Connecting customer loyalty to improved customer experience

By | December 2, 2013

One of the most important issues I deal with regularly is how to estimate the business benefits of improving customer experience.

One good source that I turned up is IDC’s Business Strategy: Digital Services Impact on Customer Retention and Acquisition resulting from customer and bank surveys in Europe and the U.S.  An interesting idea is the link between the usage level of digital channels and the customer’s satisfaction with that channel.  I would have guessed that such a correlation exists and the IDC report supports a darn-near linear relationship.  I like the idea of using the usage level of your mobile app as an approximate measure of customer satisfaction with the mobile channel and as a component of overall customer satisfaction.

They add that the low adoption rates indicate that the banks have failed to design the mobile apps from the customer’s perspective — a strong argument for taking a strategic design approach, in my view.  They point out specific areas where their research indicates banks should focus, such as new-account-opening and chat. Security and convenience are listed as the most important factors to customers.

An approach to determining what someone needs in order to stay (that frequently works) is to ask them.  According to customers: “In all countries, over 80% of respondents felt that digital services were either very or somewhat important in keeping them as a client. In Germany, that number was over 90%.”  In fact, 14% of respondents said that they had closed an account because of poor/missing digital services.

If you are considering investing in digital channels as a means to improve customer experience then you are not alone.  Nearly 80% of the banks in the U.S. have this strategy.

 

 

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