Optimize the transaction life-cycle and win
What do you call a teenaged customer at a bank branch?
A hallucination.
That just about sums it up. Banking behaviour has undergone such a generational shift that all customers cannot be treated alike. Conventional segmentation by bank balance is no longer enough. It simply does not highlight differentiated individual needs. And the time’s come to think out of the box.
All banking transactions go through a four or five stage life-cycle - information dissemination, prospecting, on-boarding, transacting, and support. Each is associated with a customer, need, channel and product or service to create a unique “experience”. Clearly, there’s a world of difference between a 65 year old walking into a branch to seek information about retirement plans and a twenty-something opening a demand deposit account online. So, how can they be treated the same just because their bank accounts hold the same amount of money?
Can banks do things differently? With a bit of innovative thinking, they most certainly can. One way is to map every stage of the transaction life-cycle on a multi-dimensional grid comprising customer segment, product and channel and optimise each within its specific context. For instance, since Generation Y would prefer to bank unassisted, all of their activity could be directed to online or mobile banking by designating these as their “primary channels”. Likewise, the call centre and branch could be optimized to serve Gen X and senior customers.
This could potentially create a win-win for all concerned: Banks make better use of their infrastructure and unclog channels by re-routing secondary traffic. To top it all, they can enhance revenue by aligning their pricing structure with the optimized mix, so that every optimal “incident” is offered at the optimal (read cheapest) cost and vice-versa. Thus, a senior customer may be asked to pay extra for mobile banking which is obviously not his primary channel, whereas a teenager could be charged a fee for expecting in-branch service. Putting a different spin on it, this could be described as a price customers must pay to keep their primary channels from becoming overloaded.
Customers benefit from a smoother banking experience since optimized information dissemination improves education processes, optimized prospecting improves empowerment, and optimization of on-boarding and service help banks to embrace and extend customers respectively.
Now that’s a sure way of giving each customer the personalized attention he or she needs!
