BBVA Innovation Edge’s seventh issue will provide you very interesting and useful information about the last trends regarding omnichannel strategies and customer experience. 'BBVA InnovationEdge' is the first corporate multiplatform magazine focused on innovation. Each edition features articles, analysis and huge information about a particular theme. The main purpose of the magazine is to express the new trends and the upcoming technologies that may impact to the financial industry.
Text of BBVA Innovation Edge. Customer Experience (English)
NOVEMBER 2013 Customer Experience Designing customer experiences for value also in this issue Trending issues Technology trends Customers at the Front & Center of Business Customer Experience & Banking Hello Omnichannel! Omnichannels for FSs 7
Corporate social responsibility at the sales coalface no more only 'what's in it for me'
Customer experience management (CX) will replace CRMs
Customers control the buying process
Salespeople become financial managers
The rise of smartphones in sales
Marketing (as we know it) is dead
Breaking the chain of ignorance, upping the pace of transformation
Empathy, the new sales edge
The university of selling
Instant access to solutions
Sales leadership in uncertain times; stop managing and start leading
Delivering real value beyond product and price
Customers at the Front & Center of Business Changes in technology are forcing change onto business models. We are moving away from product-centric models and moving towards customercentric models. Leading companies are discovering ways to harness this shift by placing customers at the front and center of business.
Ready for customer-centricity Customers are living increasingly digital lives, with access to technology and information that enable them to make better and more-efficient decisions across their day-to-day interactions with companies and other individuals. Understanding the underpinnings of this digital life, the ecosystem that is driving customer adoption and how this integrates into existing face-to-face interactions will be key to banks and financial services companies flourishing through the next five years. Nexus of Forces: the convergence of major technology trends; setting the table for the post-product era: Welcome to customer-centricity. Source: Gartner | The Nexus of Forces: Social, Mobile, Cloud, and Information, June 2012 Gartner | Agenda Overview for Banking and Investment Services, January 2013 image: i95dev | Applying Gartners Nexus of Forces to Retail, March 2013 Behaviour Information Social Delivery Access Cloud Context Mobile
Customers are now in control Customers now hold the power in their relationships with banks. They are more connected, vocal, and on the lookout for stronger relationships than ever before. They want a partner in their daily lives, not just a product or service Source: EFMA/Peppers&Rogers Group Customer Experience in Retail Banking, 2010
People are the new channel In a digital and social age, pipes are less important. People are the channel. You dont own or rent them. You cant control them. You can only serve and support them. This new world is disorienting because pipes and people work very differently as channels. Pipes flow out; people flow in. Content is pushed out through pipes, but pulled in through people. This reversal is shifting the balance of power. You can only serve and support them! Flow in! You cant control them! Flow out! Content is pulled in through Content is pushed out through! Source: Harvard Business Review | People Are the New Channel, April 2013
CX (Customer Experience) is increasingly a top of mind issue Competitive differentiators of the pastmanufacturing strength, distribution power, and information masteryhave each been commoditized and are now easily accessible to every company (and, lets face it, any enterprising individual with a smartphone). This has led to mass digital disruption and dissolution of traditional industry boundaries. The field of customer experience has risen to prominence over the past several years because weve entered a new era: the age of the customer. As we approach the end of 2012, the business discipline of customer experience, or CX, has gone mainstream. Its acknowledged as a key competitive differentiator, even by those who prefer spreadsheets to sticky notes. Source: Forrester | Outside In: The Power of Putting Customers at the Center of Your Business, 2013
Other industries are focusing on customer experience Over the past seven years, Forrester has observed an increase in the number of companies that have a single executive leading customer experiences efforts for a business unit or entire company. Whether firms call them a chief customer officer (CCO) or give them some other label, Forrester sees an increasing number of executives accountable for customer experience efforts across a business unit or an enterprise. 17 % 16 % Software 15 % 24 % Professional services Financial services 9% 10 % Utilities 5% Healthcare 6% Telecommunications services 4% Business services 5% Retail 4% 5% Automotive 1% 3% Consumer products manufacturing 3% Food manufacturer 3% 5% 2% 3% Transportation services 2% 1% 2% 2% Art. entertainment and recreation Beverage manufacturer Industrial manufacturing 2% 1% Commercial printing 1% Education 1% 1% 1% 1% Media Restaurant, bars, and food services 1% 2% Wholesale 1% 2% 2013 2012 8% 7% 8% 15 %
The rise of the Chief Customer Officer CCOs will play an increasingly critical role for firmsnot just in helping them differentiate based on great experiences, but also in adopting new business architectures and operating models made possible by new capabilities like digitally connected products and services, mobile computing,social networks, and dynamic partner networks. Source: Forrester Research | The Rise of the Chief Customer Officer, January 2011 Successful CCOs will move their company from a reactive find-and-fix mentality to one that aligns employees, partners, processes, and technologies around customer goals and uses emerging capabilities to deliver new value.
Customer Experience & Banking In a crowded banking market, just having good branch locations with high-level service and competitive rates are not going to cut it. Banks must find ways to remain relevant in the future Financial Services industry by embracing CX as a key element of a sustainable, competitive business model.
If I need banking services nearby, how many providers are there? Theres a lot!!! For example, in the US, there are more than 15,000 Financial Institutions; about 7,800 banks and 7600 credit unions. In a typical metropolitan setting, a depositor will have more than 50 banking providers competing to capture the deposit. Needless to say, just keeping the money safe isnt going to be enough to win the business. At the end of the day, whoever consistently offers the best experience for the customer will win. Just 5% deposits are held by banks competing in regions with less than 15 Fls. 89 Competition is intense, with 28 Banks competing in a typical geographic area N MSA ( Metropolitan Statistical Area ) % Deposits 28 Banks competing in a typical MSA 66% of all deposits are held by banks competing in regions with more than 15 Fls. 41% 82 82 18% 40 38 Source: Optirate | Retail 6% Banking is more competitive than most believe, 2011 9% 13% 7% 24 6 13 1% 4% Financial Institutions < 10 11-15 16-20 21-30 31-50 51-75 76-100 > 101
And if we add direct banks into the mix ... Not only do consumers have lots of nearby banks offering financial services, they also have access to direct banks (aka branchless) ... and they are capturing the customers attention and their business. Source: TNS | Direct Banks and the Future of Retail Banking, 2012 Share of New and Lost Primary Bank Relationships BOFA, CHASE, WELLS 24 REGIONAL BANKS Share of New Relationships 37% Share of New Relationships 35% 30% 29% 30% 28% 34% 28% Share of Lost Relationships COMM. BKS & CUS 41% Share of Lost Relationships 4 DIRECT BANKS Share of Lost Relationships Share of New Relationships 32% 8.0% 31% Net share loss 28% 3.5% Share of New Relationships 07% 2000 2006 2008 2005 2007 2009 2010 2011 Net share gain Share of Lost Relationships 2012 2000 2006 2008 Proj 2005 2007 2009 2010 2011 1.0% 2012 Proj
Customer Experience & ROI Despite an increased focus on customer experience initiatives by banks of all sizes, new research has found that not all of these efforts may be resulting in revenue growth ... Part of the problem is a lack of association by banks between customer experience initiatives and a tangible ROI. The important question is which activities lead to revenue growth. Establishing a goal for customer experience impr