BY NAHEED CHOWDHURY
CX FOR FINANCIAL INSTITUTIONS
What is CX?
CX (or Customer eXperience) is how your company meets (or not) a consumer’s expectations from each interaction between them and your company .
It’s also worth mentioning that CX includes each and every customer contact with your employees, your product and services, and how they are delivered. CX has a quantifiable value that accumulates while you build relationships with customers through communication, trust, loyalty, and recommendations.
According to one leading research , CX has overtaken products, services, and price as the main brand differentiator.
What is the ROI of CX?
Investing in CX initiatives for your company has the potential to double your revenue within 36 months3 . Research in the same report also found that companies that earn $1 billion annually can expect to earn, on average, an additional $700 million within 3 years of investing in customer experience. Here are some more key findings:
• Customer-centric companies are 60% more profitable than companies that don’t focus on customers.
• 84% of companies that work to improve their customer experience report an increase in their revenue.
So how do Financial Services fare overall with CX?
CX in the finance world is a constant struggle. The coronavirus (COVID-19)crisis has highlightedthe importance of CX in the banking sector.
A study by Kantar found4 that financial institutions that lead in CX have a higher recommendation rate, a higher share of deposits, and a greater likelihood that customers will increase their portfolio of new products and services from their bank. Conversely, it was found that financial institutions that let their CXdecline risk losing up to 12.5% of their share of deposits.
While improved CXcan benefit financial services companies across the board, the opportunity is even more important for female consumers:
- 61% of female bank customers stay with their bank for more than five years, as on the whole they are less satisfied than men.
- Women have a lower preference score for their bank than men (65 for women vs. 76 for men), indicating that they may be more willing to switch if a better alternative presents itself.
- Women are also less willing than men to take up additional products or services with their bank (64.3% vs. 73% of men).