Market Focus: Financial Services--Stocking the Customer Experience

Although the financial services (FS) industry was one of the early CRM-adopter verticals, it's not hard to understand why some FS companies continue to fight to create and maintain loyal customer relationships. Competing for customers in a crowded market of heightened fraud, M&A, compliance, and lean margins is just one of the issues these institutions deal with. And frankly, for some FS companies CRM means more emphasis on boosting the amount of customer transactions than on delivering a consistent multichannel customer experience as a competitive differentiator. Not all FS firms fit into this category, but some of those that do are waking up. "Trying to manage that customer experience is where they're at now, to increase customer loyalty so that you can actually grow relationships and generate that profitability," says Kim Collins, a research vice president at Gartner. But taking a disconnected approach of various siloed applications across channels and departments, rather than creating a single view of the customer, makes improving the customer experience harder. Collins recommends focusing on customer data integration, branding, and consistency of message for more effective customer experience management. "You can leverage a lot of marketing capabilities to understand the customer, segment the customer. Then, feed that back into how you create dialogues, how you brand your messages to different constituents, and how that supports your overall brand of the company." With a single customer view, initiatives like event-based marketing and customer segmentation become easier and more effective. FS companies must craft segmented views of their customer base for more successful marketing efforts. For example, affluent FS customers may respond to marketing campaigns that less wealthy FS consumers wouldn't, and vice versa. Frank Florence, vice president and CMO of Chordiant, says that new CRM systems for banks today should be multichannel, focused on customer and not product, segmented, behavior-based, guided, and dynamic. "Some of the core technology elements that banks have used over the years have been decisioning, workflow, and Web services," he says. "We're seeing this now more than ever as major banks make a move toward SOA platforms, trying to unite the silos of their business units, and really put together a common view of the customer." With so much data, though, it's no surprise that privacy, fraud, predatory lending, and compliance issues remain hot buttons in the FS industry. But Collins says that the compliance element in particular is requiring FS organizations to be accountable for their CRM expenditures. Sarbanes-Oxley "is driving much more business-case orientation around CRM and trying to prove the ROI in CRM initiatives." Case Study Monitoring For Miscommunication Union Street Mortgage Company (USMC), which can originate, process, underwrite, close, and fund most loans in-house, has a relationship with a Wall Street firm that owns a large, lucrative national mortgage servicer. To establish this client relationship, however, the Streeters required USMC to capture loan officers' calls with customers, a capability the mortgage company lacked. It had to take action. The firm wanted USMC to provide it with recorded calls if needed in "a situation where there may have been miscommunication with a customer or there was a misunderstanding of the terms of the transaction," says Ron Blake, one of USMC's owners. The mortgage business also sought to implement a system that would allow it to monitor and record loan officers' conversations with clients as a way to provide ongoing training to its loan officer pool. The company selected VirtualLogger, a hosted call recording/quality monitoring offering from VoiceLog, whose third-party verification business was acquired by BSC Clearing Solutions North America in June 2006. The deployment went live July 2005. When factoring in several components, such as the cost of buying and maintaining an on-premise option, having selected VirtualLogger instead of an on-premise system allowed USMC to achieve savings that "would easily be $100,000 per year," Blake says. Along with cost savings and the ability to provide ongoing training to loan officers, the solution "protects us so that we can recall conversations that may or may not be in dispute," Blake says, and gives callers "a certain amount of comfort knowing that their call might be recorded in case something happened." --C.B.