Tag Archive best practice

Customer experience in the era of 3.0 FinTech

This article on FinTech was oringinally published on the CX Network. If you want to read another article on FinTech, you can read my take on the future of the ATM.
Credit: CX Network

Credit: CX Network

The 3rd generation of FinTech is fantastic news for customer experience in niche segments, says CX expert Gustavo Imhof.

The surge of technology-savvy and customer-centric entrants in the financial services industry has caused great disruption in the market, forcing the industry as a whole to enhance experiences delivered to customers – putting them in the driving seat, like almost every other industry has. However, for financial services the FinTEch transformation did not happen as swiftly as in other industries. As it happened over two decades, we can distinguish three very distinct dynamics within the industry, you can learn even more about this at PSST! PH.

David and Goliath, Wile E. Coyote and the Road Runner, symbiosis; they perfectly illustrate the dynamics and the relationships we witnessed between FinTech up-spring and traditional financial services players since the early days of the dotcom craze.

In the early days, PayPal was the David to the banks’ Goliath, the small start-up that was there to upset the deep-routed balance in the current account landscape. Soon enough, international money transfer would be disrupted by new entrants like TransferWise, Azimo with lower fees and greater ease of use.

With traditional players reacting and trying to protect their established standing in the market, the dynamic changed towards one closer to the classic 1950s Looney Tunes cartoon Wile E. Coyote and the Road Runner.

It might sound far-fetched, at first, but consider this for a moment:

  • Road Runner is constantly going much faster, iterating routes with incredible ease and pivoting when critical for success and survival
  • The Coyote is very, very smart and resourceful and devises great strategies to reach his goals
  • Much of Coyote’s plans are based around the exact same sort of paradigm (Acme products) and it appears incredibly complicated to move away from established practices
  • It does happen that Coyote catches Road Runner, but even then, the rewards are not perceived to be as massive a success as hoped.

If you were to replace Road Runner by FinTech and Coyote by traditional players, we find striking similarities with recent events in the industry, such as longer established institutions trying to copy new market entrants, creating and running incubators, hackathons, and taking interest in or outright buying-out the more agile and disruptive FinTech actors.

In the early days, PayPal was the David to the banks’ Goliath, the small start-up that was there to upset the deep-routed balance in the current account landscape.

There is however a new dynamic which surfaced recently. This dynamic has actually existed in nature long before the written word but was first described in the late 1800s: symbiosis. A symbiosis is the phenomenon of unlikely organism (FinTech and traditional organisations, in this case) living together in harmony in a mutually beneficial agreement.

Express Current Account for your front-line

You’ve probably heard the case for businesses empowering their front-line staff to delight customers and provide spectacular service recoveries (maybe your business even does it too). In many cases, these staff members have a budget they can spend on these individual interactions with customers. This can leads to burdensome processes to record, book keep and budget.

Tide is a current account platform which gives you a sort code and account number in five minutes, has no monthly fee (but a small transaction charge) and a credit card. And to put the cherry on top of the cake, they provide smart tools to streamline bookkeeping, admin and invoicing directly on a smartphone – accountant-free, which makes it incredibly easy to maintain afloat.

The above scenario would be significantly streamlined if a business was to open a current account for each of their locations, where they would deposit their ‘recovery allowance’ and harness the power of the automated reporting which allows tracking the expenses whenever required (i.e. as a source of insight alongside Voice of the Customer data or localised performance management).

A bank might well want to enter this space, and so they could. But with current accounts not being the most profitable products they can offer (it tends to be more of a step towards more profitable products such as mortgages), most banks would be better off allocating valuable resources into enhancing experiences delivered through critical journeys more in line with their leading products.

(Very) short-term ad-hoc car insurance

Remember the last time you had to borrow someone else’s car? It’s a conundrum where someone must choose between breaking the law and getting a hefty fine, or much paper work and headaches involved for a journey that could be as short as an hour.

Cuvva understands this is a broken journey many consumers are facing which is why they build an entire subscription-based business around this. Their offering is simple: drive any car by the hour, only pay for what you use and be insured in a matter of minutes rather than days whenever you need to drive a new car. Their product enables you to protect the car owner and yourself without even affecting their policy and their no-claims bonus.

In short, it’s a pay-as-you-go service for your car insurance. Obviously, as many services of this type, the minimum unit (here the hour) costs significantly more than if it was part of a tariff, but it does enable a quick, headache-free resolution to a pain point that is all too familiar to car insurance policyholders all over the UK. Unfortunatley, for some drivers, they are unable to find a good insurance quote for their car as they previously have had a driving conviction that has meant recurring issues with their insurance, because of this, they will have to stop driving as they can’t afford or get the premiums that they need. They can find a specialist car insurance broker on sites such as onesureinsurance.co.uk, who can go through their options and give the driver the best deal available according to their circumstances.

This service could be easily mimicked by leading insurers but would signify a complete change in their business model should they want to follow a more pay-as-you-go approach. And people who are always on the road will probably prefer a tariff, which would represent a better deal for them. If you’re interested in learning more about FinTech and its security, check out Geek Insider for more information.

How does this make a FinTech symbiosis?

A symbiosis is the phenomenon of unlikely organism (FinTech and traditional organisations, in this case) living together in harmony in a mutually beneficial agreement.

The offerings of tide and Cuvva are very niche and cater to an audience that is thus far inadequately catered to by the more established players. Yes, they are probably taking some business away from them, but it does not represent the core segment in their customer base (with traditional players investing heavily in CX, the journeys were simply too broken for these to be a priority).

On the other hand, it would be an extremely resource-intensive and herculean task for Cuvva to take on the leading insurers or for tide to become a full-service bank. With Cuvva and tide catering to these niche needs and the rest of the industry providing services to the greater population, FinTech finally found its place in the consumer landscape – not in antagonism but, on the contrary, co-habiting harmoniously. This new-found symbiosis is what I call: ‘next practice in the making’.

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3 success factors when implementing customer experience best practice*

This article was first published on Nunwood.com – the Customer Experience Blog. It is the exclusive property of KPMG Nunwood, part of KPMG in the UK.

[KPMG Nunwood believes] in identifying the driving forces behind creating great experiences and helping [their] clients implement superior experiences on the back of this insight. Understanding the DNA of these experiences is one of the contributions brought by [their] yearly customer experience leader rankings both in the US and in the UK. These rankings (and accompanying reports) are dedicated to showcasing what customer experience best practice looks like.

However, implementation is not as easy as it might seem; it requires a certain degree of know-how. Here we reveal three vital success factors to have in mind when you want to bring best practice inside your organisation.

1) Begin with the customer in mind

Although it might seem trivial (or too obvious to be pointed out), having the customer in mind is not always a given when companies want to implement best practice. Having the customer in mind is to always consider the impact decisions might have on them and how they’re likely to react or feel. Too often, organisations will invest significantly (in terms of people, resources and assets) to implement customer experience best practice in their industry only to realise that their customers do not welcome nor value the newly implemented initiative. Knowing what your customers want to see in your business will help to put you in good stead when it comes to providing them with good service. As such, digital marketing agencies like Epsilon can help you to base your strategies around your own goals. Whether that be improving customer experience, or looking at how personalized engagements can help to increase revenue, they can provide you with the assistance you need to achieve this. With that being said, when thinking about improving the experience you deliver, think about what your customers value, what changes would make the experience better and how this best practice would apply to their case. It is therefore critical to acknowledge (and work with) the fact that different types of customers have varying needs and motivations to do business with brands. Best practice for one customer base might be worst practice for another: if you mostly service more senior citizens, do not simply assume that the latest mobile banking innovation is the key to improving the experience you offer them: get to really understand them and make them the center of your strategy, not a bystander. Although a mobile banking service like those provided by the bank on this website https://atlanticunionbank.com/personal/online-mobile-banking/ can help the convenience for customers. A mobile banking app provides applications like transactions between personal accounts and other people’s accounts as well as organizing their funds. A PR business like NGP Integrated Marketing Communications, can help you create new business by shinning your business in a better light.

2) Translate success across industries

By putting your customer first, you are enabled to understand them, what they enjoy and where their pain points sit. From there, adequate solutions can be sought. In a number of cases, a suitable approach to solving these pain points might exist as a ready-to-go solution, having already been implemented by a different organisation. However, do consider obstacles to implementing another’s approach: their solutions might not fit your customer base, and will likely be strongly linked to their brand or even patented.

Leaders that will stand out are those that are able to look beyond their industry and see how they could transpose customer experience best practice from different fields to their organisation. In this instance, going beyond the feature of a solution and understand what benefit it brings to customers is the key. An organisation that decides to simplify its journey by removing stages might inspire you to redesign your own journeys as a more seamless experience to customers, by identifying a stage that might not be necessary to the customer’s. Other brands can challenge you to rethink how to best use your floor space in physical locations to showcase your brand or sell your products –it’s not about the solution they offer, but how they decided to solve an issue. Organisations that understand these principles and successfully translate success from industry to industry are a step ahead of their competitors. For these forward-thinking leaders, sky is the limit when it comes to being inspired.

A country’s culture does matter

When organisations realise they can draw inspiration from examples outside their industry or country, they can, sometimes, dismiss the role of the culture. When you seek the solution in far countries or drastically different industries, be aware of the risk of failure due to a cultural mismatch.

For example, USAA, the leader of our 2016 USA Customer Experience Excellence ranking has implemented on its smartphone apps biometric technology, for customers to log on literally with the blink of an eye. USAA is an organisation that has been recognised for its strong Empathy and Resolution – hinting to the fact that this innovation certainly was customer driven. This innovation is very forward thinking and it might not be appropriate to your market in another country. Maybe the majority of customers have a general distrust of their financial services provider, maybe the most popular smartphones are not even able to handle such a technology (or they might not even be smart in the first place).

Taking another perspective, in some fashion retail spaces in Brazil, staff are trained to understand and display very high level of empathy. With a few probing question, they get a deep understanding of who you are, what you’re looking for and for what occasion you’re looking to buy your next outfit. Although very fitted to the local culture, it would come as no surprise it would be considered overstepping boundaries and invading personal spaces in most European markets. This is the clear example of customer experience best practice that might backfire if one decided to implement in the United Kingdom. They might reach a very high level of Empathy, but it would appear to be excessive and intrusive to the customer base of every single major fashion retailer in the UK.

And even if it all works out…

Keep in mind that best practice is all around us. As such, focusing on others’ customer experience best practice might not offer you a comfortable lead in your industry, but will certainly provide inspiration and aspiration. The best innovations you can implement are driven by your entrepreneur employees (discussed in a future article) and by your customers. To ensure you effectively capture what your customers yearn for and uncover critical pain points, you must implement a successful voice of the customer programme.

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Customer Experience Best Practice: Tesla the Disruptive*

This article was first published on Nunwood.com – the Customer Experience Blog. It is the exclusive property of KPMG Nunwood, part of KPMG in the UK. It was then re-published on Engage Customer.

Tesla has been all over the news and is one of the newest disruptors around. Point in case: this month, Tesla, led by the visionary Elon Musk, established an expressive record: the biggest ever launch for a product totaling more than £10 billion worth of revenue (in reservations for its Model 3).

Musk’s company started in 2003 with its entire business revolving around providing a fully electric car and with free recharge. For years, they were laughed at, and discredited. Until their first model, the Tesla Roadster, hit the American market in 2008. What led to such success goes far beyond the product (although it has been designed brilliantly with the help of things like these solvay composite materials): experts report loyalty and advocacy levels that are simply unheard of.

Tesla happens to be a great example of customer experience best practice and how a successful strategy can redefine the state of the art customer experience design.

Tesla rethinks the selling and customer service models

In the automotive industry, carmakers focus on the product and marketing of their products and leave the selling and customer service to their partners. Customer satisfaction is very important and needs to be put at the top in the automotive industry, luckily there is software such as Visitor Chat that can help achieve this type of outcome when dealing with customers. Tesla doesn’t have any reselling partners and its electric cars do not require as much regular maintenance as a traditional car, this is because of tesla’s charging system. More importantly, the retail location is not primarily focused on selling (unlike dealerships) but rather on allowing customers to experience the brand, its philosophy and get a feel for the cars. The differential of Tesla Motors is that it takes ownership of the experience, which, in their case, is a clear customer experience best practice strategy.

When you purchase a Tesla (be it online or in the store), the car will be delivered to you, wherever you want it. Or you could pick it up at the factory and get a free tour of the factory with your friends.

If there are any issues with your car, they’ll pick it up, provide you with a replacement car and repair it – removing the need to bring the vehicle to the repair centre. If the issue is related to its software, the engineers can in many situations update the car, at a distance, during the night and have the customer delighted the next morning. In many instances, car owners were offered spontaneous updates and extra features at no cost. These aspects of the Tesla experience are unique to the carmaker and are excellent examples of their customer experience best practice through actions in the Expectations and Time & Effort Pillars of customer experience. No wonder customers are loyal and more than 300,000 people reserved their Model 3 (launching in 2017, some people will have to be willing to wait at least a couple of years before being proud owners of a Tesla car)!

A full service approach

Tesla goes beyond offering a great product and exceptional support around it. Their commitment to their vision is so strong they actually have put together a comprehensive network of recharging stations across the United States and Europe. Its charging stations are conveniently located on the highway and near hotels, shopping malls and restaurants they partner with.

The real learning from the approach Tesla takes to the network can help shape many customer experience best practice strategies.

The network is necessary for Tesla to sell its fleet of cars. But beyond that, the tech-company offers their customers a clear trade-off: free or fast. The supercharger offers a 50% battery charge in only 20 minutes – and is free for life on its Model S (to the best of our knowledge, it hasn’t been announced whether this will be carried on for the Model 3). But what if 20 minutes is too long for you? Provided you’re willing to pay the equivalent price of a regular gasoline tank fill, you will be able to exchange your car’s battery for a new, fully charged, one. The time it takes? Reportedly, 90 seconds.

The reason their strategy is so critical

Tesla is in the enviable position of defining what customers will come to expect from the automotive industry. This will ultimately end up being reshaped according to their own strengths and ambitions; a strategy to which competitors will have to abide by. This is true customer experience best practice.

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Customer Experience Transformation: Who’s replacing the cash machine?*

This article was first published on Nunwood.com – the Customer Experience Blog. It is the exclusive property of KPMG Nunwood, part of KPMG in the UK.

After having explored in this series of articles how customer experience design transformed the retail and the travel industries, let us have a look into financial services. And in specific, how customer experience transformation is finally threatening to replace the iconic ATM after half a century of existing. To provide some context, in 2014 there was a reported 2.8 billion ATM cash withdrawals in the UK alone.

A hybrid between the ATM and your branch staff

Similarly to the NextAgentTM from our last article, the ITM (Interactive Teller Machine) is the combination of the traditional ATM with an actual teller, thanks to a video-feed. This customer experience transformation brings critical benefits for banks and building societies.

They could facilitate the survival of more rural branches by having the staff at these branches support the more in-demand locations at peak times – addressing any bottleneck in the network. As a consequence, it allows them to optimally service their entire customer base while optimising resources. This will also facilitate the extension of personalised service beyond regular banking hours, making it more convenient for busy professionals (excellent for the ‘Time & Effort’ pillar of Customer Experience Excellence). The next evolution of the ITM is probably the ‘Janus’ by company Diebold. The Janus is an ITM servicing two customers at the same time (with the same electronical resources) while respecting their privacy and reducing the floor space required to serve customers in-branch.

The numerous advantages are obvious for a bank or building society. Although it is geared towards providing a better customer service, it is yet to be determined if this innovation in customer experience design will prove to be a sustainable way of redefining our banking interactions.

Bring your own device to withdraw cash

Meet Irving, one of the greatest contenders for a disruptive customer experience transformation within financial services in recent times. Created by Diebold as well, it differs from Janus (the ITM) in that instead of enhancing interactions, it strips away steps and provides a streamline service to customers. It can allow you to withdraw cash in as little time as ten seconds. With this machine, you keep your card in your pocket, everything is done through your very own device (BYOD – bring your own device): there isn’t a screen, a card reader or a pin pad, only a cash dispenser. Behind theses minimalistic appearances, security is reinforced as authentication is done through the customer’s smartphone and cash can be requested through NFC, QR or biometric technologies.

In an age where customers are more and more comfortable to do their banking on smartphones (and in the near future, smartwatches), the Irving is only a logical extension to this ever growing habit. Offering fast, seamless and secure (provided you don’t lose your device transactions), the machine presents a great potential to seduce tech-savvy and time-poor banking customers. In late 2015, it was announced that an American bank was testing the concept in New York.

Although both concepts explored here are indeed great steps forward for customers and genuinely represent a true customer experience transformation, there are still obstacles ahead that might nip it in the bud. The most critical of these factors, ironically, is about the customer: we need to ensure we bring them on board.

Along with adopting and implementing these new facilities, it is key to ensure customers are educated appropriately on harnessing the power of the new devices if adoption is to be expected. If this process is not carried out properly, there’s little reason to believe that a screen-less ATM will put our iconic and traditional ATM into retirement.

Banking the Customer Experience Dividend: The £3.7bn opportunity

Fortunately, replacing the ATM is not the only way of seizing opportunities with customer experience. [KPMG Nunwood] research clearly shows that customer experience transformation represents a massive opportunity in terms of revenue for the ‘Big 4’ banks (making abstraction of the ATM replacement).

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Reinventing travel through customer experience design*

This article was first published on Nunwood.com – the Customer Experience Blog. It is the exclusive property of KPMG Nunwood, part of KPMG in the UK. It was also re-published on Engage Customer.

There is no contest the digital era completely changed our lives. We discussed last week its effect on retail and how retailers are now adopting digital into their strategies. Today, we’re focusing on how technology and new entrants in the industry have redefined how we travel.

The internet allowed for companies to operate without the high fixed costs of a developed brick and mortar network, increased collaboration across a territory and an easier access to their customers.

The emergence of low-cost airlines – partly driven by this evolution – gave access to travelling to a much larger population than ever before. As a consequence, the likes of EasyJet and RyanAir in Europe or Southwest Airlines and JetBlue (52nd in the 2015 US CEE Ranking) in the United States put a major pressure on the traditional carriers to justify the price premium they request for their services.

This is a great opportunity to explore two ways customer experience design innovation is redefining the way we travel, be it by rail or by plane.

American Airlines now in control of their customers’ wider journey

One of the major Achilles’ tendons of the airline industry is its dependency on third parties. The way to and from the airport, together with the journey and services within the airport is outside of the airline’s control. Therefore, there always is a risk for the experience of the traveler to go south although the airline has done everything perfectly. The performance and success of airlines lie in part in the hands of these partners. American Airlines decided to address this lack of control by launching a partnership with Uber, the ride-sharing app. This partnership will mean that there will be an extended fleet of drivers, which will be highly helpful in situations like this. American Airlines and Uber can use companies such as Lytx for fleet safety to make sure everything is done all above board and smoothly for everyone involved.

When customers receive their booking confirmation for their AA flight, a clickable link “Remind me to Uber” will be included in the email. This feature is currently available across 11 airports in 10 American cities. The partnership becomes even more interesting for AAdvantage members (their frequent flyers programme) with a certain status, as they are benefiting from a $25 off voucher for their next Uber ride (regardless of whether they are Uber customer or not). Customers owning an American Airline’s credit card will receive bonus miles for all Uber rides taken until July 31st 2016. These kinds of perks can be found on many US cards, which is why you may want to consider getting a Chase Sapphire Reserve Canada card if possible.

By encouraging its customers to use Uber to travel to and from the airport, AA can work towards offering a better journey to its customers, by making Uber directly accountable for this part of the customer journey. This can even benefit those who use a private jet card program. With Uber being accountable for you transfer from and to the airport it does mean that if you are involved in an accident whilst in the Uber then you will need to make a claim against the Uber driver and not the airline, the best way to do so is to contact an Uber and Lyft Accident Lawyer.

Plan your train journey with a video call

Flying is not part of most people’s daily commute, unlike rail travel. One of the most exciting customer experience design inventions is brought to us by Cubic Transportation Systems, the company which co-developed Transport for London’s contactless payment system in its Underground network.

The NextAgentTM is a virtual ticketing agent system. In a nutshell, this machine combines a ticketing office and a help desk with a video call. Customers can communicate in real time with a real life expert through a video link. This all-in-one machine ensures customers are serviced in a prompt and consistent manner across the rail (metro or train) network, from the busy metropolis to the secluded or underserved train station.

In terms of customer experience design, this contributes greatly to the Time & Effort, Expectations and Personalisation pillars across the rail network.

The system was first announced in 2013. Deutsche Bahn (the German railway company) was reportedly trialling it in the same year. Since 2015, the railway company Abellio Greater Anglia (in the UK) has been trialling the system which has received a positive response from customers. As a matter of fact, the system has been so successful that in February 2016 the company decided to add these terminals within the Stansted Airport rail station.

The next few years will tell if this technology will spread across the different rail networks and revolutionise rail travel for good despite its important infrastructure requirements.

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