customers about their data and how that can in itself be a powerful branding position.”
This vision needs to be created across the company around how best that data can be leveraged and used as a business tool, enhancing the customer experience and with it the attraction of the digital platform to consumers. This strategy must address the issues of data quality, data mining, data analytics and data access.
There is little doubt that financial services firms are increasingly recognising the importance of the need to enhance their digital customer experience.
They are now aware there is a distinct group of consumers – who represent the future customer base – that are less loyal to their current financial services providers and are willing to share data for more personalised service and guidance.
However, major data challenges exist for firms to improve the customer experience they currently provide to those who wish to access their products digitally.
They recognise that it may well be the biggest problem in several ways, but data makes the difference in that customer experience. Therefore, firms must focus on bolstering their data foundation if they want to elevate their digital customer experience and future proof their businesses.