Youbiquity Finance; Consumers, Contact Centres and Finance

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This white paper Youbiquity Finance report is the second of three based on a survey of 2,000 consumers. It focuses on customer contact centres and highlights changes in consumer behaviour. Includes tables and infographics and ends with Youbiquity recommendations for providers. BT did research with 2000 customers across four countries in 2011. This white paper explores the results, and coins the term “Youbiquity”, which gives identity to Financial services being ubiquitous and the importance of our services being personal to our customers.

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Youbiquity Finance; Consumers, Contact Centres and Finance

  1. 1. YOUBIQUITY FINANCE 2Consumers, contact centres and financeMeeting the demands of consumers in the futureMarch 2012
  2. 2. Contents Summary1 Page 3 Introduction and methodology2 Page 4 The phone remains core in retail financial services3 Page 5 Phone service is not all the same4 Page 6 IVR5 Page 7 Security barriers to good service on the phone and online6 Page 8 The contact centre at the core7 Page 9 Proactive outbound contact will become predictive ‘smart service’8 Page 10 Youbiquity Finance9 Page 112
  3. 3. 1 Consumers, contact centres and financeSummaryYoubiquity Finance is a new trend in retail financial services is a response to the emphasis consumers now place on timethat is playing out in markets around the world, including and speed, their willingness to adopt technology (includingGermany, Spain, the UK and USA. Many industry experts have smartphones), and their increasing engagement with financialpredicted changes in retail financial services, but our survey of services due to the consequences of the economic downturn.2,000 consumers puts many of these ideas to the people thatmatter. It has shown that consumers increasingly value access This Youbiquity Finance report is the second in a series of three.to information, accounts and providers when they are on the It focuses on customer contact centres and is characterised bymove, at work, in their homes, or wherever they may be. This the following changes in consumer behaviour: ■■ onsumers are spending more time and energy C ■■ Poor messaging during call queuing is a major source managing their money (65% agree). On the lookout for of frustration according to 40% of consumers, the UK the best deal (57%), they say they are less loyal to banks having the highest percentage. than in the past (50%). ■■ Despite the opportunity to use single ID, nearly half ■■ Consumers are still very reliant on contact centres, of consumers find security, passwords and IDV a particularly when something goes wrong. 62% agreed, barrier to good customer relationships. 41% agreed ‘I tend to use the internet for simple transactions with with the statement, ‘I like the idea of organisations using my bank, while going to the branch or phoning for the technology to identify me by my voice and save time on complicated issues’. the call’. ■■ Consumers use ATM, branch and internet self-service ■■ Youbiquity Finance captures the trend of consumers more frequently than phoning the branch and call centre, wanting their financial services providers to be available but the phone remains one of the big four channels for through an increasingly wide range of channels and consumers. locations. The average number of channels used to purchase a new product is 2.9, with nearly 1 in 2 ■■ IVR is popular with one in four consumers, reflecting consumers agreeing they continually change how they banks’ success in using the automated phone service contact financial providers. for repeat enquiries like account balances. ■■ Consumers are willing to use voice self-service such as activating a credit card by keypad (preferred by 34% in the USA and 27% in the UK) or using voice recognition (31% in the USA and the UK). 3
  4. 4. 2 Introduction and methodologyIntroduction and methodologyPoliticians, management gurus, financial service leaders and Youbiquity Finance sets out to understand the zeitgeist intechnology leaders have discussed the future of retail financial retail financial service. This latest research covers how theservices extensively since the global economic crisis began in Autonomous Customer relates to banking and insurance across2007. This series of three papers – Youbiquity Finance – aims the vital international markets of Germany, Spain, the UK andto understand the consumer perspective on channels, finance USA. It details what consumers want from financial providers inand the future. Part 1 looks at ‘Consumers, money and the terms of service delivery, now and in the future.branch’, Part 2, ‘Consumers, contact centres and finance’,and Part 3, ‘Consumers, mobile and social media’. Davies Hickman Partners undertook a four-stage research process: BT Global Banking Financial Markets and Avaya n Comprehensive review of published sources on multi- commissioned Davies Hickman Partners in 2012 to channel CRM in financial services. complete a follow-on project from the Autonomous Customer research published in early 2011. The n ix S interviews with senior executives from leading previous research identified current and future financial providers. consumer attitudes and behaviours towards n nline O survey of 2,000 consumers: 400 in Germany, organisations across the UK and USA, including: 400 in Spain, 700 in the UK and 500 in the USA. ■■ 8% of consumers plan purchases online 7 The consumers matched a nationally representative sample in terms of age, income and employment. ■■ 59% prefer online because no one tries to sell them anything n nalysis A of the data inputs to create a presentation and white paper with key findings for retail finance. ■■ 51% trust customer forums more than organisations’ websites ■■ 60% agree they continually change how they BT Global Banking Financial Markets and Avaya are using contact organisations the results of Youbiquity Finance to improve the services and products they offer to the financial services sector. The outputs ■■ 46% say loyalty is a thing of the past. are designed to support collaboration with clients, improve decision-making and contribute to more efficient investments. research analysis Marketing Service Innovation The research, data and views in this paper have been prepared in good faith but neither Avaya, BT Global Services or the authors of the reports can be held responsible for any actions or otherwise taken by those reading the paper. 4
  5. 5. 3 The phone remains core in retail financial servicesThe phone remains core in retail financial ‘Once we resolved the service issue whichservices – for consumers and providers generated the inbound contact, we couldAcross Germany, Spain, the UK and USA, the phone still plays offer customers cheap loans, credit cards anda crucial role in service delivery for consumers, despite the value-added current accounts. It’s much moregrowth of digital channels. For the customer, its power lies in effective than online.’its ability to resolve more complicated service issues, while for Manager, Bank, UKthe provider, it is the emotional connection with customers andability to cross and up-sell which is valued. Nearly 1 in 4 consumers are not online in Germany, Spain, the UK and USA, and not included in the survey. For these 62% agreed consumers, the phone remains a vital channel for sales and ‘A good experience with a call centre agent or service. branch staff impacts positively on my loyalty towards a bank’ In 2005, BT Global Services identified the risk of banks becoming ‘invisible’ to high-value customers who adopt self- service channels while visiting the branch less frequently. OverIn fact, 58% of consumers agreed, ‘If I have a problem, I would the past eight years, many providers have avoided this risk byrather phone an organisation than use a list of frequently asked using the phone to build customer relationships and emotionalquestions (FAQs) on their website’. A further 62% agreed, ‘I engagement, and identify opportunities for sales.tend to use the internet for simple transactions with my bank,while going to the branch or phoning for the complicated issues’. Now, the focus is on enabling agents to become ‘personal bankers’. These contact centre agents need to become more knowledgeableWhen it comes to channel choice, the phone is the fourth and and skilful in advising customers, for two main reasons:fifth most used, accounting for over 100 million calls a year for ■■ consumers themselves are better informed before making aa large national bank in any of the markets surveyed. Each call, or have already tried and failed using an online channelmarket has a differing split between calls answered by thebranch and call centre, as many of the German, Spanish and ■■ regulatory pressure requires better skills and knowledge forUS have smaller local banks. both servicing and selling. Top five channels used to contact bank in the past 12 months   Total Germany Spain UK USA ATM/cash machine 83% 85% 88% 89% 71% Face to face in branch 72% 57% 77% 77% 73% Internet site/internet banking 51% 38% 52% 60% 47% Phone call to your branch 36% 42% 50% 22% 39% Phone call to a call centre 30% 17% 26% 42% 26% 5
  6. 6. 4 Phone service is not all the sameCustomers do not regard all phone service provided by the Always or often have to wait too long…financial services industry to be uniform. In fact, overseas call To get through to someone at a call centrecentres are universally unpopular across all markets. 66% inGermany, 68% in Spain, 78% in the UK and 82% in the USAagreed that, ‘If I have a problem or complicated query, I do notwant to deal with overseas call centres’.Equally, both published research and media coverage highlightthe issues of long call queue wait times, lack of personalised 35% 41% 45% 33%service, and complicated IVR options. One in two UK consumersis likely to complain of delays, followed by two in five from Spain. Germany Spain agreeing % UK US 6
  7. 7. 5 Automated phone IVR: 1 in 4 ‘Automated phone services need intensive usability testing to drive customer take-up. prefer it for speed and low effort It needs to support the brand and most of all it needs ongoing refinement as customers,The cost-saving benefits of IVR are well established, with products and branding change.’some national banks handling two-thirds of inbound calls using Manager, bankautomated services for account balances, payments and simplerequests. Amounting to millions of calls, and huge cost savings, applications. Voice recognition and activation is being used inthe success of this technology is reflected in many consumers cars and televisions (instead of remote controls), and some infavouring IVR for speed, low effort and avoidance of queues. the industry believe Search will evolve from text to speech input.Although IVR and voice self-service has been publicly criticised,it works better for customers when repeat transactions In retail financial services, there are clear reasons why manyare involved. consumers would be happy to use automated phone services, whether push-button or voice activated. Some providers areVoice self-service and voice activated technology is improving gaining large cost-saving benefits from using these technologiesall the time, and features such as Siri on the Apple iPhone compared with others, who are using live agents for simple4S mean consumers are becoming more used to these queries. Experience shows that usability is everything: Reducing demand: IVR and voice self-service popularity   Keypad or push buttons on your phone  Voice recognition   Germany Spain UK USA   Germany Spain UK USA Checking branch opening hours 36% 21% 42% 41%   40% 32% 36% 37% Getting you through to the right person in the bank 34% 27% 38% 39%   39% 42% 42% 38% Customer satisfaction surveys 26% 24% 29% 37%   26% 33% 31% 31% Checking account balance 24% 26% 38% 42%   26% 42% 40% 44% Entering personal details 23% 33% 30% 32%   24% 31% 31% 30% Stock/share prices 13% 15% 14% 16%   16% 16% 15% 18% Activating a credit card 10% 23% 27% 34%   14% 29% 31% 31% Paying credit card bill 10% 22% 26% 27%   11% 21% 29% 29% Setting up a direct debit 9% 18% 14% 16%   14% 28% 26% 17% Renewing car insurance 5% 15% 11% 13%   9% 14% 16% 15% 7
  8. 8. 6 Security barriers to good service on the phone and onlineAccessing the contact centre remains problematic. Despite the Segmenting service delivery usingopportunity to use simple technologies, nearly half of consumers messagingfind security, passwords and IDV a barrier to good customer Many providers are attempting to segment not only the productsrelationships. customers use, but also the customer service they receive. This goes well beyond a ‘Premier’ banking offer, to segment customers based on their product holdings, channel preferences 41% agreed and potential future revenues. Our survey revealed that the call ‘I like the idea of organisations using queue messaging used has yet to provide tailored and relevant technology to identify me by my voice and messages for segments of customers. save time on the call.’ ‘I had already tried to do it on the internet, soOften a response to changing regulatory requirements, the the last thing I wanted to be told on the phonehigh customer effort involved and use of ‘cold hand-offs’ have queue was “Did I know about their online services”!’created a major opportunity for service differentiation andcost-saving. Consumer, UK Security barriers to good service The music and messages you hear while on hold often don’t provide a good impression of the financial services provider I’m calling I am put off using financial service providers if there are too many 18% 35% passwords and ID details needed I have so many passwords I some- times find it difficult to access 15% 31% accounts, websites, etc I am often asked to repeat my account details on the same call 15% 24% 42% 40% 44% 32% which is irritating agree slightly agree strongly Germany Spain agreeing % UK US 8
  9. 9. 7 The contact centre at the coreMerging with digital channels and branch? ‘The range of channels our customers want to 46% of 25–44 year-olds agreed use continues to grow.’ ‘I buy more from financial services providers if Contact Centre Director, Bank their customer service is good.’A huge range of channels are being used by providers globally, Internet self-service in banking has grown to over 50% adoptionincluding webchat, social media, co-browsing, video, and in some markets, and banks are developing second generationeven proprietary messaging services. Consumers’ enthusiasm websites that enable advanced self-service like credit cardfor self-service and new media is strong; however, they still activation and overdraft limit increases, and incorporate socialneed appropriate support and assistance when dealing with media. However, our survey showed that customers are lookingcomplicated and infrequently purchased financial services for a range of live agent-facilitated help on more complicatedproducts like mortgages, insurance and loans. Additionally, issues. Although few providers currently offer these services, aservice issues and complaints – a growing area of communication range of online help channels were favoured and these sit mostin the UK at least – are being increasingly dealt with by the comfortably in the contact centre at the core of human advicecontact centre. Where once the focus was calls, modern contact and support.centres have departments handling web-chat, e-mail, outboundand co-browsing. When you are on a financial services providers website, 32% of 16–24 year-olds if you need help would you like to be able to use… have webchat conversations two to three times a week or more.   Germany Spain UK USA Web-chat 16% 26% 31% 32% The contact centre at the core of the customer relationship Video-chat 11% 15% 9% 14% also means ‘ensuring that all parts of the bank are aware of your recent contact so you never have to explain something Click to call 10% 25% 22% 24% twice’. Only 55% of consumers surveyed score their bank as Co-browse the site with a 16% 18% 10% 12% being good in this respect, so there is clearly a need to integrate rep. of a bank fragmenting channels. 9
  10. 10. 8 Proactive outbound contact will become predictive ‘smart service’Related to the contact centre evolving to the core of the customerrelationship, international consumers are looking for financial ‘We’re certainly investigating the use of moreservices providers to initiate helpful reminders. The concept of proactive reminders and notifications to our customers.’‘smart service’ is starting to emerge, where providers activelymonitor and track customer relationships and then intervene Manager, Credit Cardwhen appropriate – for example, if a customer is overdrawn ora better savings rate is available. This willingness could also translate into sales, with some 44%A range of ‘smart’ outbound services are welcomed by of consumers saying they do not rate their bank highly for ‘beingconsumers in Germany, Spain, the UK and USA, including proactive and letting you know about good deals because youreminders about service issues and events. are a loyal customer’.On what occasions would you welcome instant updates by text, email or call from your bank?  Germany Spain UK USAWhen there has been suspicious activity on my account 60% 62% 68% 66%When my card is being cancelled for security reasons 45% 55% 58% 51%When a better deal is available 33% 49% 39% 28%When the interest rate changes 29% 32% 26% 21%When I go overdrawn 28% 51% 52% 57%When an amount is paid out of my account 28% 61% 30% 31%When an amount is paid into my account 22% 57% 32% 37%When my tie in period is coming to an end 15% 22% 22% 10%When I’m making a payment 14% 47% 15% 25%None of these 24% 11% 17% 15% 10
  11. 11. 9 Youbiquity FinanceThe future of sales and service Cross-channel communication means theOur survey has shown that consumers increasingly value contact centre is core to relationshipsaccess to information, accounts and providers when they are Channel fragmentation is ongoing, and convergence of deviceson the move, at work, in their homes, or wherever they may seems some way off despite the efforts of Apple and Androidbe. This Youbiquity Finance is characterised by the following with smartphones or tablets. Consumers prefer to switchchanges in consumer behaviour: channels depending on:■■ time pressure, meaning speed and simplicity ■■ Channel characteristics – what the device or media are suited to■■ technology adoption, including smartphones, which means consumers are ‘always on’ for data and other consumers ■■ Channel preference – what is available to the customer that they prefer using■■ financial engagement, which involves consumers taking more interest in their money. ■■ Occasion – the purpose of the contact or mood of the customerProviders of Youbiquity Finance now have the opportunity to ■■ Context – the situation of the customer (travelling, at work)build better relationships with consumers and therefore strongerand longer revenue streams. ■■ Supplier – what the provider offers in channel capability (eg out of hours service or availability of a mobile app) The upshot is that channel switching is widespread in financial services, with 37% of consumers agreeing they continually change how they contact financial providers. With customers using 2.9 channels on average to purchase a simple home insurance product, they have high expectations of providers bringing together disparate channels and personal data. 11
  12. 12. 9 Youbiquity FinanceCustomer journey for purchasing home insuranceRead review by journalist/ expertRead online review by another customerUsed price comparison websiteUsed financial service providers websiteContacted a 3rd party brokerPhoned the providerHad a face to face meetingFilled out a paper formApplied by postApplied onlineHad a web-chat conversation 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 12
  13. 13. 9 Youbiquity FinanceThe central challenge of Youbiquity Finance is to make finance differently at national level. The contact centre, whether localservices available everywhere, and integrate them in a way or central, will become the core of these new and traditionalthat provides seamless service to customers. The different channels. Its role as the ‘eyes and ears’ of the organisation willpreferences of German, Spanish, UK and US consumers show remain crucial in understanding customers’ experiences andthat this task can have a global direction but must be executed launching proactive contact to drive up recommendation scores. The Future Contact Centre Automated calls / IDV Inbound calls Social media Complex calls Video – ‘Branch’ calls direct branch Contact Traditional Centre core call centre - Youbiquity Mobile Finance E-mails banking Web self-service Web-chats Outbound calls support Smart outbound 13
  14. 14. 9 Youbiquity FinanceYoubiquity Finance RecommendationsThe research has captured consumers changing attitudes andbehaviours towards channels and communication with financialservice providers across Germany, Spain, the UK and US.Recommendations across the three reports include: ■■ Consumers are managing their money more closely and ■■ obile banking and payments are emerging fast M expect providers to offer a wide range of new channels and although on-going usage may not match trial by (voice self-service, mobile, social and proactive or consumers, ensuring that financial providers ‘own’ the ‘smart’ outbound communications), even if traditional mobile channel will be vital to maintaining customer channels like the branch, phone and internet remain the relationships. core means of communication. ■■ Social media has been taken up slowly by consumers ■■ Providers need to integrate these channels into existing in financial services as they are reticent about sharing offers to reduce customer effort and meet consumers information about their money indiscriminately. However, demands for security, time saving and convenience. This social media is capturing consumers’ attention, and for means the contact centre may become the ‘core’ of the this reason, it should capture providers’ attention too. relationship providing better access to channels, advice ■■ Segmenting products and service delivery offers and resolution of issues. It will be essential to prioritise opportunities to improve the cost base of the provider the ability of agents to answer complex questions and while making more relevant offers to consumers. This build relationships. will demonstrate to consumers that providers care and ■■ Cross and up-selling through digital channels is less will help build trust and relationships. effective than face to face and the phone, so providers ■■ Finally, improving business processes is vital to reduce need to retain these methods to drive sales while the effort and time required of consumers (and staff improving the data analysis and proactively prompting serving them) to manage their finances. consumers during digital communication. ■■ Turning the branch into an advice centre is a clear strategy as transactions decline. However, as retailers know, attracting footfall is critical and providers need to innovate in branch to drive sales. 14
  15. 15. Offices WorldwideThe services described in this publication are subject to availabilityand may be modified from time to time. Services and equipmentare provided subject to British Telecommunications plc’s respectivestandard conditions of contract. Nothing in this publication forms anypart of any contract.© British Telecommunications plc 2010Registered office: 81 Newgate Street, London. EC1A 7AJ Registeredin England No. 1800000.PHME: 58647

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