Four ways to increase share of wallet in the financial services industry
Harish Agarwal, Head of Customer Experience Strategy for SEA, India and Hong Kong, Qualtrics.
To fully understand what will drive future success for financial service providers, it is important we look beyond the rise of digital in recent years.
While there’s no denying digital is now the default channel for many consumers and providers, the uptake of such services and products represents more than a digital transformation. Rather, it’s evidence of an experience transformation underway in the industry as consumers hunt for products, services, and experiences tailored to their specific needs.
For traditional and disruptive financial services providers, a higher share of wallet will only be achieved if their offerings - both digital and face-to-face - satisfy and exceed people’s rapidly changing needs, behaviours, and preferences.
To give an example of the opportunities presented by the industry’s experience transformation, a recent Qualtrics study revealed a third (32%) of consumers across Asia Pacific have increased the amount they’ve invested since the start of the pandemic - with 61% planning to invest more in the next 12 months. This behaviour shift represents a significant opportunity for providers to increase customer loyalty and share of wallet by ensuring they are offering products and support aligned to it.
Saving options and financial wellbeing presents another opportunity. The majority of respondents (78%) to the study said they have been more mindful about money since the start of the pandemic, with 52% saying they’ve saved more. Over the next 12 months, 73% of people said they will save more money. Making services available that help consumers manage and improve their financial wellbeing can be a significant differentiator for providers moving forward.
The value of superior experiences is further demonstrated when we look at what’s driving trust in financial service providers, and the reasons people are opting for digital-only providers. Alongside competitive rates, the quality of the mobile app and website, products, and customer service are the top factors driving trust. Consumers said they were opting for digital-only offerings for better customer experience, lower fees and charges, flexible products, higher returns, and more personalisation.
Experience is the driver of change in the financial services industry, and digital is the way it’s being delivered.
Four ways to increase share of wallet
To help financial services providers succeed in the rapidly changing industry, Qualtrics highlights four key capabilities to prioritise in order to generate share of wallet:
Partner for success
In our rapidly changing world, it’s unrealistic to think any one provider has all the capabilities needed to satisfy evolving consumer demands. As such, being able to understand how preferences are changing and then working with organisations to quickly address those needs with the launch of new services gives providers a competitive advantage.
For example, in 2021 the international bank Standard Chartered announced a partnership with Indonesian e-commerce provider Bukalapak to launch new digital banking options for businesses in the country. The bank also partnered with Singaporean fintech BetterTradeOff to launch a free financial planning solution.
Build for the future
Demand for digital banking services and tools is highest among Millennials and Generation Z, both of which represent a growing portion of consumer spending. By understanding how usage of digital channels is evolving among these demographics, providers can lay the foundation for a successful and prosperous relationship with their current and future customers.
The push to innovate payment options, such as the proliferation of Buy Now Pay Later offerings and digital wallets, is proof of the generational change underway in the industry.
Brand trust remains the leading factor in consumer satisfaction across financial services, followed by competitive rates, good products, and overall customer services. Capturing consumer insights to identify what actions foster trust, and how to position your brand and products will help traditional and emerging providers attract and retain customers.
One of Australia and New Zealand’s largest financial services companies - ANZ - is a great example of an organisation using insights to deliver on its mission of being a trusted advisor...by understanding what our customers and people think, feel, decide, need and do. The comprehensive customer and employee listening programs at the organisation allow it to continually and rapidly iterate designs and ideas based on direct feedback. This allows it to offer new products and services with confidence and precision.
Act on feedback
The Qualtrics study revealed that consumers overwhelmingly want their providers to listen to them, and they will buy more services from you when that feedback is acted on. Nearly half (47%) of respondents said it was unlikely they’d purchase from a provider in the future if the organisation failed to respond to their feedback.
Rapidly growing insurtech provider bolttech has placed acting on customer feedback at the heart of its customer experience as it embarks on a journey to transform the insurance industry. Using experience management tools the company has developed workflows so that every time a piece of negative feedback is received someone is automatically notified so they can follow up. It means that instead of letting a customer reflect on a bad experience, within minutes bolttech has proactively addressed that frustration.
Digital is second to experience
While digital is an enabler of great experiences in the financial services industry, the change underway is being driven by evolving consumer needs, preferences, behaviours, and expectations.
For providers - both traditional and emerging - their future success is dependent on their ability to continually listen to consumers and the market to understand changing needs, and then take rapid action to design and continually improve the services and experiences people want.
Watch XM Live: Experience Transformation in the FSI Industry to discover how Asia Pacific’s leading financial service providers are delivering great experiences with experience management