AI and automation can smooth your frictionless customer experience

A version of this article first appeared in BAI’s June Executive Report: Elevating customer service across the enterprise. You’ll find insightful coverage in the issue on SMB customer care, practical AI use, investing in call center talent, customer-focused SaaS that’s designed for the financial sector, plus much more.

Today’s banking leaders must continuously adjust their customer experience (CX) goals to address how fast digital banking technology and customer expectations evolve. It can be costly to misallocate CX resources, and yet just as costly to ignore the shifting marketplace. Navigating this delicate balance ensures customer satisfaction while reducing operating costs amid continued economic uncertainty.

Banks with frictionless CX programs have discovered the secret to success more than those without such programs. They leverage cutting-edge technology across silos, a win-win that creates operational efficiencies that not only grow revenue, but also deliver high-quality customer interactions. The keys? Automation and artificial intelligence (AI), which compound the efficiency needed to ensure the backbone of frictionless CX best practices.

Frictionless CX—the ability of banks to interact with customers in truly personalized ways—is pivotal in an increasingly digital world. Banks that fall behind on frictionless CX risk losing business to peers and competitors. Interactions should be channel agnostic, spanning online, phone, social media and in-person interactions, and be done harmoniously across multiple departments, ranging from the back office to service, which directly and indirectly inform customer conversations and delivery.

Here are 7 operational considerations if you want to maximize client value and reduce costs:

1. Frictionless CX drives greater success: Earlier this year, Aberdeen Strategy and Research surveyed nearly 90 banking CX leaders to understand the key trends behind their CX goals and how they use automation and AI. The most critical challenge these industry players face is the lack of technology needed to support these activities, followed by continuous economic and supply chain disruptions. However, these issues are not insurmountable, and those who have overcome them are seeing positive results. The top 20% of respondents were dubbed “best in class,” a group achieving superior outcomes across key operational and CX metrics, including annual revenue and customer loyalty. These best-in-class banks report a 24.2-times greater year-over-year increase in customer satisfaction (21.8%, up from 0.9%) and a 51% year-over-year increase in the customer retention rate (80% versus 53%). Thanks to superior CX results, the best in class saw a 31.3% year-over-year increase in company revenue, while the others reported a 3.1% decline.

2. Technology isn’t enough for success; customers want personalization: Technology and convenience go together when delivering a frictionless experience for customers and employees. Yet in a highly competitive market filled with eager competitors, customers hold the power, and banks need to optimize each touchpoint along the customer journey to retain their business. To cater to today’s customers while addressing challenges, banking leaders are revamping how they structure their CX strategies and programs with investments in CX technologies, enriching customer interactions through data-driven, personalized insights and creating a unified view of customer data available to key internal stakeholders.

3. Frictionless CX requires building blocks: Technologies that synchronize data across different channels and systems in real time allow banks to create a unified view of customer data. AI and automation are cornerstone technologies for frictionless CX programs that deliver effortless experiences for both customers and internal teams serving client needs. With that in mind, leaders understand that delivering a frictionless CX is contingent on having accurate and timely data for stakeholders to leverage when making key business decisions, such as determining where to open a new branch location based on where customers live and what high-touch service they may desire.

4. Smartly incorporating AI and automation: The best performers weave AI and automation capabilities across their CX activities and across banking units to enhance the quality and accessibility of their data, ensuring that employees are empowered with relevant insights in a timely fashion to deliver superior customer experiences, regardless of business function or touchpoint. Specifically, the best in class is 30% more likely to leverage technologies, such as AI and automation, to automatically connect data across all their systems (e.g., CRM, billing, loyalty, payments) and establish a single view of customer data (95% versus 73%). This helps banks consolidate all operational data into one location, ensuring reporting consistency across all departments. Furthermore, they are also 53% more likely to use automation to update and integrate customer feedback across all touchpoints (89% versus 58%). With banks increasing the number of digital channels they use, having the technologies to automatically capture, standardize and integrate data becomes critical to ensuring a 360-degree view of customer and operational insights across the entire journey. Automatically integrating data across channels enables a unified system that is consistent across departments, supporting the alignment of CX goals.

5. Employee collaboration is powerful: By improving information access with AI and automation, the best in class is also 13% more likely to enable and encourage employees to collaborate, whether they’re in the back office or front office (89% versus 79%). Empowering employees with the right reporting and training tools, strengthened by AI and automation technologies, improves overall employee experiences, ultimately paving the way to happier customers.

6. Strategic data use is also necessary: Best-in-class banks also use technologies with advanced analytics capabilities to harness the true power of their data and supercharge frictionless experiences. When it comes to using customer data to improve their CX activities, the best in class is 22% more likely to share customer feedback data through role-based reporting using technologies that encourage real-time access (95% versus 78%). Going even further than increasing data visibility across all departments, the best in class is also 31% more likely to use root-cause analysis interactions to understand factors influencing customer experiences (84% versus 64%). Collecting and analyzing customer data helps banking leaders understand key inflection points along the journey so they can take the steps needed to drive desirable business results.

7. Link technology with KPIs: With numerous channels and branch locations to oversee, the best in class is 27% more likely to have the ability to compare branch performance against similar ones, based on attributes such as location or size, using predictive analytics or AI-driven algorithms (76% versus 60%). In addition, the best in class is also 36% more likely to leverage AI to monitor and automatically trigger alerts when specific CX activities fall below certain KPIs (68% versus 50%). For example, bank supervisors can receive alerts when their branch lags in a KPI compared to similar branches so they can revamp their training programs and resources accordingly. Using advanced technologies allows banking leaders to proactively—rather than reactively—adjust their internal activities to create a more frictionless experience for customers.

Grow with customers top of mind

Banks today face numerous challenges both externally, from economic and supply
chain conditions, and internally, from a lack of the right tools to conduct their business. Continued success is contingent on upgrading CX programs in a way that reduces inefficiencies while still exceeding customer expectations.

To foster a frictionless CX program, banks need to not only adopt advanced technologies that foster automation and advanced analytics but also use them strategically across all business activities. The best-in-class leaders are maximizing data from their channel mix and setting up employees for success. Without a doubt, better customer experiences are tied to better employee experiences. AI can alert leaders when key metrics are being missed so they can proactively revamp their strategies to better meet customer needs.

Banking leaders who adopt and efficiently use cutting-edge CX technologies deliver the experiences that modern customers desire by empowering both front- and back-office employees. In doing so, banks position themselves to continue to grow and prosper in the future. Organizations create happier customers and long-term relationships to drive future growth. These efforts are critical to success today—and in the long term.

Omer Minkara is Vice President and Principal Analyst with Aberdeen Strategy & Research, a ServiceNow partner. He led the research cited in this article.