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Digital disruption on its way to the ANZ banking sector

27 Jul 16

The banking industry in Australia and New Zealand must prepare for digital disruption.

That’s the word from Bill McMurray, managing director, Asia Pacific and Japan, at Qualtrics, who says ANZ banks need to embrace the digital revolution to ensure they stay relevant for millennials.

If not, McMurray says they face the possibility of losing this section of customers as digital disruption shakes up the banking industry,

In order to remain relevant, the ANZ banking industry must interact with customers in new ways, which starts with understanding them more clearly, according to McMurray.

“Banks must continue to innovate to succeed on the digital frontier. Banks need to find ways to connect and engage with their consumers, and customer feedback is one of the most important ways to achieve this,” he says.

A recent study revealed that 70% of millennials in the United States said the way they pay for things will be totally different in five years. A third said they didn’t think there would be banks at all, while nearly half said they are counting on tech start-ups to overhaul the way banks work.

Locally, research shows that Australia's ATM fleet has now declined for two quarters in a row and the number of withdrawals per year is now running at its lowest level in more than five years.

Furthermore, smartphones are expected to dominate banking technology. Already just under 40% of consumers aren’t visiting physical bank branches anymore.  

“Australian businesses lose $8 billion a year in revenue due to poor customer experience,” McMurray says. “So it’s essential for banks to have an effective voice of customer (VoC) strategy in place.

“Asking customers for feedback helps you improve customers’ experience and develop new services to keep customers and ultimately, increase revenue,” he explains.

Qualtrics provides three key guidelines for financial institutions to gain feedback across digital customer touch points:

1. The mobile experience: Institutions should use a targeted post-experience survey that asks the user to indicate their level of satisfaction. Simple page-level feedback questions or static feedback links let visitors provide feedback when and if relevant, without disrupting the user experience.

2. Engage directly with the customer at the right time: It’s important to understand how customers are using the website, then use that information to make the experience feel more personalised. Timing is key: if you can intercept a visitor who has been idle on a page for 30 seconds and ask them if they need help, you could capture relevant insights about how your website works for different people, as well as helping an individual customer.

3. Focus on changing behaviour and improving the digital experience: Companies that use digital feedback to improve visitors’ experiences are more likely to have more deeply-engaged customers, which manifests as improved business metrics. It’s not enough to simply collect the data and feedback. You need to analyse it and use the insights to adjust your customers experience and most importantly act on negative customer feedback.

 “To compete with disruptors, financial institutions need to do a little disrupting of their own,” says McMurray.

“The only way to do this is to find out exactly what customers want, deliver that, and more, in an appropriate timeframe,” he explains.

“Companies should be able to see customer feedback in real-time, and through role-based dashboards so managers are enabled with the right customer information to make an impactful change.

“Hearing and acting on voice of the customer insights is the starting place and it’s essential to get that process right to build a strong foundation for future success.”

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