A Personalized Customer Experience in Banking Matters Now More Than Ever
What are you doing to compete with the digital convenience of bigger financial institutions?
The digital transformation in banking over the last decade is unlike anything the industry has ever seen. What started with paperless services and mobile apps has turned into digital-only banks, open banking, and now artificial intelligence. These features provide consumers with something they desperately want: Speedy access.
There is no question that these features are crucial to customer experience in banking. However, as community banks and credit unions have been chasing the digital services of bigger FIs with unlimited budgets, customers across the nation still crave personalized interactions with their FI. That is what you should be chasing.
Not All Speedy Access is Good Access
Customers want quick interactions, but more importantly, they want meaningful interactions. Despite the growth of digital banking and significant AI investments, nearly 2/3 of consumers want one-on-one personal conversations with bank representatives. In the pursuit of better digital services, community banks and credit unions have created colder relationships with their customers.
Speedy access to a chatbot, for instance, provides many answers to customers. But when they hit a wall, once they need a higher level of interaction, the speed of accessing a quick answer loses its value. Digital services are great for productivity, but must include an offramp to a warm conversation with a real person. Most consumers (70%) consider a consistent communication experience when moving from one communication channel to the other very important when choosing a primary FI.
The Power of Advocacy
Beyond the desire for meaningful interactions from consumers, community banks and credit unions must see how the value of interactions directly correlates with customer advocacy. We define customer advocacy as customers actively promoting and recommending their financial institution to others. According to recent data, FIs with the highest advocacy scores grow in revenue at nearly 2x the speed of those with lower scores.
In other words, even in the age of digital marketing, word-of-mouth advertising from customers is still one of the best promotion channels. This is especially true for community banks and credit unions, whose personal connections to their community are often what makes them stand out from their local competition. A personalized customer experience in banking, one that creates meaningful relationships between consumers and their FIs through innovative tech and one-to-one interactions, breeds advocacy.
Innovation Should Lead Directly To Better Customer Experiences in Banking
In a landscape where consumers overwhelmingly bank online, they also acknowledge that it can be cold and lack the proper human interactions when necessary. The reality is that strong relationships are still critical in banking. 9 out of 10 consumers who feel valued by their FI will remain loyal to that institution. A phone screen is cold. Customers must be met with warmth, even when deploying innovative digital solutions.
For community banks and credit unions, this is a supreme advantage they might be neglecting. While big FIs and digital-only banks provide convenient services, they cannot contend with the relational value that drives advocacy and loyalty at community banks and credit unions. Every innovative effort in 2025 should be geared towards a better customer experience for your customers and members. Don't abandon what makes your bank or credit union special. Your customers don't want you to.