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Complex ImperativesThe Indian Banking Customer Experience
May 2010
Accenture Research
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Emerging customer behaviours, changing demographics,and increasing technology options are driving banksin India toward new challenges and opportunities.Banks today are serving a more complex customerbase: more diverse geographically, more varieddemographically, and dotted with entirely new buyersegments. These complex imperatives have broughtwith it an increasing debate about customer acquisitionand retention. One of the major challenges faced bybanks is the ever rising customer expectation. Customerexpectations are rising while their sense of loyalty is
falling. The rapid advance of communication technologyand electronic commerce has eroded customer loyaltyby creating more convenient access to productinformation, purchase options and services.
Introduction
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To help banks navigate the challenges and opportunities of thiscomplex landscape, Accenture has developed The Indian BankingCustomer Experience, an extensive survey aimed at gaininga deeper understanding of the Indian customers behaviour,expectation and satisfaction of banking services, with a specialfocus on distribution touch points.
The findings provide fascinating insights into the customerschanging imperatives, perceptions and priorities within thebanking space. Overall, the research yields four key findings,each of which brings significant implications for the future
strategies of banks. These key findings are: Traditional channels continue to drive usage
Alternate channels are yet to gain customer acceptance
Customer satisfaction is a function of expectation
Customer experience is driving the bank of choice
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This quantitative research is basedon a 30-minute interview conductedface-to-face with 3,459 bankingcustomers between September andNovember 2009. The sample wasspread across gender, age and locationin India, covering retail customers of eleven banks from both public andprivate sectors. Respondents wereactive banking customers, implyingthose who had a bank account for atleast three months with the primarybank and had done business with theprimary bank in the past year at thetime of survey. Core sections wereanswered by all respondents, howevernot all respondents answered the
questions to every channel they used.Further, respondents who used severalchannels may not have answeredthe questions to all channels.Data collection was completed forAccenture by IMRB.
Methodology and sample
Customer profile/channels included in the survey,with numbers of participants
Respondents by Banking Channels Respondents by Age
Bank branch 1,396 18-26 yrs 802
ATM 712 27-35 yrs 1,359
Internet 555 36-45 yrs 881
Call centre/ Phone Banking 483 46-60 yrs 417
Mobile Banking 313 Total 3,459
Total 3,459 Respondents by LocationRespondents by Gender Urban
Male 2,781 Delhi 507
Female 678 Kolkata 462
Respondents by Primary Bank Mumbai 522
Public sector banks (3) 955 Chennai 543
Private sector banks (6) 1,892 Semi-Urban
Foreign banks (2) 612 Lucknow 276
Total (11) 3,459 Bhubaneshwar 415
Baroda 382Kochi 352
Total 3,459
Figure 1.
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Key finding
No. 1
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Customers preference for traditional
banking channels i.e. Branch and ATMcomes across prominently in our study.There are over 65,000 branches andnearly 44,000 ATMs of commercialbanks across India. These two channelscontinue to dominate customerpreference. Over 78% respondentsmentioned the Branch and ATM as thepreferred channel for priorities suchas accessibility, quality of service andspeed of problem resolution.
Although traditional channels continueto engage customers, there are uniquedemands and expectations for thealternate channels such as mobileand internet. Contrary to commonperception, alternate channel bankingis not necessarily impersonal. Thesurvey indicates market segmentationof customer needs about who and/or when to transact at each deliverychannel. The preference for alternatechannels is influenced by the type of banking activity. The preference is
higher among men, reduces with ageand increases with educational level of the Indian customer.
The differences among customersegments provide unique insightsfor banks particularly in light of thecountrys changing demographics.Early adopters of mobile banking forinstance, are predominantly young,male, and more affluent even inmature markets of United States andCanada. However these factors gainhigher prominence for India whichis seeing its demographics shiftincreasingly toward the young andworking population. Since majorityof the working population in the2540 age group has a high disposableincome and are banked and tech-savvy customers, banks typicallyconsider this age group their targetaudience. The 2040 age group isexpected to have 450 million peoplein India by 2030, potentially creating
a huge population for the delivery of
banking services through alternate
channels. Mobile banking will be thenext revolution in the way financialservices are marketed, bought anddelivered in the coming years by thisyoung population. Mobile banking willalso be a critical driver of financialinclusion as it is nearly impossible forbanks to build a brick-and-mortarinfrastructure for retail banking inrural India. Despite the large numberof branches across India, theircoverage of population is abysmallylow compared to mature countries.The average coverage is about 18,000people per branch in India, against3,600 in the U.S. and 4,800 in the U.K.This national figure does not highlightthe regional differences in densitywhich is far lower in rural India.
The need to promote alternatechannels is undoubtedly high. Howeverour survey indicates that customersare currently using mobile bankingfor very basic activities like checking
account balances and statements.Generating greater growth of mobilebanking services will require banks toexpand the offering and focus moreheavily on messaging that addressesthe target customer segment. There isa need to segregate between youngaffluent versus rural or semi urbancustomers. E.g. affluent customerswith high end phones look for complexfunctionalities. In countries like Japan,phones with finger print encryptionare almost becoming a necessity dueto the wide usage of mobile wallet.Rural customers seek sms (shortmessage service) based authentication,simple features and very low or almostnil charges. Likewise, generatinggreater growth of the online channelwill require banks to appropriatelydesign the website and messaging tosuit the specific needs and bankingpatterns of the young versus agingpopulation, urban versus rural etc.
Traditional channels continue todrive usage
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Finding No. 1: TraditionalChannels drive usageATMs continue to dominate sinceit offers the most efficient andeasy accessible means for cashwithdrawals for a large segment
of retail customers. Preference forthe Branch is stronger among thecustomers of public sector banks.A high percentage of retail accountholders have three types of bankingrelationships with their bank savingsaccount, fixed deposit, and debit card.Their basic needs with regards to theprimary products are well met throughtraditional channels. The accessibilityof these channels is the key factor foraccount holders in short-listing a bank.
The preferred channel to transactbanking differs by age, gender andlocation:
Urban respondents have a greaternumber of users for non-branchchannels such as ATM (higher by 9%)
The proportion of ATM usersdecreases with age in favor of theBranch
Respondents from the older agegroup value problem resolutions morethan the younger generation, whileworking hours and accessibility areimportant to the younger generation
Women have a greater preferencefor the Branch channel
The use of Internet and PhoneBanking increases with educationallevel over 35% graduate & highereducated sample had a preference forInternet and Mobile versus 9% in theless educated segment
Figure 2. Profile in terms of preference of channels and which one do you preferusing for transacting business?
Mobile Banking 4%
Call Centre/Phone Banking
6%
Internet 12%
ATM
31%Bank Branch
47%
Source: Indian Banking Experience Survey December
*Base only includes respondents who currently use channel Base=3459
Source: Indian Banking Experience Survey December
Hum an contact/ Interaction provided by channel 21%
Problem resolution capabilities of the channel 42%
Cost of availing the service through channel 42%
Working hours for the channel 51%
Security of the channel 55%
Speed of service through channel (Less or No waiting time) 60%
Quality of service through channel (No errors made) 63%
Accessibility of channel-Anywhere 66%
Summary
Figure 3. Preference for usage of channels
You mentioned you prefer using ___________(specific channel) Why do you feel this way.
*Base only includes respondents who are using the channels
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The preferred channel to transactbanking differs by type of activity:
ATMs are most often used forchecking balances and withdrawingcash
Internet banking is most often
used for account statements, moneytransfers and payment of bills
Call Centre/Phone banking is mostlyused for administrative purposes suchas requesting debit/credit cards orcheque books, stop payments andcomplaints
Mobile banking is most often usedfor checking balances and accountstatements
Bank Branch ATM Internet Call Centre/Phone Banking
MobileBanking
Issue demand draft 85% 0% 16% 10% 0%
Obtaining documents/Forms for banking needs
82% 0% 22% 14% 0%
Making a Fixed Deposit 81% 2% 7% 4% 2%
Request for Debit/ Credit card 76% 0% 21% 26% 0%
Application for loans 74% 0% 19% 18% 7%
Transfer Money 71% 10% 37% 6% 9%
Request for cheque book 68% 4% 29% 35% 19%
Stop cheque payment 68% 0% 24% 31% 24%
Payment of bills 67% 6% 32% 6% 5%
Change of ATM/Internet banking password
46% 27% 34% 13% 13%
Account statements 41% 31% 43% 22% 26%
Checking your balance 18% 57% 32% 21% 30%
Withdrawing cash 15% 90% 0% 0% 0%
Base=2996Source: Indian Banking Experience Survey December
Figure 4. For each activity which channels would you use?
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Key finding
No. 2
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Alternate channels usage though
consistently on the rise, is stillstruggling with customer acceptance.Low awareness levels are driving thelack of need and hence poor usage.The greatest barrier for respondentsin using multiple channels is that theydo not feel the need to use a differentchannel as well as the low awarenessfor internet, phone and mobilebanking.
From banks point of view, the costper transaction at a Branch is almostthree times the cost at an ATM.Electronic channels namely, internetand mobile banking are even more costeffective. Celent estimates the costper transaction in India to be US$1.14for Branch banking, US$0.46 for ATM,US$0.23 for Internet and US$0.09 forMobile banking. There is tremendouspotential for banks to cut down thecosts by encouraging customers to usealternate channels though customeracceptance alone can drive this shift.
Despite the high penetration of mobilephones in India, mobile banking isnot widely adopted owing to theaccessibility of traditional channels butalso owing to limited efforts by banks
to onboard customers. Understanding
the customer experience of alternatedelivery channels will enable banksto transcend the barriers in the mindof customers by suitably designingthe channel offering and marketingmessage to foster channel adoption.Interestingly, a promising findingof our survey is that customers areopen to the idea of trying out newchannels. The positive trend is thatnearly 40% of respondents indicatethey are planning to use at least onenew channel in the next six monthsto interact with their primary bank.To capture this opportunity of newusers for alternate channels, banks willfirst need to ensure an integrated andconsistent service experience acrossthe multiple channels.
Alternate channels are yet togain customer acceptance
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Finding No. 2: AlternateChannels yet to gainacceptanceAlthough respondents generally donot feel the need to use non-branchchannels, this barrier is lower in the
younger age group.
Over 40% of the respondents in theage group of 46 60 years did not feelthe need to use any non-branch/ATMchannel
Between 28-30% of the respondentsacross age groups demonstrated lowawareness of the channels or service
Service quality, convenience &security concerns accounted for lessthan 5% of the overall responses
*Only top mentioned responses noted
Source: Indian Banking Experience Survey December 2009
Figure 5. Please can you tell us what comes across as barriers to you in your usage or your
intention to use the particular channel?
Base=3459
Main themes* BankBranch
ATM Internet Call Centre/Phone Banking
Mobile
Accessibility is a problem/No facility
17% 14% n/a 2% 1%
Lower awareness about service/channel
n/a 7% 31% 28% 29%
Do not feel the need to use/thechannel satisfies my needs
9% 39% 37% 41% 38%
Additional charges n/a n/a 2% n/a 2%
Do not know about the securityof the channel
n/a 3% 3% 1% 1%
Channel convenience 41% 11% 2% 4% 3%
Service is not prompt 21% n/a n/a 3% 16%
No knowledge on using the internet n/a n/a 8% n/a n/a
Additional other barriers notapplicable to the above
12% 37% 11% 16%
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Key finding
No. 3
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Customers not only prefer to use
traditional banking channels but theyare also more satisfied with traditionalchannels they use. Preference fortraditional channels is driven bycustomer perceptions of accessibilityand quality of service. ATM as achannel has the highest satisfactionamong the user base, even higherthan the Branch. Almost 50% of the respondents prefer transactingbusiness with the ATM. This findinghowever should be interpreted inlight of the type of activity for whichthe channel is used, as well as thecustomers expectations from theirprimary bank.
The complexity of customerexpectation is magnified bydifferences in age, education leveland location. Those banks cateringto a more affluent customer segmentgenerally had lower satisfactionratings in our study. Younger,educated customers and those based
in semi-urban areas have higherexpectations from their bank in termsof accessibility of channels, quality of service, speed of problem resolution,as well as lower service charges
and competitive rates of interest.
Respondents in semi-urban areas aregenerally more dissatisfied with thecost of service charges. Our follow-upanalysis to this response reveals thatservice charges levied by public sectorbanks typically tend to be lower thanthose levied by private and foreignbanks. The customer is either unawareof their primary banks publishedschedule of charges or obliviousto the value-add in accompanyingservices. Better communication andtransparency can go a long way inmanaging customers expectation onservice charges, and consequently,their satisfaction ratings.
The broader challenge however is thatcustomer expectations for servicehave been continuously increasing andbanks seem to be falling short, despitethe improved perception of servicequality. The annual banking systemsurvey released in February 2010 bythe Federation of Indian Chambers of
Commerce and Industry reinforces ourfinding from the standpoint of banks.According to the FICCI survey, banks inIndia rate their number one challenge(on a mode scale of 1 to 7 with 1 being
the biggest challenge) today to be the
"ever rising customer expectation".Banks rated ever rising customerexpectation ahead of their next bigchallenges namely, risk managementand maintaining the growth rate.Transition from class banking to massbanking and increased customer focusis drastically changing the landscapeof Indian banking. Erosion of priceand feature advantages across banks,and price sensitivity is leading to anincreased propensity for customersto switch. Emerging collaborationtechnologies have the potentialto dramatically improve the speedand quality of service interactions.However, these need to be betteraligned to customer behaviours differences in customer segments,geographies, and demographics haveto be considered while defining thetarget experience across channels.Banks need to design a model that isclosely aligned to the distinct needsand preferences of their most valuableand profitable customers.
Customer satisfaction is afunction of expectation
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Finding No. 3: CustomerSatisfaction isATM as a channel has the highestsatisfaction among the user base.However one needs to read this inlight of the activities for which eachchannel is normally used.
Bank BranchCustomers of public sector bankshad a higher satisfaction percentagevis--vis private & foreign banks.This is influenced by the customerexpectation from these channelswhich in turn is influenced by thecustomer profile (education, age etc).Banks catering to a more affluentcustomer segment generally had lowersatisfaction ratings.
ATMOverall satisfaction levels weresimilar across banks except for threeprivate sector banks. Our study clearlyindicates that the satisfaction withBranch increases whereas satisfactionwith ATM decreases with age.
For instance, in the age group of 27-35satisfaction levels with ATM were 63%vs. 51% for Branch.
Internet & Mobile BankingPrivate Sector and foreign banks hadhigher ratings vis--vis public sectorplayers. Even though the younger &
educated segment preferred thesechannels, their satisfaction waslower. There is a gap between userexpectation vis--vis service deliverythrough these channels.
Call CenterThere were similar trends across bankswith 3 exceptions.
Figure 7. Satisfaction with Channels
We would like you to understand how satisfied you are with the channels you have used?
Extremely Dissatisfied
(1:25)
Somewhat Dissatisfied(26:50)
Somewhat Satisfied(51:75)
Extremely Satisfied(76:100)
BankBranch
3%19%
27%
51%
ATM2%13%
25%
60%
Internet4%
20%
27%
48%
Call Centre/Phone Banking
5%
27%
31%
38%
MobileBanking
6%
26%
25%
43%
*Base only includes respondents who currently use channels
78% 85% 75%69% 68%
Summary of All Channels Used
Base=3459
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Bank Branch ATM Internet Call Centre/Phone Banking
Mobile Banking
Security of the channel53% 48% 54% 48% 56%
Quality of service through channel48% 48% 53% 49% 52%
Speed of service through channel44% 53% 55% 50% 52%
Problem resolution capabilities of the channel 44% 40% 49% 43% 50%
Working hours for the channel42% 49% 52% 47% 49%
Accessibility of channel41% 45% 51% 51% 53%
Human contact/ Interaction providedby channel 39% 33% 36% 41% 42%
Cost of availing the service
through channel38% 42% 44% 46% 38%
Figure 8. How satisfied you are with your primary bank for the following factors?(Satisfaction rated on a scale from 1 100 with 1 being very dissatisfied and 100 being very satisfied)
*Note that only the Extremely Satisfied scores have been mapped hereHighest Lowest Top Two satisfaction factors
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a function of CustomerExpectationThe expectation of customers fromtheir primary bank differs by locationand age profile:
Respondents from semi-urban areas
in their relationship and interactionwith their banks have greaterexpectations than urban respondents
- Respondents in semi-urban areas arekeener than their urban counterpartsthat their bank offer competitiveinterest rates and lower user charges.
- Respondents in semi-urban areasare more demanding on the qualityof service and expect their bank tobe more effective in communicatingproducts and services.
Younger customers in theirrelationship and interaction with theirbanks have greater expectations thanolder customers aged over mid-40s
- Respondents in the 46-60 yearsgroup have lower expectations withregards to ATM/Branch coverage thanthe 27-35 years group.
- Respondents in 36-45 years agegroup are more particular about their
banks quality of service compared toother age groups.
- Speed of problem resolution isslightly more important to the under35 years than above.
Figure 9. Thinking about your relationship and interaction with your bank, what are the keyexpectations you have from your bank?
Should offer accessibility throughmultiple channels 24%
30%
Effectiveness in communicatingon its activities, product 24%
35%
Should offer me good investmentopportunities 25%
30%
Should be technologically advanced26%
32%
Give variety of products/services available28%
33%
Better online banking platform29%28%
Offer Personalized services3 1 %
44%
Should offer competitive interest rates/loan rates to cus 33%
40%
Knowledgeable and responsive phone
banking support 33%
32%
Customer service should be more helpful39%
43%
Quality of Service (No errors made)40%
52%
Longer branch banking hours40%
42%
Courteous service at branches40%
46%
Transparency in levy of charges42%
46%
12%11%Should improve its Brand Equity
The bank should be more secure and reliable44%
48%
Lower user charges48%
54%
Shorter queues at branch43%42%
Better ATM coverage55%
59%
Speed of problem resolution60%
78%
Better branch coverage 55%53%
Source: Indian Banking Experience Survey 2009 Base size = total sample Base=3459
Urban Semi-Urban
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Figure 10. Thinking about your relationship and interaction with your bank, what are the keyexpectations you have from your bank?
Source: Indian Banking Experience Survey December Base=3459
42
54
56
60
69
49
51
57
44
4951
50
65
40
45
50
55
60
65
70
Quality of Service(No errors made)
Lower usercharges
48
Better branchcoverage
53
Better ATMcoverage
Speed of problemresolution
46-60 yrs36-45 yrs27-35 yrs18-26 yrs
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What every organization should know about customer loyalty
Know where loyalty begins
The factors that create and influence customer loyalty begin to take effect evenbefore a customer becomes a customer. The relationship a customer develops withthe brand during the acquisition stage strongly influences customer value andretention.
Know what to look for
Most companies know a lot about their customers, and comparatively little aboutthe factors influencing acquisition and retention. Achieving high performancein customer retention means aligning activities throughout the relationshiplifecycleincluding acquisitionand using econometric and return-on-investmentanalytics to study and maximize conversion rates and other customer behaviorsacross channels and throughout the lifecycle.
Know every kind of loyalty
Loyalty is not necessarily an emotional connection to the brand. True brandevangelistsor even potential evangelistsare at best rare and possibly non-existent. Companies need to recognize, develop and manage more than one kindof customer loyalty: conditional, emotional and passiveusing more than one kindof strategy.
Know what to measure
Companies often measure the wrong things when trying to measure customerprofitability and loyaltyloyalty indicators are far more involved than customersatisfaction scores. Establishing and managing cross-functional key performanceindicators throughout the customer lifecycle helps prevent the loss of current andpotential customer value.
Know how the value chain affects loyalty
Third-party channels and routes to market also affect customer loyaltyand candestroy unless they are managed effectively. Analysis and decisions concerningsuch factors as offers, sales incentives, pricing, service deliveryall dimensions of the customer experienceshould include all the trading partners who contributeto the customer experience.
Know how to manage complexity
Products, service bundles, channelsthese and many other factors have grownexponentially more complex in recent years, making customer loyalty morecomplex to manage well. Providers must retain the ability to react quickly tochanging customer needs and market conditions.
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As brands become increasinglycommoditized and competition growsmore intense, customer loyalty hasall but vanished. In this environment,understanding the factors that driveloyalty, and managing these factorssuccessfully, is critical to stayingrelevant, competitive and profitable.The key is to take a scientific andend-to-end approach to loyaltymanagement, that takes into accountevery form of loyalty and whichencompasses the entire relationshiplifecycle.
Knowing the customer: managing loyalty
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Key finding
No. 4
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Our findings clearly indicate that
customer service delivered viamultiple channels is driving the Bankof Choice. Indians are most likely toconsider good customer service asthe main factor for choosing a bank,cited by over 66% percent of therespondents. While customers havea variety of expectations for goodservice, they care most about howwell informed and personable theircustomer service representative is,how fast and efficiently they receiveservice and how long it takes for theirissues to be resolved.
Customer service is the key factorfor continued relationship withthe primary bank. The level of recommendation is high but variessubstantially by bank. For one bank,80% of respondents were very likelyto recommend their primary bank toa relative/friend/colleague. In anothercase, only 35% of respondents werevery confident of recommending their
primary bank.Better customer service standard isalso the key reason for a customerto switch to another bank. Banks willneed to focus on customer retentionas gaining new customers is subjectto fierce competition and pricingpressures, adding to the cost of acquisition. There is little differencebetween basic products and servicesbeing offered by banks today. In thishighly commoditized market, customerexperience will be the key source of differentiation.
Customer experience is drivingthe Bank of Choice
Satisfied/received good customer service
Prompt/quick service
Is trustworthy/secure
Better branch coverage
Polite/good/proactive staff
Provides good facilities/schemes
Better ATM coverage
Due to salary account
Public sector bank
Proximity to bank/ATM
Long term relationship with bank/been there for long
Transparent in dealings
Can keep minimum balance/low deposit
Serves all my needs/customer centric
Good reputation
Has a global presence
Lower/fair user charges
Good interest/loan rates
Convenient working hours/services
Communicates well/gives information
Private sector bank
Resolves problems/query resolution
Latest technology
Figure 11. Please tell us why you mentioned the following bank as the only bank I would
consider to transact business with?Multiple responsesMain reasons
53%
13%
13%
12%
10%
9%
8%
5%
5%
4%
3%
2%
2%
2%
2%
2%
2%
2%
2%
1%
1%
1%
1%
Base size = total sample
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Investing equally in every customerwhether to gain or retain their
businessis seldom effective oreven necessary. High-performancebusinesses know what it costs toserve the customers they have, whatit will cost to acquire those theydesire, and the lifetime value of theserelationships.
Determine service levels across thechannel portfolio according to thecustomer needs and profitabilitydefined by the new strategy. Typically,this will involve handling most servicetransactions through self-serviceor guided-service channels, whilereserving costlier support optionsfor the more valuable customersand transaction types. Rememberthat emphasizing self-service stillmeans emphasizing good service:personalized, efficient and consistent.
Delivering the customer experience:satisfaction and profitability
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ImplicationsBanks must focus on thefollowing to drive channel
usage and enhance customerexperience:
Right channel andcustomer mix
Well defined customermessages
Structured feedback gatheringand subsequent improvementdriving process
Consistent experience acrosschannels segment, information,service level agreements
Digitalization and innovationto enable banks to retain andacquire customers
Implications for each of theinterface channels are different,varying in terms of prioritiesfor both the customers andthe banks.
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Implications forBranch Banking
Provide a Consistent ButCustomised Experience atthe BranchAt each step of a customers branch
journey, there is an opportunity totransform the customers perceptionsof the bank.
Currently, banks have set up specialbranches for key segments or haveseparately designated areas to offerdifferentiated customer experience.
But on a larger scale, branch levelefforts are limited to providingconsistent look (colour schemes andbranding). The ability to provide aconsistent experience across branches(some parts differentiated forsegments) will drive overall businessperformance. This requires followingkey elements to be addressed:
Attract & Welcome: Every customer isgreeted and offered help as they enter thebranch
Navigate & Browse: Visually distinct,modular areas provide customers with cleardirection on where to go to conducttransactions
Select & Wait: Customers are able to relax incomfort whilst waiting to see an adviser
Interact & Transact: Customers undergofinancial health-checks to ensure they areoffered solutions based on needs
Wrap Up & Leave: Ability to route thecustomer to the most appropriate adviserbased on their needs / profile
Follow Up: Customers can view and confirminformation before transactions arecompleted
Figure 12. Branch Customer Journey Model
Showing the 6 key customer steps during a branch interaction
1. Attract& Welcome
4. Interact& Transact
5. Wrap Up& Leave
6. Follow Up
3. Select& Wait
2. Navigate& Browse
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Focused on customer experience
Generating and Taking advantage of the traffic
Adaptation toClients values Self directed Relationship
Entertaining &Attractive Modern design InnovativeTechnologies
Flexibility throughout the day Advertising according traffic in the branch Work environment changing for sales manager
Modular space according Localized marketing and segmentation Skills of the workforces
Sell & Service oriented No cash no teller Meet & greet sales force Mobile workforces accommodation Close link with CRM tools
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1. Change front line behaviours: Frontline staff behavior has to ensureexcellence at every moment of truthduring the relationship with theCustomer
a. Focus on managing initialexperience First few months of customer interactions will shape theopinion and loyalty significantly.Hence the staff should proactivelyconfirm experience, assist and takefeedback
b. Do need-based selling ratherthan aggressive / campaign basedsales which often leads to negativemoments of truth
c. Offer financial advice and ensureeffective follow-up to inbound.
d. Ensure problem status transparencyand active follow-up maintaininghigh Emotional connect with thecustomer
Culture must be very clear and verypervasive: buy in or opt out. Banksmust select right internal championsto communicate expected behaviors.
2. Deliver differentiated customerexperience with a robust and highlysimplified process and technology
a. Focus on execution excellence:Decouple distribution andproduction with emphasis onthe industrialization approach(workflow-based and process-drivenapplications, reduced paper loadsthough a paperless approach etc.).Ensure optimized processing in orderto reduce the customers time to yesand the Banks time to issue
b. Needs-based Selling & Servicing:Compelling, simple, and clearpropositions in terms of productsand pricing clearly matched againstcustomer needs
c. Fully integrated channels to delivera consistent experience to customers(pre-selling, selling, and post-sellingprocesses designed to span throughmultiple channels)
3. Refine accountability and metrics
a. Build customer centric keyperformance indicators (KPIs) mappingsatisfaction to operational & salesmetrics, customer lifetime value etc.
b. International best practice isto formalize operational KPIs in acharter of services: a real servicelevel agreement with customers
Last but not the least this has to bebacked by a front office architecturethat ensures customer centricity(single view of customer), userfriendliness for staff and efficiencythrough straight through processingetc.
Figure 13. 7 key principles of Branch of the Future
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Implications for ATM
Ensure Ease inAccessibility and Use of the ATMATMs over the last few years haveextended various facilities beyondbasic banking (cash withdrawalbalance check, mini statement, depositcash/cheque, funds transfer etc.)like bill payments, airtime recharges,ticketing etc. However, cash disbursalcontinues to be the most popularfacility. In addition to providingcustomer service, banks have usedATMs to enhance branding and displaymarketing material.
We believe in the future growth of mobile banking with its mobile walletleading to reduced importance of ATMs. Kiosks focused on customeracquisition spread across retail outletswill emerge which will be sales focusedand enable the customer to go beyondbasic banking transactions like detailed
statement print, apply for products &services, use interactive digital framesfor planning and reviewing banksservices across product line.
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Implications for Call Center
Personalize @ CallCenters the only non-branch human interfacechannelBanks continuously make investmentsinto their contact centers but oftenwithout a clear business value. This islargely driven by the need to introduceservices to meet the channel offeringsin the market.
Banks cannot afford to misallocateconsidering the impact to theircustomer experience, brand, employeesand bottom line. Facing thesechallenges, banks need to align theircontact centers priorities around:
Differentiation of the customer to
enhance satisfaction: impactingretention & revenue
Differentiation pre supposes deepcustomer insight i.e. a systematichandling of every customer interactionbased on deep understanding of customer behaviors, preferences andeconomic value
Defining the Customer Experienceacross channels and Lines of Businessto make contacts more customerrelevant - Today there is limitedvisibility of compliant / request statusacross channels. These functional silosresult in a poor customer experience from a customers perspective, it is thebank at fault and not the channel.
Increasing Self Service Utilization Banks have been trying to simplifythe automated systems to enhancecustomer ease of operations for self service. However, often these efforts
are more driven from contact centeroptimization (costs, waiting time etc.)rather than customer experience.Leading technologies like voicerecognition to navigate menu items
& authenticate, personalization of
the menu based on frequently usedoptions will drive traffic towards self service which needs to be backed byrobust straight through processing.Give customer the control to enhanceusage and experience.
Extend Sales to Servicing to expandshare of wallet and improve customerretention This has been a tough
journey for banks trying to developsales competencies and then ensure agood balance between sales & service.Lack of targeted campaigns (repetitivesales messages every time customercalls, untargeted message for thecustomer / segment, too many salesmessages i.e.no control on call tree),inadequate sales training and productknowledge with call representativesand poor follow through for closureacross lines of businesses has resultedin sub optimal results on sales effortsand declining customer satisfaction.Banks need to drive marketing & sales
effort based on indepth customerknowledge to ensure better conversionand satisfaction.
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Figure 14. Increase Operational EffectivenessAchieving an optimal balance of cost, efficiency and customer satisfaction
Increase Self-Service UtilizationAligning self-service capabilities withthe customer most likely to use them
Improve Agent Effectiveness and LearningRecruiting top talent, reducing time-to-competence,continuous training
Extend Sales to ServicingIntegrating sales insight andchanging agent behaviours
Enhance Desktop Tools andCapabilitiesInfusing the desktop withcustomer insight withoutincreasing complexity
Improve Work Flow ManagementFocusing on integration and automation of events and internal & external processes
Infuse Customer InsightSystematic handling of everycustomer interaction base ondeep understanding of consumer
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Industrialization to drive efficiencies
Focus on the integration andautomation of events and internal &external processes
Enhance Desktop Tools andCapabilities to increase sales agentseffectiveness
Improve Agent Effectiveness &Learning through continuous trainingprograms
Centralize Infrastructure (Technology& Support Services)
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Implications for InternetBanking
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Maximize the UserExperience and Usage of Internet BankingMost of the internet banking usersare high net worth, affluent or youngurban customers. Few banks offer anInternet Banking service for all productgroups plus additional, innovativeservices which reach beyond standardbanking products. Some of the leadingpractices in India are:
Ability to allow the customer to seeaccount balances and transactionsfrom other banks within his primarybank log in
Assist the customer to betterunderstand his spending andinvestment patterns e.g. ability to seeall debit / credit card payments splitacross categories like entertainment,household, personal products etc.
Provision of financial planning toolsfor customers
The potential of internet banking is
underutilized with basic transactionalservices and untargeted genericcampaigns. Banks need to focus on:
1. Enhancing the sales capability of internet banking focusing on needbased offering, online advisory for anyqueries, simple handling process andstraight through processing
2. Parallel to offering the functionalcapability for sales services, runningcustomer on-boarding programs todrive high usage frequency
3. Providing customers control topersonalize the site
4. Develop an integrated userexperience taking into account thefollowing 8 categories
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InformationStructure
Security
Page Design Performance PersonalizationProductFulfillment
Sales Advisory
Usability Functionality
User Experience
Able/Not Willing Able/Willing
Group 3 Group 1
Group 4
Not Able/Not Willing Not Able/Willing
A b i l i t y
t o U s e
Low High
L o w
H i g h
Group 2
Strategy
Group 1Focus on reducing the margin of error through ongoingimprovements
Group 2Align solution needs with customer needs
Group 3Modify the behavior
Group 4Ensure capability alignment to solve for cant, provide incentivesfor wont
Willingness to Use
33
Figure 15. Changing the mindset of customers, and aligning self-service capabilities withthe customers most likely to use them
Figure 16. improve customer experience 8 categories need be to considered while designing
the internet banking experience
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Implications for MobileBanking
Optimise Mobile Banking The Channel of TheFutureMobile Banking will be the gamechanger as it enables rich, interactiveexperience to mass affluentcustomers and provides low costsecure banking channel to a largepart of countrys poorly banked andunbanked population. 80% of theworld population has access to mobilephones.
Mobile banking has picked up inIndia after the RBI issued operatingguidelines for mobile bankingin India in September 2008. RBIrecently revised guidelines for mobilebanking allow a larger ticket size fortransactions.
M-Banking services help banks topush the relation with the existingclients, to acquire new clients and to
increase overall profitability.
The rural segment is a gold mine of
opportunity regulatory approval of business correspondents (BCs) andrelaxed know your customer (KYC)norms coupled with active players inthe BC segment means mobile bankingin the rural segment has potentially abigger customer base.
Banks acknowledge the importanceof the mobile channel but its slowuptake has challenged their effortsand investments in leveraging it as acompetitive advantage. Banks needto create a robust platform to enablea wide range of money managementcapabilities directly through multiplekinds of mobile devices. Youngerconsumers in particular have highexpectations for what they shouldbe able to accomplish through theirmobile devicestheir phones arenow simply enablers for their dailyactivities, from communicating toshopping to banking. Their bankingloyalties will be solidifying soon, so
banks must act quickly to provide
compelling and differentiating
services. Banks need to ensure thattheir mobile money managementoffering is:
Beyond just text alerts as astandalone feature - interactivity andengagement are key mobile features
Deploys full feature real time mobilebank front ends for payment andviewing, under bank brand control
Leverages brand for trust andsecurity on mobile
Includes mobile marketing to mobilemoney service to maintain contact
Provides additional services throughmobile payment ecosystem (ticketing,vouchers, loyalty)
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The following factors should be
addressed in detail to ensuresuccessful launch:
Value proposition
- Which customers should I target?Already using mobile banking toprovide a wider range, not currentusers but mobile savvy etc.
- What services should I offer? Onlinefeatures, additional features basedon GPS functionalities on phone (e.g.
assist in ATM location, merchantcategories etc), use of the cameraphoto capability etc.
Customer education & on-boardingcampaigns measured and trackedcontinuously
Constant innovation and serviceevolution based on customer uptakeand feedback
Rapid transition from launch tosteady-state low cost operations
Collaboration and partnership toshare costs
Next GenerationMobile Banking
Useful Targeted services, information andtransactions that a consumer will
desire while on the move.
Convenient Allow the consumer to decidewhich phone they want to use not the bank. Do not rely on operating system,phone or operator specific features.
Secure High perception of security. Thephone should be like a wallet when it is in the customers pocket
it is secure. Once lost or stolen, it iseasy to make the contentsworthless or unusable.
Simple Simple, discoverable, richgraphical interface. No Manualrequired to use new features.
Customer Advocacyand Differentiation
Put your brand into your customers pocket Market position as leading Innovator Offer convenience and simplicity
Greater quality and depth of relationship
SmartClient technologymakes mBanking fastand cheap for the user
EnhanceCompetitiveness
Improve convenience, ease of Interaction and security Serve your customer whenever, wherever andhowever they want Fewer errors and complaints Extending contact points with the customer,improving retention
Latest Smartphone and3G technology allowsmobile bankingfeatures to equal thatof online banking
Efficient marketingand Expansion/protection of Revenues
Improve cross-selling ratio Place advertising in a place that consumers will viewfrequently Ability to blend channels to protect revenues
Reach towards mobilityis growing significantlyin all areas of daily life
Reduced Costto Serve
Encourage self-service for low-value transactions Service volumes taken from higher cost channels Leveraging existing online infrastructure where bankshave made significant investments
Contactless paymentinfrastructure, Bluetoothand WiFi expanding thenetwork for Contactlesspayments
Value Proposition Customer Focus
Figure 17. Banks can use the mobile channel to achieve significant differentiation costreduction and revenue expansion
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Summary
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Designing and executing the
appropriate customer experienceresults in better financial performance,reinforcement of the brand andsustained or improved customerloyalty. Multi channel consistentexperience will drive better customerloyalty and results. Banks need toclarify their channel strategy
1. Most banks do not have a clearidea of how their channel mix shouldwork and which roles their differentchannels are supposed to play
Which roles are the channelssupposed to play?
Which level of integration istargeted?
Which mechanisms should be usedto route customer to the appropriatechannel?
How to overcome "people barriersin integrating channels?
Channel mix is forecasted to changein the future
2. Channels will play more clear and
specified roles in the future whichleverages their specific strengths andallows the channel mix to be moreeffective
3. Banks need to implementMultichannel integration on a processlevel
4. Integrating channels on a technicallevel is not sufficient
5. To reach client needs and realize
cost-savings processes needs to beintegrated between different channels
Growth means attracting newcustomers and engendering loyalty tomake existing ones buy more, and inbanking the challenge is to attract,retain and grow enough customers tomeet investors demands for a returnon their investments. In such anenvironment, the new battleground isthe branded customer experiencethesum total of customer interactionsthat can determine whether and howmuch they patronize a particularcompany. A great customer experience
can dramatically improve customer
loyalty, and also can serve as apowerful draw for new customers.The majority of financial servicesorganizationswhether in banking,wealth management or insuranceareplaying catch-up in determining howto integrate the channel, productand customer-segment silos thatare preventing them from becomingcustomer experience leaders.
Branch
Internet
Mobile
Call Center
ATM
Research Sales(simple
products)
Advice Sales(complexproducts)
Repurchase
Post sales(transactions)
= High effective = Less effective
Source: Accenture analysis
Figure 18. Effectiveness of bank channels in the value chain of sales
Companies dont justsell a product they sellCustomer Experience!Starbucks does not sellcoffee. Harley-Davidsondoes not sell motorcycles.And Guinness does notsell beer. Think about it.
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Retention and cost management
Containing and managing customer costs
What are the incentives to reduce front-office costs impacting your front officeactivities? How would these reductions affect the customer experience?
Who is responsible for the acquisition and retention budget at yourorganization? How are investments in both areas coordinated?
What statistics do you have linking customer performance to financialperformance? How do you use these metrics to manage your business?
What information would help you better analyze and manage customer costsand return on investment?
What constrains you from obtaining or using this information?
Retaining current customers Who are your most profitable customers, and how are you managing theserelationships?
What new needs do these customers have? How are they likely to change theirbuying behavior?
Do you know what drives loyalty within these segments?
What will the impact be if these customers decline in value or leave?
Are you willing to invest in these relationships today at lower profit, to keep
them in the long run?
Acquisition and growth
Expanding business with current customers
What evidence do you see of changes in customer attitudes and behaviors?
How are your customers requirements for service and support changing?
How quickly can you change products, services, and pricing to meet their needs?
How do your customers participate in the innovation process?
What do you know about how customers perceive the value of your offering?
Expanding into new markets and customer segments
Have you taken a fresh look at your growth strategy? How will it change goingforward?
Have you analyzed markets and segments for new growth potential?
How do these opportunities relate to any loss of revenue or profit you mayexperience due to economic conditions?
Do you analyze customers who leave and use this analysis when targeting new
customers?
What are the key challenges to spurring growth in your more mature markets?
Organizations respond to new risksand opportunities with differentmethods and at different speedsfromtactical projects within business unitsto cross-enterprise transformation.Making good decisions about where tohead, how to get there and how fastto move rests on knowing where youstand today, based on your historicalperformance, unique circumstancesand global position. Companies mustquickly and clearly judge their positionfrom these perspectives and then actaccordingly. How customer centric isyour organization?
Where does your organization stand?
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Accenture Assets & Offerings1. Accenture Customer
Experience TransformationMethodology
2. Accenture Next GenerationBranch
3. Accenture Mobility OperatedServices (AMOS)
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Customersatisfaction
Brandengagement
Employeesatisfaction
Customerloyalty
Customerrelevance
Employeeengagement
Customeradvocacy
Employeeadvocacy
Figure 20. The big picture:
Accentures end-to-end view of retention and acquisition strategies and tactics
C o m p e l
l i n g v a
l u e p r o p o s i
t i o n
B r a n
d e d c u s t om
e r e x p e r i e n
c e
Insightthe right analytics
Measurementthe right metrics
Strategythe right levers
Executionthe right delivery
Enablersthe right
operating model
Source: Accenture
By sharpening actionable research, segmentation and analytics, banks candeliver a consistent customer experience that meets new and evolving needsand expectations and reduces churn
Figure 19. Central decision-making and execution agility
Source: Accenture
M a r k e t
& c u s t o m e r
i n t e l l i g e n c e
S t r a
t e g y
Brand
Proposition
Marketing
Customerservice
C e n
t r a
l i z e
d c u s t o m e r o w n e r s h
i p
Rulesmanagement
Customerexperienceoptimizer
Decisionmanagementapplication
Analyticmodeling
Customerdata
Productionapplication
Call center
Web
PoS
eMail
SMS
DM
Adapt product, proposition, pricing andservice strategies to meet changing needsof target customer segments
Prioritize marketing investments/treatments on the most profitable customers(and consider future potential)
Create reasons for customers to stay andspend by focusing on exceeding theirexpectations at those touchpoints that reallymatter to a customer and meeting theirexpectations at the rest
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Accenture Mobility Operated Services (AMOS)
Accenture can also enable newrevenue services delivered throughmobile channels via its business unitAccenture Mobility Operated Services(AMOS)
Reduce time to market Simplified infrastructure Standardized interfaces Support for service levelagreement-based developments SOA for service orchestration Component-based model
SDP Winner of the 2006 CTIAEmerging Technology Award forBest Enterprise ROI 15+ million subscribers 20+ service delivery projects inNorth America, Europe and Asia Accenture is among theworlds largest implementers
Simple, cost-efficient, third-partyintegration Standardized design: SOA design,
modular, interface standardization forMNOs and business partners via APIs Complete solution: Streamlinedelivery process, standard servicecomponents, unify subscriber database Open Solution: Open developmentenvironment and free SDK, dockingstation availability
MobileLoyalty &Rewarding
Telematics
MobileEnterprise
Apps.
MobileMarketingServices
MobileData
Collection
Mobile Voucher
Infomobility
MobileMoney
Management
Mobility Platform(Service Delivery
Platform with
Open SDP)
Vertical ApplicationsMobility Platform
Managed Service
Figure 21. Accenture can also enable new revenue services delivered through mobile
channels via its business unit Accenture Mobility Operated Services (AMOS) which offersthe mobility platform and vertical applications on top of the proven enabling platform
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Accenture Customer Experience TransformationMethodology
To design and deliver a compellingcustomer experience, banks must havea 360 degree view of the market.
WhoIdentifiessegments/Customers forexperience design anddelivery
ExecutionRequirements Treatments
Segmentation/Customer
Voice of the customer
CustomerExperience
DesignOutside-In
Marketplacelandscape
Operationaldelivery
Understanding currentposition:How are othersoperating? Whatoperational trends willchange the competitivelandscape?
Understanding current position:What are customer needs,preferences and expectations?What is driving satisfaction?
Driving future strategy:What oppo rtunities existto better d ifferentiateourselves in themarketplace through thebranded customer
experience we deliver?
Driving future strategy:How should thecustomer experience bedefined to deliver bettercustomer satisfactionwhile beingoperationally ef fective?
Driving future strategy:What customerexperience improvementscan be made to gain anoperational competitiveadvantage in themarketplace?
Understanding currentposition:How effective andefficient are ouroperations andinteractions?
Research Advice Sales Post Sales Re purchase
Define Customer Experiences
WhatDefines experiences acrossall touchpoints throughoutcustomer lifecycle
HowEstablishes businessrequirements and rules toexecute defined customerexperience
Customer Experience Blueprint
Figure 22. Pragmatic customer experiences that satisfy customers require an understanding
of customer expectations, the competitive landscape and operational constraints.Accentures Approach to Customer Experience
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Accenture Next Generation Branch
Accentures Next Generation Branch(NGB) is a series of prototypes andsolutions created by AccenturesTechnology Labs to explore howinnovative technologies and branchdesign can improve the bankingcustomer experience and sales andservice efficiency. A few snapshots:
Welcome areaSelf service area
Advice areaWaiting area
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