An article in Digital Banking Report 2016 (“State of the Digital Customer Journey”) included a statistic that, frankly, is astounding. In a digital age when it’s easy for customers to quickly pick up and move their accounts to a competitor, 45% of banks and credit unions haven’t developed an organized onboarding process. Does that even make sense? Today’s digital technology can make the new account process easy, efficient and cost-effective.
Many institutions still think a fully digital account-opening process would be nice to have, but not really necessary. It’s easy to see why they’d make that mistake, but it can be a costly one. Consider these commonly-held beliefs about customer onboarding:
1.The cost of implementation isn’t worth it. Some think their existing process works fine as it is. They can use their core system to help them keep track of customer information. Isn’t that good enough?
Wrong. An effective onboarding process offers a fast ROI. Not only does it quickly allow the customer to begin making the most of his account, but it also creates a more satisfying experience, instilling confidence that her new bank has it together. A study by Avanade on the effect of customer experience programs for banking and capital markets firms reported significant returns, $5 for every $1 spent.
Javelin Strategy & Research (“Convert ‘Silent Attrition’ into Banking Engagement and Profits”) found that effective onboarding and activation, which emphasizes customer engagement, can help financial institutions boost profitability by $212 per customer.
2.The branch is the heart of our customer relationship. Not so much anymore. Customers enjoy feeling they are important to their financial institution, and being greeted by name feels great. But, with the use of digital banking skyrocketing, how often do customers physically visit the branch to even talk with a customer rep?
With a well-planned onboarding process, your bank can gather customer information for use in creating targeted, personal offers. Combined with a robust customer engagement platform, you can identify and effectively cross-selling relevant products and services. Customers will know their bank is paying attention because they receive advice and offers tailored to their specific needs.
3.Customers don’t want to be bombarded with communication during their account opening process. Some institutions feel this will turn people away.
The fact is, new customers, especially millennials, appreciate it when their bank shows an interest in them – particularly if it relates to their interests. Rather than just depositing their checks and getting a monthly statement, they appreciate receiving advice and information about promotions that are relevant to them. But it is a balance: Don’t blast them with emails about every product and service available. Not only could it be confusing, but it also may cause them to zone out when they receive future offers. Send information that is appropriate for their stage in life or special offers that relate to felt needs you learned about during account opening.
Interested in seeing how a structured onboarding process can help enhance customer experience and profit your community bank or credit union? Download our ebook: Playbook: How to Boost Customer Value with an Onboarding Program at your CFI.