DIGITALIZATION Vs QUALITY OF BANKING SERVICES
I. Introduction
The success of a banking product/service on the market depends on the value perceived by the customer in relation to the cost he has to bear, and therefore on his satisfaction with the quality/price ratio of the banking product/service in question.
This value is the result of a combination of several factors, such as the product/service’s superiority (comparative advantage over other competing products/services), its simplicity (product/service that is easy to understand and use), its compatibility (product/service that integrates easily into the customer’s environment), its technological credibility (product/service that relies on a proven technology in terms of reliability and security).
With the growing development of digital financial products and services, the quality and satisfaction of customers with these products and services has become an integral part of the new notions of “digital customer journey” and “digital customer experience”, notions that have become essential in the face of consumer demands to be able to carry out an “ATAWAD” transaction at any time, anywhere and with the terminal of their choice (Any Time, Any Where, Any Device).
II. Measuring customer satisfaction with a digital offering
Various tools can be used to measure the degree of customer satisfaction with a digital banking service, such as the Digital Customer Satisfaction Barometer, the Customer Effort Score and the Net Promoter Score.
1. The Digital Customer Satisfaction Barometer (DCSB)
It focuses on the quality of the bank’s digital product/service offering, with the aim of capturing the various dimensions of digital customer satisfaction, such as, for example:
- Ease of use of digital banking services
- Functional quality of digital banking services
- Customization of digital banking services
- Perceived risk (security and confidentiality) of digital banking services
- Trust in digital banking services
- Loyalty towars digital banking services
The DCSB thus makes it possible to assess, on an annual basis, the evolution of customer satisfaction.
Customers are invited to give their opinion on a certain number of statements.
2. The Customer Effort Score (CES)
It aims to facilitate the customer journey by reducing the effort required at each stage of the purchasing process.
Its aim is to measure the effort required by a customer during his digital journey.
This is based on the principle that the lower the level of effort, the more satisfied a customer will be, and the more likely he will become a loyal customer.
The customer effort score is used to evaluate specific points in the digital customer journey.
To do this, we ask a customer how much effort he had to put in to see his request processed by his Customer Advisor.
The Customer Effort Score is used to determine the level of customer satisfaction and the fluidity of the experience offered by the bank. It is therefore a crucial element in any strategy to increase loyalty and improve the digital customer experience.
In customer satisfaction surveys designed to measure CES, the question should be simple and target a specific point in the customer journey. For example :
– How much effort did you have to put in to reach our customer service department ?
– How much effort did you have to put in to get the service you were looking for on our website ?
It’s also a good idea to add an open-ended question after the question, such as :
– Can you tell us why you chose this answer ?
This allows the respondent to explain his answer, and thus to identify the areas of the digital product/service that require improvement.
Calculating and interpreting the Customer Effort Score.
For its evaluation, the Customer Effort Score can be built around 7 levels signifying the level of effort : Extremely Easy – Very Easy – Rather Easy-Neutral – Quite Difficult – Very Difficult-Extremely Difficult.
Based on a chosen scale ranging from 1 to 7, scores are grouped into 3 categories for evaluation purposes :
- Low effort : grades 1 or 2
- Moderate effort : grades 3 or 4
- High effort : grades 5, 6 or 7
The formula to be applied is :
CES = [Percentage of high effort] – [Percentage of low effort].
The calculation gives a score between – 100 and + 100
The CES score obtained can be used to discern trends at different stages of the digital customer journey, and to alert customers to areas requiring action. CES can also be used to prioritize urgent issues. Priority stages are those with a score of 4 or 5.
To be effective, the CES needs to be assessed on a regular basis, and at as many stages of the digital customer journey as possible. The first thing to do is to map out the customer journey, defining all the stages through which the customer passes.
On a bank’s website, for example, there are numerous stages on the customer side, such as :
- Step 1 : Find the product I’m interested in (credit card)
- Step 2 : Gather product information (features, terms and conditions, timeframe, rates…)
- Step 3 : Confirm order
- Step 4 : Pay the order
- Step 5 : Receive my product at home
The more detailed the customer journey, the easier it will be to identify “pain points” along the way.
3. The Net Promoter Score (NPS)
It measures the propensity and probability of customers recommending a given product or service. It can be used to assess customer satisfaction and loyalty at a given moment, and to monitor the evolution of the customer/product relationship.
Net Promoter Score is a score given by customers in response to a single question : How likely is it that you would recommend product/service X to someone close to you?
Respondents give a score between 0 (not at all likely) and 10 (very likely) to the above question. These scores place them in one of three segments :
- Detractors : score between 0 and 6 : dissatisfied customers who may harm the brand or product through negative word-of-mouth.
- Passives : score between 7 and 8 : satisfied but unenthusiastic customers who are likely to be seduced by the competition
- Promoters : score between 9 and 10 : very satisfied and loyal customers who spread positive word-of-mouth and contribute to the development of the brand or product.
To obtain a representative NPS, it is necessary to collect as many responses as possible from users.
Calculating and interpreting the Net Promoter Score
First, convert the number of responses per category into percentages.
Then subtract the percentage of detractors (score between 0 and 6) from the percentage of promoters (score between 9 and 10).
Example :
Out of 1000 respondents, 250 are categorized as detractors (i.e. 25%) and 400 gave a score between 9 and 10 (i.e. 40% promoters). The NPS is therefore (40 – 25) = 15.
An NPS higher than 0 is considered to be a good satisfaction index.
A score below 0, on the other hand, means that the customer’s relationship with the brand or product is unsatisfactory, and that remedial action needs to be taken.
If the NPS reaches 50, the brand can count on strong loyalty and attachment from its satisfied customers, who will be very inclined to recommend it.
An even higher NPS, approaching 100, is synonymous with exceptional satisfaction.
Although this level of satisfaction is very rare, some brands have succeeded in forging an emotional bond with consumers, turning their customers into true fans and ambassadors.
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In short, DCSB, CES and NPS are complementary satisfaction indicators.
The CES helps identify areas for improvement to make the digital customer experience more fluid, while the NPS identifies the percentages of detractors and promoters among customers. The latter act positively or negatively on the brand image via customer reviews or messages posted on social networks.
The DCSB will enable us to fine-tune our digital marketing strategy, with the aim of making the customer experience more fluid and enhancing the bank’s brand image.
III. Digital Banking and « High Tech - High Touch » Dilemma
In the digital age, high-tech approaches to customer service and customer experience are often contrasted with, or even considered superior to, traditional face-to-face interactions.
Technology has certainly brought greater convenience, putting consumers truly in the driver’s seat, where they can bank 24/7, 365 days a year, from the comfort of their own home.
However, in the digital world, customer journeys often lack the essential human part of a transaction or process, meaning that these high-tech customer journeys are sometimes more difficult and less satisfying than the low-tech, high-human processes they were meant to replace.
- Arguments in favor of a High Tech Model :
From a business point of view, banks often favor self-service channels, as they enable them to serve their customers at lower cost.
Today, self-service and high-tech customer experiences are acceptable if the technology is intuitive and easy to use, and/or if the customer journey and product are simple enough to be understood and completed online, without assistance.
However, in the case of more complex customer journeys such as mortgage applications, some studies have found that customers often revert to assistance via traditional face-to-face contact : for example, around 80% of customers said they preferred assisted channels to rectify errors made by the bank, and around 70% expressed a preference for human help when it came to obtaining answers to specific bank-related questions.
If customers are unable to complete their customer journey online, they risk finding themselves alone, stuck in a self-service world communicating with AI robots, or, if forced to visit a branch, stuck in long, laborious processes.
Customers are discovering that their banks rarely offer a plan B, which means they either have to restart their journey from the beginning on a completely different channel, or abandon the digital process altogether.
This digital exodus of so-called “digital misfits” creates frustration among customers suffering from their “illectronism”, and adds to banks’ costs.
- Arguments in favor of a High Touch Model :
Some clients, particularly in the older age brackets, often prefer to speak to a human interlocutor because they can achieve a level of trust, clarity and fine-grained understanding that is not available in most digital self-service channels or in traditional call center interactions.
Having to visit a branch can nevertheless prove inconvenient for the customer, and is not the most cost-effective approach for the Bank to answer customer queries.
Banks therefore have a choice between continuing to offer a separate, high-tech, high-level service model on the one hand, and combining the relative advantages of the two models on the other.
A priori, there is no reason why banks should limit themselves to offering a high-tech or high-touch customer experience.
The best solution is one that combines the advantages of digital and human interaction, through smarter contact centers that enable agents to offer the same level of visualization and functionality as in the branch, thanks to a unique live screen-sharing solution for displaying product information, sharing documents, verifying identity and collecting electronic signatures.
This will enable banks to offer a high-tech digital service that enables their customers to complete their journey in an efficient, convenient, attractive and cost-effective way.
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