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Loyalize Your Financial Services Customers
By Improving Service at Crucial Customer Interactions
Ms. Silvana Buljan
Founder, Buljan & Partners Consulting
G-CEM International Partner (Spain)
www.buljanandpartners.com
This article is exclusively written for G-CEM.
Managing customer experience in Financial Services means more than just fulfilling customer expectations at each point of bilateral contact. What does the customer really value once a financial contract is being negotiated? What does the customer expect once the contract has been signed, and the period of "service ownership" starts? These questions were asked by one of our clients who wanted to start the integration of customer needs and expectations into its services offering.
Our client is a premium automotive brand financial services company, offering financing and leasing products to private and business customers. All sales activities are performed by the distribution network (car dealerships), who are the main customer touchpoint during the "attraction" phase. There exists no exclusive contract with the dealerships for financing contracts, they can offer any financial services provider to the customers. All aftersales / customer service activities are performed by our client's internal customer service department.
As economic downturn was expected a couple of years ago, and our client wanted to be prepared for decreasing new business, more strategic importance was given on improving the service excellence standards for potential and existing customers.
The project should focus on identifying the business critical interactions with potential and existing customers in terms of being decisive moments for loyalty. Our client has done several CRM initiatives, implementing new processes and systems, but no real change in customer behavior and business performance could be demonstrated. All improvements in product design and service offering were welcomed by the customers, but it was not clear whether these would influence customer satisfaction on one hand, and customer loyalty on the other hand (considering that there must not be a linear relation between customer satisfaction and customer loyalty). The decision was taken to include "the voice of the customer" for the identifying the mentioned decisive moments that drive customer experience.
The project was set up in 5 different phases:
- Identify all business relevant customer interactions within the process value chain (Attract, Negotiate, Sign, Provide Service, Incentive re-purchase)
- Perform surveys with a solid customer base / car dealers / internal departments to identify the critical customer interactions that have a high influence on a positive customer experience.
- Consolidate all results and identify the "hot events" in customer interactions and experience
- Define improvement measures for increasing a positive customer experience for all "hot events"
- Match the results with the existing customer segmentation to decide for which segments the improvements across the process value chain should be offered
For the first phase, a panel of international business experts was invited to give their "business inside" view on the critical customer interactions. The result was a roadmap with 13 identified events, to be challenged with the viewpoint of the customers, the car dealers and internal business process owners. This phase has taken a lot of time because each business expert had his own view on business relevant customer interactions: Marketing people always emphasize the importance of managing the brand experience throughout the customer lifecycle, and especially during the "attraction" phase. Customer service has a lower importance from their viewpoint. Sales people tend to concentrate everything on the right pricing model: if competition is offering better sales incentive for dealers, those prefer to sell the financing contract they receive the highest sales commission on. Customer service employees emphasize the urgent need of the right processes and systems in place, in order to quickly identify customer history, to be able to gather all relevant information to solve customer inquiries and complaints, and by this means improve the customers' experience during the handling of the contract.
Graph: Process Value Chain
During phase 2 the different surveys and interviews with customers, dealers and internal process owners have been conducted, and the results of the surveys were "eye opening". While customers would rate a transparent advice on the different financial products, payment structure and contract terms as very high, dealers and internal process owners would rate this customer interaction as low, as their experience would show that customers don't ask that many questions about it. Another example is the assessment of quality of service: Customers rated the internal coordination of contact persons and interaction channels during purchasing evaluation as very high, internal process owners would not. On the other hand, process owners would rate several customer interactions as very high, that customers would not even consider as important at all, e.g. "change payment options" during the PROVIDE SERVICE process.
As a result of phase 2, 13 critical "hot events" were consolidated across the different perspectives (customers, dealers, internal process owners), 3 less than indicated by the customers. For these 13 hot events, improvement measures classified in product (terms and conditions, pricing, etc.), process (responsiveness, timeliness, etc.), system (infrastructure enhancements, interfaces, etc.) and quality of service (training of customer service personnel, resource optimization, etc.) were identified.
Regarding the match with the existing customer segmentation, the decision was taking not to differentiate the defined improvement measures across different customer segments, but allow all customers to profit from the improvements. This would impede the comparison of a "before and after" across customer segments, but would increase a positive customer experience across all customer segments. This was considered as crucial due to the upcoming and expected possible economic downturn. A slight distinction has been made for private and business customers: business customers should receive an outstanding treatment during the whole negotiation process, showing them the added value and long-term benefits the perfect fit of finance/leasing model would allow them.
The project was concluded at the end of 2007, and customer satisfaction has raised significantly in 2008. Even if not all "hot events" identified by the customer have improved, at least a first step towards integrating customer needs and expectations into products and services, in order to positively influence customer experience, has been made. There was no timing for training the whole organization on the new procedures / improvement measures implemented, it was reduced on customer service agents and dealers in order to be able to give the correct information to the customer.
In the current situation, at the peak of downturn, more emphasis is given to those hot events in the PROVIDE SERVICE and INCENTIVE REPURCHASE processes, in order to keep customers happy and loyal. The hot events defined for this phases are changing contract terms, obtaining quick and reliable resolution on issues, the whole complaint handling process, and receiving critical dates on contract ending and personalized offers close to the end of the financial contract. New business is not being generated, but a significant customer base keeps loyal, and let's our client survive the current economic situation.
It is planned to re-activate the project in the upcoming years, and to enlarge the improvement measures also to the hot events identified for the rest of the processes of the value chain: ATTRACT, NEGOTIATE, and SIGN. By this means, true involvement of customer expectations toward a positive customer experience are being considered for the core processes of the company.
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About the Author
Silvana Buljan is a CRM/CEM specialist in the automotive and services industries. Her experience starts in 1998 as a Price Waterhouse consultant being involved in different CRM projects in Europe. In 2002 she founded her own business consultancy SMARTWORXX with the focus on defining applicable CRM/CEM projects at her clients, involving the entire organization. Currently, she is running her newly set up company Buljian & Parnters Consulting. Her expertise is the implementation of those projects by improving processes, and training all employees to make the cultural changes happen, and get more customer orientated. |
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