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The New Age Customer Service

November 2013

The New Age Customer Service

“Unhappy Customers? 96% of them don’t even complain…that’s because 91% will just leave and never come back…” Executive Summary As the global banking sector emerges out from the glitches caused by the recent financial crisis, it faces the challenge of redeveloping the customer experience while also maintaining the minimal costs. The financial crisis also led to the decline in customers’ trust and confidence, which needs to be reinforced by the banks in-order to reconnect with their lost customers, while the continuing environment of slow economic growth makes cost control an imperative. Fortunately, the technological revolution of the current generation via superior computer and mobile technologies provides a leading edge in meeting both challenges, which frames the idea of writing this whitepaper titled: “The New Age Customer Service.”

Overview Traditionally, customer service is defined as the complete process of identifying customer needs in all their complexity, satisfying them fully, and keeping them satisfied. But, with evolving customer expectations, customers are now becoming more vocal and willing to share both when something is good or bad. Today, innovative customer service does not only mean, being able to contact a bank by phone but also on multiple platforms — using email, web, social media, and mobile devices. Moreover, customer service has now become one of the most important components of the marketing mix for banking products and services. Superior customer service helps to create customer loyalty. They can help banks to grow by increasing the number of customers attracted by favorable word-of-mouth advertising and increasing the frequency and number of times the customers’ perform transactions. Customer service is sometimes the only way a bank can differentiate itself from its competitors. Customers today are not only interested in the product they are being offered but all the additional elements of service that they receive, from the greeting they receive when they enter a bank branch, to the refund and help that they receive when they have a complaint about a faulty transaction that they have paid for. Good customer service will take one step further and help search for answers, chat live with a rep, or schedule an appointment. Imagine a service rep talking you through filling up a form, or a virtual agent who advises you to take the right account or an investment option that gives you great returns. With this kind of customer service evolution happening over the next few years, big changes will be in store for support departments across the banking globe. But how can businesses best prepare?

Customer Service Imperatives – The New Normal Evolution of Customer Service Since customer service is treated as a strategy and philosophy as much as it is a major function for any bank, it’s necessary to constantly update and improve one’s approach. Over the years it has been seen

that the customer service delivery channels are increasing and evolving at a dizzying pace. The pace of the change, basically driven by customers, is accelerating because the social web (commerce and network) has enabled and empowered customers. This means not only staying up to date with new channels and technology, but also monitoring larger trends and folding them into your customer service strategy as and when required. According to a recent survey conducted by Ovum on over more than 8,000 customers highlights that 74% of customers are using at least three channels when interacting with an enterprise brand or organization for customer-related issues—and this individualized stepping-stone journey to resolution is forever changing service and support. The Ovum survey gives a brief snapshot of the evolution of customer service in the figure below with multiple additions of major customer service channels at multiple stages over the past two decades.

The Future Road Map Proactive support Customer service shouldn’t be about putting out individual fires; it’s about building meaningful relationships with customers. Providing proactive support or preventing customer issues before they actually become pain points, not only shows commitments to its customers but also reduces the load on the bank’s support team. Proactive support can take many forms – from working with customers to improve products and services using analytics to measure how bank customers are engaging themselves, and even listening to them via social media. The best way to provide proactive support is to get involved in customer engagement, services, and training to provide best practices rather than just pointing customers about individual banking product features.

Self-service According to Zendesk, around 91% of people will use a knowledge base for self-service, if firms have a knowledge base. Not only that, it needs to be tailored to the form’s customers’ needs. Today banking customers are becoming more and more comfortable using technology — especially with the mobile technology (mobile banking) — to find what they need, rather than calling or emailing with a question. This increasing appreciation for self-service should be recognized and embraced by banks. Such initiatives, not only decreases the volume of tickets the representatives must respond to (leaving them with more time to focus on the more difficult or higher priority tickets), but also provides an opportunity for the banks to build stronger relationships with the customers. Knowledge bases and forums helps to increase the interaction levels with one another keeping the firm as the focal point. Moreover, the bank gets to learn about the customers as they can bring multiple insights to improve service levels.

Product development Customers are the best source of feedback to enhance bank’s product or service. Increasingly, customer support and product development teams are becoming organizationally aligned so that the company can better leverage the wealth of data that the support team gathers. “Voice of the Customer” programs are now common in customer-centric companies. These initiatives synthesize the rich product data provided via customer ticket text, search queries, idea forums, and quantitative measures such as NPS and transactional CSAT. This data both complements and supplements feedback gathered through less structured methods, such as focus groups and surveys.

Multichannel Approach The idea of providing multi-channel support has been around for a while. While phone support continues to be the most popular method among customers, more and more are turning to Twitter, Facebook and email. Thus it is becoming increasingly important for banks to take a specific approach to communicate with customers for each different channel, rather than taking up an approach of one size fits all. For instance, a bank can receive identical messages from a customer; one via email, the other via Twitter. Since tweets are public, it is necessary to not only invite that customer into a private conversation—such as a ticket—but to also respond publicly on Twitter. Otherwise, a casual observer might think the customer is ignored, even if offered extra help. Every channel has different advantages and limitations, and it’s important to understand and embrace them as part of the overall customer service strategy.

…7 out of 10 people think online customer service will dominate over traditional call centres within a decade…. Self Service Channels in Customer Service During the past five years, self care has evolved into self service. Increasing costs and declining margins have led to shift contact time from customer service representatives (CSRs) to less-expensive machineassisted channels as much as possible. This was initially only to answer questions about customers' accounts and to provide information about available banking products and services. However, consumer

familiarity with online interactions, more-intuitive computer user interfaces, and the rapidly decreasing software integration tax have transformed self-care into a much more powerful set of self service capabilities.

Self service functions and delivery vehicles

Source: Analysys Mason

Providing an effective self-service interface has many benefits, including up to an 18% increase in customer revenue through selling features and accessories ancillary to the consumer's current services and products, increased customer loyalty, and the establishment of a 'branding point' in a mobile smartphone or tablet app. Today's busy customers are becoming increasingly willing to find service solutions themselves before contacting the bank for help. This trend not only helps customers get what they want faster, but it's also a plus for banks, helping them decrease their service costs. In January 2013, a Forrester study found that the self-service closely follows the voice as the primarily used communication channel. The study states that, there has been a 12% rise in the use of web selfservice, a 24% increase in chat, and a 25% increase in community usage for customer service over the past three years. Similarly, Amdocs found that 83% of customers would be more likely to recommend a company which offered "easy-to-use and consistent" self-service over mobile phones, while Nuance states that 67% of people prefer self-service over speaking to a company representative.

Source: Forrester

With this in mind, forward-thinking organizations have been looking for ways to bolster their self-service offerings, allowing customers to get what they want faster “Moving forward, automation is going and improve the overall experience. For instance, banks to be about cutting to the chase, have long been catering to customers' affinity for selfskipping past laborious processes, to get service through automated teller machines, cutting queues us to the experience or the product inside their branches and allowing customers to withdraw more quickly.” or deposit money at any time of the day. Advances in technology are making it easier for organizations to deliver – Richard Cope, self-serve solutions to their customers. Director of insight and trends, Mintel Customers are engaging with banks in multiple ways, business leaders need to integrate self-service solutions in different areas, allowing customers to selfserve online, over their mobile phones, in physical branches, and when they contact a bank by phone.

Self-service in branches The banking industry’s banking channel has evolved from traditional full-service branch banking to alternate channels including online, mobile and self-service. Over the past years, the penetration of selfservice branches has increased as banks are more reliant on offering quality service and enhanced customer experiences through facilities in these branches such as automated self-service kiosks, flagship branches, contactless ATMs and in-store self-service branches. Today's tech-savvy customers are becoming accustomed to the advantages of using self service channels to serve themselves. Today these customers can conduct around 80% of banking transactions through ATMs and other automated banking channels without any bank’s staff assistance.

Mobile merges the branch like and online experience According to Nuance, more than 80% of customer service calls are emanating from a mobile device. This is a strong indicator that customers are using their mobile phones more than ever before and opens up opportunities for banks to leverage smartphones to help customers serve themselves, for example scanning and depositing a check from their mobile phones. Banks are leveraging Smartphone technology to extend and improve the banking experience. The fact that so many customers are starting to their banking transactions on their mobile phones is allowing banks to provide an endless aisle of mobile banking services.

Helping customers serve themselves online Online banking is a perfect fit for the self-service experience, allowing customers to reach the desired outcome without having to speak with anyone. In order to tap into customers' willingness to find information to answer their questions, some organizations are creating a detailed knowledgebase on their online properties. Another trend due to customer demand is expected to continue growing is the use of video to share more detailed information with customers. The benefits of video extend beyond its ability to show customers what they need to do to address their issues, but its availability around the clock means that customers can access the information at anytime they want and at a lower cost, even when a contact center might be closed.

Accurate and intelligent IVR systems facilitate self-service Even customers who call into a contact center don't necessarily have to speak to an agent. Cutting-edge IVR systems are helping banks cut down on agent time and instead allow customers to find the answers they're looking for themselves. State-of-the-art IVR systems have “Self-service is more effective and highly accurate speech recognition technology that allow for more convenient for people than open-ended questions, making interactions more human. human service."

Another trend growing is the use of virtual agents to answer – Robert Weideman, customers' questions. The key to success is ensuring that the Executive vice president and virtual agent is able to have a human-like conversation, recognize General Manager, Nuance natural language, and learn from questions that aren't answered. There's a big shift in customers who want to serve themselves rather than speak to an agent, and virtual agents or intelligent IVR systems will provide an alternative for those who want to self-serve. While self-service is imperative for organizations, business leaders need to make sure that this is seamlessly integrated with full support, avoiding the need for customers to repeat steps when connecting to an agent.

Integrated platforms are the future of customer service Banks can no longer wait to integrate mobile and social media channels into their customer service strategies. Customers increasingly want and expect services through the new technology, and banks that fail to adopt these platforms could see drops in client retention. Electronic payment platforms are creating a quick and effective means for banks to interact with customers through several channels. These systems can be optimized for mobile devices or incorporated into social media campaigns to build a multichannel service for customers. According to Wired Magazine, small companies have been able to make a niche for their products and services by beating larger firms to the multichannel strategy. The ability to link various service platforms ensures a seamless transition as users move from mobile devices to PCs and onto phone calls, which greatly enhances customer service.

Overcoming challenges of Multichannel Customer Service Integrated services are not without challenges. A large number of banks struggle to optimize their new channels at first. However, through planning, data analysis and maintaining a focus on the customer experience, businesses have been able to overcome these initial difficulties. Below are a few top concerns of a multichannel customer service strategy: •

Seamless integration – With different channels to interact with, banks need to integrate their various touch points to deliver a seamless customer experience

Different channels – The telephone, Internet, mobile, and social media are becoming increasingly interlinked throughout customers' purchasing journeys. Hence, it is essential for banks to develop and implement a sound multichannel service strategy that will lead to the integration of all service efforts and initiatives across different channels

Customer preference – Business leaders recognize the necessity of integrating their diverse service channels. The integration challenge is intensified since new channels tend to be added individually as they become popular for customer service

Being efficient while remaining effective – Giving customers a choice of which channel to interact with a bank means that they might not choose the most efficient or cost-saving touch point. Therefore, allowing customers to interact with the bank over their chosen channel is an integral part of the bank’s strategy to increase customer satisfaction and subsequently retain customers

Pillars of a good multichannel strategy Web

Social Media

Web self-service is now the primary channel for customer service, with nine out of ten people using a brand's website as a source of information

More than half of the customers now expect companies to provide customer service via social media

Customer Services Live Chat Mobile Three quarters of the customers want to use smartphones for self service

A quarter of customers would use live chat to contact customer service representatives if they cannot self serve

Leveraging social media Customers are using their social channels to interact with banks more than ever before. Some customers interact with the bank solely on Facebook, leading the bank to enhance its social media strategy to communicate with clients in their preferred channel. The added bonus is that social media is less expensive than the traditional contact center. More and more customers nowadays use social media to connect with banks, share their experience of various products, or to get answers to their queries. A negative review or a complaint posted on a social network can instantly reach millions of users worldwide. This has persuaded banks to widen their online reach through corporate profiles on Facebook, Twitter, LinkedIn, etc. Social media is the all new customer service tool with case queues integrated with social networks for faster resolution of customer complaints.

Ensuring mobile integration Customers are increasingly using their Smartphone’s to interact with banks, making it absolutely essential for them to integrate mobile within their overall service strategy. Especially for banks whose sales employees are on the go, mobile integration is essential. With over 1.6 billion units of mobile devices shipped in 2012, we are in a post-PC world. Mobiles have fast become the preferred medium to stay connected on the go. Mobile apps offer a convenient touch point for customers to get in touch with support agents. It’s as simple as just clicking a button to request a callback or get connected instantly – absolutely no more waiting in the IVR. A mobile app is a must-have for enterprises to service their customers and also offer them self-help options.

Recognizing and addressing problems It takes courage to admit a mistake but business leaders have no choice but to recognize when a strategy is not working as effectively as they would like it and change direction. This not only helps the company to re-focus on areas that matter to them most but also lets the customer know that their opinions matter and the bank is listening to them and is there to help them. This brings about a positive outlook about the bank among its customers and increases the loyalty quotient.

Key Drivers of Customer Service Models On demand knowledge repositories Self-service knowledge bases or online customer resources for product information, FAQs, and how-to’s will be present on all devices which means product features need to be richer, more sophisticated, and organized by context. Eventually devices will already know the customer’s purchase history, their personal preferences, and will be able to both detect and predict problems. As more products are designed with touch screen search capabilities, banks will need to place much greater emphasis on first touch resolution through self-service. A good example of a company that’s applying this strategy today is TurboTax. When filing taxes with TurboTax’s software, the form itself provides contextual help based on what the user is filling out, including answers to frequently-asked questions and an option to live chat. This content changes as one goes through the form, and none of the information is lost along the way. Looking ahead, more devices will have a similar built-in help function.

Analytics platform – New investment frontier Millions of devices are Wi-Fi enabled causing a flood of user data for banks to go through. Banks can use this data to understand issues, how frequently and what best resolutions if they have the means to analyze it. Analytics tools will not only help customer service efforts, but inform improved design of products, upcoming product launches, as well as performance improvements. IBM has rolled out a new analytics solution that “harnesses big data from instrumented assets and identifies irregularities in the manufacturing process, spots product irregularities, and forecasts a range of asset performance risks before a problem ever arises.” This type of predictive analytics solutions will be the norm, and companies will need to incorporate tools that will inform and improve customer service engagement on all of their devices.

Next generation customer support agents The contact center is evolving from a volume support center to a more highly sophisticated center of talented agents. While many support reps today are tasked as “concierges,” reading answers from a script or internal knowledge base, tomorrow’s support reps will face more complicated inquiries from customers because basic questions will be resolved right on the device. If a question is routed to a support rep it is likely to be a complicated one, and they will need to be prepared to do heavy troubleshooting on that product. The reps should also have much more information at their fingertips because the data is pre-collected on the device and should provide reps with metrics reports with real-time information about the device, the issue and the user. While now, half of the time of a service call is collecting basic information about the user and the product, in the near future all of this information will be available to the support rep.

And with self-service moving front and center, customers will expect real-time response to all of their inquiries if their answer is not readily available.

Adoption of technology to improve customer service More and more banks are using technology to handle customer service in an efficient and cost-effective way. There's no denying the fact that customer service is important to all businesses. The quality of that service will either enhance or degrade customer loyalty to a brand or business. The business that proves to be responsive to customer questions, complaints, or other needs can gain a clear competitive advantage. That's why it's so important to understand how new technologies can help in anticipating customer needs, tailor business processes to best serve customers, and ultimately improve the efficiency of any business which can keep costs down.

Customer Service Technology There are a few major areas in which technology is able to provide key advantages to businesses in engendering customer loyalty by improving customer service: • Websites - Providing an area on a website where customers can answer their own questions or seek answers from others • E-mail - Using e-mail as a way to improve customer service and more quickly respond to certain needs or help requests • Communications - Unifying communications so that one is aware that the customer who left a voice mail also sent an e-mail with the same request a few days ago • Software - Better managing customer relationships with more sophisticated data-gathering tools, such as customer relationship management software

Giving Customers What They Want, When They Want It The goal of any bank in terms of its customer interactions is to generate loyalty. There's no better way to do that than to offer quality products and services and to be responsive to customers. But as new technologies have come to market to make it easier for banks to provide customer service, they may also be increasing the number of channels through which one can interact with customers and the complexity of those interactions. Banks that want to use technology to raise the quality of their customer service focus on the following: • Data management and analytics - Using data collected from customer to analyze their preferences •

Insight-driven marketing - Gaining insights into business from customer data so one can more effectively target marketing

Marketing automation - Streamlining and automating business processes to improve efficiency and keep costs low

Self-service optimization - Finding ways for customers to interact with business when they want

Workforce effectiveness - Encouraging staff to embrace new ways of improving customer treatment by providing tools and training to deliver better service

Conclusion With changing technology, the face of customer service is changing, which is impacting the traditional ways of interacting with customers, win their trust, and keep them coming back are becoming irrelevant. The fact is that the trends in technology will show no signs of slowing in the near future because customer service is no longer about processing a transaction. Moreover, a customer’s relationship with a brand is no more only about buying a product. Customer service has moved ahead

and is all about being a trusted advisor to ensure people are buying the right items and they know how to use them. Customers want an awesome experience with great support to complement their purchase. As the literal meaning suggest, today customer service means ensuring that every customer is genuinely satisfied with their choice. While online self-service is here to stay, phone is still the most popular mode of communication, customers are increasingly using self-service channels to help themselves. As per the findings by Forrester, usage of online self-service has gone up by 12% in the last three years. Do-it-yourself videos are now widely used by customers to find answers to their queries and diagnose or troubleshoot problems. Self-service benefits both enterprises and their customers. On the one hand, it enhances CSAT; on the other hand, cost to serve reduces. Moreover, the changing trend also envisions a bright social future for customer service. The rise of the social customer trend has empowered a broader transition to the social enterprise, which is seeking to emulate the speed and simplicity of the social web. Going forward, one can expect to see a new kind of real-time and ‘frictionless sharing’ begins to reshape the modern enterprise, in turn transforming the relationship between multiple stake holders. However, when it comes to multi-channel support, enterprises pose quite a few challenges. The most important one is the seamless integration of different channels and at the same time ensure a personalized, consistent experience. The global explosion of multiple devices and platforms has driven the need for enterprises to service customers at their point of need. Irrespective of the medium – whether it’s through a phone call, online chat, social media, email, web form, etc., customers want to be heard and get response without any delay.

The new age customer services