Financial Service

CXM Editorial TeamCXM Editorial TeamMarch 23, 2018


The recent cold weather snap known as ‘the Beast from the East’ may have caused havoc to the UK’s transport system, but it provided a welcome increase in online sales, according to newly released figures.

UK online retail sales were up +13.1 percent year-on-year (YoY) in February, according to data from the IMRG Capgemini e-Retail Sales Index. With the Beast from the East hitting the UK in the last week of February, the cold weather saw shoppers turn online in their droves, driving a +3.5 percent lift in sales compared to the previous week. This continues 2018’s positive start, with overall year-on-year growth averaging 13.5 percent year-to-date.

Despite the strong sales however, the overall market conversion rate (the percentage of site visitors that complete a purchase) was 4.2 percent, down from 4.6 percent last year. The conversion rates for both multichannel and online retailers also came in lower than February 2017. However, the average basket value (ABV) rose by £11 in comparison to last February.

Meanwhile, smartphone growth remained strong at +38.5 percent on last year, but is certainly slowing when compared to the +57 percent growth of last year. Tablets, on the other hand, continued their now four-month long decline trend, decreasing -6.7 percent year-on-year, a record low for this device type.

Some sectors performed notably well this February. Health & Beauty grew by +33.85 percent year-on-year – its highest growth in the last five years. In addition, Clothing continues to show strong year-on-year growth, up +14.9 percent, with accessories and footwear the top performers within this at +22.3 percent and +20.4 percent respectively. Finally Gifts also grew by a strong +9 percent year-on-year, a significant improvement on last year’s -3.3 percent.

Bhavesh Unadkat, principal consultant in retail customer engagement at Capgemini, said:

“February’s sales patterns clearly demonstrate the power of extreme weather on shopping habits; as people avoid the high street in favour of cosier shopping from their well-heated living rooms. As the snowy weather continued well into March we anticipate a continuation of this trend in next month’s results. We’d also draw attention to the performance of the US retail market, which has just reported its third consecutive month of falling sales. As the US market is often seen as ahead of the UK’s this could foreshadow a similar trend in the coming months. Fortunately for internet retailers, the US reported +1 percent online sales growth.”

Justin Opie, managing director, IMRG, added:

“Over the course of many years, the overall conversion rate for online retailers crept up very slowly but this has stalled recently and has now actually been in decline for three consecutive months. This suggests that shoppers are spending more time browsing, potentially across a greater range of sites, before making a final purchase decision and that may well be true, but a clear influencing factor is a shift in the devices people are using for shopping. In Q4, 32 percent of online retail purchases were completed on smartphones (the rest were through desktops and tablets) – these devices tend to have lower conversion rates due to a variety of reasons, particularly how much more susceptible users are to being distracted when using them.”

Andrew TavenerAndrew TavenerMarch 20, 2018


Online retailing has expanded rapidly; the growth of the internet and advancements in delivery capabilities have seen many small businesses take advantage of this, selling through online marketplaces to maximise their reach.

These global marketplaces are predicted to own 39 percent of the online retail market by 2020. On the surface, this approach is perfect for consumers who can easily shop from their favourite retailers all in one place. However, underneath, retailers are faced with the difficult and sizeable task of managing the deliveries and returns efficiently and at a low cost.

For while more marketplace exposure means more sales, it also equals more returns; made even more complex by the requirement to offer the return policies designed by the marketplaces. For example, Amazon now requires third-party sellers to accept “automatically authorised returns”.

This means retailers must accept returns without having any direct contact with the customer, exactly when many businesses try to resolve customer issues to preclude returns. There are, however, ways to improve the control of online returns in the face of changing customer expectations and marketplace practices, which are critical in this competitive environment.

Understanding how best to manage product returns to reduce costs and maximise efficiency is key. Here are four strategies online retailers can use to tighten the returns process:

Return policies must be a forethought

Marketplace policy changes give retailers the opportunity to rethink how they handle returns. According to recent research from Royal Mail, nearly half of shoppers (47 percent) said they would be unlikely to shop with a retailer again if it charged for returns, and 60 percent would be less likely to shop with them again following a difficult returns experience.

Clearly a well thought-out returns policy is critical to good customer relations. Sellers need to decide whether to offer one return policy – for example, Amazon’s – or different policies for each marketplace/channel or for various product offerings (for example: low-end versus high-end).

Some businesses set policies based on the most generous marketplace policy. If sellers choose an ‘Amazon-style’ return policy with instant returns and free shipping, this can be promoted up front as part of a company’s brand. Unmistakably, a simple online returns process helps drive sales and cement customer loyalty – and overlooking the impact of a poorly considered returns opportunity can be costly.

A free returns policy might not always work

Returns can have a big financial impact on profits. Depending on the industry, return rates can be very low or very high. Book and video returns can run two/three percent, while clothing and jewellery can run upwards of 30 percent. Companies should right-size return policies based on industry standards and actual return rates.

Businesses with healthy profit margins can build the cost of returns into a product’s price. Charging restocking fees or not accepting online returns is less common but, for certain products or industries, it makes financial sense. For example, companies selling new laptops might find a restocking fee may be the only way to support thin margins. Likewise, for clothing subscription services a restocking fee for returns makes sense, since the items are essentially specifically tailored for an individual.

Evaluating whether the return policy of a particular marketplace works is therefore a critical part of the business decision to sign up to the marketplace in the first instance.

Sellers should right-size returns automation based on business needs

Retailers with high return rates may need a great deal of automation. Small businesses with fewer returns can often manage them in-house using cloud-based shipping solutions that simplify printing, or electronically creating return postage labels that customers print themselves. Barcodes on labels quickly identify customer records and product numbers to speed the return process, cut down on errors, and save time.

Integrating with internal systems is important for large retail operations with high return volumes. Returned packages sitting on the warehouse floor cannot be effectively put back into stock without the right system in place. Connectivity must flow from the customer to the warehouse to the shipper into marketing, sales, and accounting.

For companies with few internal fulfilment resources, a third-party processing service can help. Merchants need to weigh the benefit versus the cost of using fulfilment and returns processing by marketplaces or third-parties. Another way to manage returns if there aren’t in-house resources is to monetise returns by sending returned merchandise directly to a reverse logistics partner that liquidates inventory.

Returns cut into profits so minimising them is important

Good customer service helps avoid unnecessary returns by solving a customer’s problem with support, rapidly replacing missing/damaged items, or making exchanges. However, heading off an unnecessary return is hard when marketplaces allow automated returns with no merchant contact.

To combat this, sellers should use ‘scan-based’ return labels when possible. With these labels, the retailer is only charged if the label is used. Some retailers report that 10 percent or more of the requested returns are never actually sent in, making scan based return labels an instant money saver.

Providing customers with current, accurate product information is also important. By connecting ecommerce marketplaces to internal order status, pricing, and inventory processes, customers know if a product is in stock and when it will ship. Detailed product descriptions and quality images help to avoid misunderstandings. Customer feedback/review functions provide even more information to support making the right choice.

Finally, it’s useful to track which products are returned and why. Develop a ‘reason for returns’ report by manufacturer and SKU. This allows vendors to troubleshoot and avoid future returns.

Changes in return policies by Amazon and other marketplaces are an opportunity for ecommerce businesses to take charge of returns. Online sellers can use this as a chance to create better customer communication and loyalty, whilst addressing how returns affect the bottom line and streamline logistics.


Andrew TavenerAndrew TavenerMarch 12, 2018


During Christmas, £17billion worth of goods are said to have been bought online alone, with an expectation for £2.5billion worth of returns to come back.

With retailers and suppliers feeling increasing pressure to fine-tune their logistics and supply chain strategies in order to cope with these levels of orders, and a drastic growth in returns, retailers are under intense financial pressure to get shipments right. Every, single, time!

As a result, to get the level of performance they need from their suppliers, these retailers are increasingly turning to chargebacks. Chargebacks are fees that a retailer charges a supplier for errors as a result of not following business guidelines.

As such, they are a way for retailers to offset the additional expenses incurred if suppliers are non-compliant. Indeed, major retailers globally have been imposing much tighter controls on suppliers in the recent years to help speed up their supply chain. This squeeze on suppliers is seen in fees for late shipments, wrong bills of lading, incorrect labelling or invalid Advance Ship Notices, and many other seemingly small mistakes that can make a big impact. For some retailers, chargeback fines make up as much as 13 percent of their account revenue.

While compliance is a must, suppliers still fail to provide retailers with accurate, timely, and complete information for a number of reasons. These may include differing compliance requirements per retailer; the sheer number of protocols and systems that need to work together successfully; the number of retail trading partners a supplier deals with on a daily basis; and the overall varying IT capabilities of businesses. With all of these factors combined, there are seemingly an infinite amount of issues that can trigger a chargeback, especially during peak seasons or events.

Getting vendor compliance right will have a positive impact on the bottom line. For many suppliers the only true way to overcome the looming risk of chargebacks is to think long term and put an effective programme in place to manage against them. This should identify what triggered a chargeback, how it was calculated, and a way of indicating that a problem has occurred before the penalty is even received.

Here are seven best practices suppliers can build into a chargeback programme to successfully meet retail vendor compliance expectations:

Know the cost: Suppliers should be aware of the cost of chargebacks and ensure that chargebacks are properly detailed in their accounts to assess the true scale of the problem. In this case, what you don’t know can truly hurt you.

Grasp the details: Having insight into individual chargeback information that includes where and when a chargeback occurred and under what circumstances is critical for reducing the chargeback risk. Errors can be missing, incorrect, or non-scannable shipping labels; unauthorised product substitutions; incorrect shipping location or using the wrong shipping provider. Keeping detailed information on file will make it easier to catch small issues that could turn into something larger in the future.

Get the bigger picture: Use tools that can analyse and review larger chargeback trends at a dashboard level. While there is much to learn in the finer details, technology can help automate the process, helping you to find repetitive tendencies that may have previously gone unnoticed.

Understand retailers’ requirements: The truth is every retailer’s requirements are different. It is important to make sure you are clear on each and every one’s specific rules and act upon this knowledge by implementing systems that can keep pace with a broad range of retailer trading partner business rules.

Revisit requirements: It’s good practice to revisit requirements at least annually to keep chargebacks at a minimum over time and break the chargeback cycle. With chargebacks becoming more prominent, retailers’ requirements can change over time with little to no communication.

Chase up or refute chargebacks: Should a penalty be improperly applied, suppliers should arm themselves with information to support a change. The more detail you have, the better off you are in the event of a disagreement.

Invest in automation: Automation can help your business to seamlessly connect to trading partners, rapidly on board new retail customers, identify problems by exception and minimise the use of IT bandwidth. All of these items help to minimise chargebacks in one way or other.

As online shopping and return volumes grow, so do consumer expectations for products to be on the shelf or in the warehouse ready to ship at a moment’s notice. Chargebacks make for a strong incentive for suppliers to keep all the key aspects of their relationship with the retailer in check. However, even though chargebacks are common, there is no reason a supplier should suffer extensively from them.

Getting communication right can drive chargeback costs down, but when ‘perfect’ processing doesn’t go perfectly, knowing how, why, and where an issue occurred helps to proactively address discrepancies and minimise the time it takes to resolve them.

CXM Editorial TeamCXM Editorial TeamFebruary 20, 2018


Online retail sales were up 13.9 percent year-on-year (YoY) in January, according to the latest figures from the IMRG Capgemini e-Retail Sales Index.

With rainfall above average in January, and the lowest January high street footfall recorded in five years, consumers turned to online shopping. Even the expected post-Christmas month-on-month decline in sales from December to January, which came in at -20.4 percent, was less than the five year average of -24.1 percent.

With January sales still an important market stimulus, the electricals sector performed well relative to recent trends, growing +4.4 percent YoY. Its performance sits starkly against last year’s 12 month average (Jan 17 – Dec 17) of -3.0 percent YoY and January 2017’s YoY growth figure of -8.5 percent.

Similarly, sales growth for the clothing sector was up +16.8 percent YoY, its strongest January growth since 2013. Footwear, menswear, and womenswear growth were broadly in line with the five year average, with YoY growth of +13.3 percent, +10.4 percent, and +6.9 percent respectively.

This solid start to the year was secured in spite of a dip in the overall market conversion rate to +4.3 percent from +4.5 percent last year, continuing the decreasing trend as customers browse more before purchasing. Sales via smartphones are also increasing at a lower rate than last year, at +39.3 percent YoY in January, while growth through tablets suffered a decrease in YoY growth of -10.0 percent.

Justin Opie, managing director of IMRG said:

“14 percent growth for January represents a strong start to the year, arguably even surprisingly so. The economic climate remains challenging, with inflation remaining at 3 percent and an interest rate rise anticipated over the next few months. The impact on retail was very apparent in January, with several very large retailers announcing store closures and job cuts – high street footfall also fell to a five-year low for January. Yet online appeared to benefit from that, with the index recording the lowest month-on-month decrease between December and January in five years. It may be that, as we enter 2018, we are seeing signs of an acceleration of the general move over to online, putting pressure on those retailers with large store portfolios to sharpen their focus on rolling out their digital strategy.””

Bhupender SinghBhupender SinghJanuary 31, 2018


Banks are springing into action as the battle for the customer intensifies; according to the recent UK Customer Satisfaction Index, financial services firms have made significant improvements, in comparison to previous years.

Banks and non-traditional financial institutions are shifting their focus away from product offerings toward creating interconnected, simple, and personalised customer service.

However, financial institutions still lag behind retailers and travel providers when it comes to customer service. So, what exactly can they learn  in order to bag themselves a top spot when it comes to enhancing the customer journey?

The customer service delivery model is changing – branch closures and digital trends are changing the way customers bank and engage with their financial service providers. With new regulation and mounting competition from agile digital disrupters, banks are having to rethink how they interact with their customers at every step of the banking journey.

Boosting customer satisfaction is high on the agenda for traditional banks, which are under pressure to reinvent how they deliver to customers in the digital age. Cost pressures on profit margins are driving banks to shut down branches. Closing bank branches is an attractive option to manage cost pressures – the traditional branch can easily account for 40 to 60 percent of a bank’s total operating cost.

Despite the growing trend to shut down branches to manage cost pressures, recent studies find that most customers – including millennials – still prefer having a physical branch nearby. Agile banks are revamping the banking model for the digital banking era to grow and maintain their market share without traditional branch expansion. So, how can banks balance operational costs with innovation?

Traditional institutions are now in an optimal position to direct their attention towards long-term growth transformation strategies enabled by new innovations. These will be directed towards creating a technology-enabled, data-empowered system, which puts the customer at the heart of every business decision.

Banks are directing investment to their back-office to boost operational efficiency, reduce customer churn, and resolve customer enquires faster. Waiting in lengthy queues and being passed from one department to another is a key factor fuelling customer dissatisfaction when searching for the right customer service agent.

In regards to telephone banking, technology is now being used to recognise customers’ voices and predict the purpose of their call based on the status of their account. This enables individuals to be automatically forwarded to the correct department, streamlining the Customer Experience to avoid being passed from pillar to post.

The need for in-person service is very much alive, and in an increasingly digital business landscape, the branch network is central to fostering trust and providing financial advice to compliment other digital channels.

Banks are grappling with the future of physical branch locations, but to bridge the gap between in-person and digital, they are beginning to make moves towards utilising a mobile advisor workforce, which can be managed through a mobile app. Connecting roaming advisers to nearby customers, when and where they are needed, eliminates the costly outlay of a bank branch and gives customers the level of service they desire.

With the support of automation, staff are becoming more empowered to resolve complex issues, which in turn means that branches will not just sustain the banking experience for customers but will manage to revive it. One national UK bank used technology to reduce complaints by 25 percent and customer churn by 12 percent, by using data analytics to recognise customer needs in advance and resolve issues faster.

We are in a time of significant change, with challenger banks and specialist lenders increasing their gross lending and market share, and traditional providers seeing their share stagnate. However, it is not game over for banks – they have an established customer base to leverage and can use the opportunity to create a harmonious balance between the different channels available, to accommodate all customers to strive for success in the new banking landscape.

Parker FitzgeraldParker FitzgeraldJanuary 26, 2018


Earlier this month, new regulations in retail banking and payments across the EU came into force, allowing thousands of companies that aren’t banks to gain access to financial data and payment accounts.

Many experts are predicting a digital revolution in banking, so what is changing? How quickly will it happen? And what does that really mean for consumers?

In essence, banks and other organisations such as Google, Amazon, and Facebook will provide new and innovative financial products and services. By 2020 we expect the digital transformation in banking to be in full flight, meaning consumer banking will fundamentally change.

Incumbent banks will be competing with thousands of other companies from across Europe. The large technology companies are likely to offer new ways to pay and we are already seeing new services emerge from the likes of Google. The path is also clear for much smaller, niche providers to move into consumer banking, as the regulation allows new entrants to interrogate financial data, move money and manage finances on behalf of consumers.

Whilst these new players must meet new regulations, including increased security and regulatory reporting, they won’t have the same level of regulatory scrutiny as banks.

Of course, the introduction of new regulations and the ensuing market disruption will bring with it some adverse consequences.

The risks and impacts associated with this regulatory change remain unclear. The responsibility for operational resilience, which has been at the heart of banking payment systems for generations, will be dispersed across thousands of organisations.

Large online retailers are likely to encourage customers to use online payments instead of cards to reduce their costs. If that happens, banks will see online payment volumes increase, potentially putting a strain on critical payment infrastructure.

There are also concerns across the banking community about their customers’ data security. Criminals could look to capitalise on the new open banking ecosystem to misappropriate funds and steal sensitive financial data.

All of this means that there is likely to be a period of operational instability as banks learn to manage increasingly large and unpredictable volumes, and protect their customers from new types of cyber-attack.

In summary, the new regulations mean many consumers will enjoy the benefits of new, exciting digital products and services. However, in 2018 it will be more important than ever for industry and consumers to be vigilant, by protecting their online bank account login information and personal financial data from cybercrime and fraud.

Joe GallagherJoe GallagherJanuary 24, 2018


All banks should be aware of the importance of catering to the needs of the millennial generation, and while many are, there are significant misunderstandings around how to address these new consumers.

This tech-savvy cohort is set to dictate the direction of the banking industry, making up 21 percent of the UK population and representing a significant business opportunity for interested banks. But developing a clear idea of what a certain group of customers wants, and then coming up with strategies to meet these expectations, is by no means an easy task. It requires banks to develop a strong understanding of what motivates and matters to their customers.

After a decade of rapid technological change, and new directives like the Second Payment Services Directive (PSD2), banks need to take a step back and consider exactly what it is that millennials want and expect from their financial services. Recent research by NCR shows, that adopting the latest technology should be an important concern for banks, to which 93 percent of respondents agreed or strongly agreed.

But banks also need to keep an eye out for future trends as innovation is an expectation that 91 percent of respondents have of banks.

Millennials have lived through a huge shift in attitudes towards banks – having grown up through the 2007 financial crisis. According to the Millennial Disruption Index, 71 percent of US millennials would rather go to the dentist than listen to what banks are saying.

With the increasing prevalence of digital devices in every aspect of our lives, current prevailing thought is that many members of the millennial generation are happy to take a ‘hands-off’ approach to their finances, but want their bank to be ready to provide help and advice when they need it.

The NCR survey revealed that 90 percent of the survey participants aged 18 to 25 would be happy if their bank offered loyalty programs and reward schemes in partnership with retailers. Seventy percent would appreciate recommendations from their financial institution based on a combination of their banking history and ‘customers like me’ analysis.

What matters to millennials when it comes to banking?

When it comes to delivering a certain standard of service and customer experience, it is important that banks have the strongest possible understanding of what matters to certain demographics and how to reflect these concerns.

As far as millennials are concerned, it has been claimed that members of this generation would prefer not to micro-manage their money on a day-to-day basis. Instead, millennials are looking for innovative products and services that will help them to prepare for the challenges of cash flow, budgeting and savings with targeted and appropriate support and advice.

This is where the opportunity for banks emerges; with a customer base who are driven by experiences rather than materialism (according to a survey by Eventbrite), banks stand to gain by offering the right sorts of streamlined services for millennial customers targeted at the real problems that these customers are facing – be that saving for holidays or managing their Uber expenditure.

Successfully doing this will be integral for banks looking to build successful, enduring relationships with their millennial customers, and sweep away any cobwebs of distrust that may still linger.

Are you missing the millennial opportunity?

Banks that fall into the trap of prioritising sales and revenue generation through traditional models that proved successful with Baby Boomers or Generation X, run the risk of missing out on valuable opportunities to earn long-term consumer trust and loyalty. Instead, banks need to allocate focus to goals that are harder to quantify but could prove just as significant in the long term – such as customer experience and expectations – to drive a new generation of revenue as millennials become an even-larger segment of the consumer base.

The November 2016 issue of the Digital Banking Report, sub-titled The Millennial Mind, argued that millennials represent a “tremendous upside opportunity” for banks, but this generation reports the most problems with financial services and is the least likely of all age groups to have their problems resolved. Report author Jim Marous noted:

Millennials are the generation least likely to strongly agree that their bank knows them, looks out for them or rewards them. While partially caused by being a more demanding segment, they are also the most ignored by the industry.”

In our current era of increasing diversity and competition in the retail banking industry, it has never been more important for banks to make a special effort to engage with their customers, to find out what matters to them and to invest in delivering on those findings.

Using all of your consumer-facing touchpoints and channels of communication to build meaningful engagement with millennials could be vital to the development of long-term, mutually beneficial relationships with this key demographic.

Martin HäringMartin HäringJanuary 15, 2018


Today’s customers are expecting more than ever from their favourite brands. With a proliferation of tech-savvy companies tuned into the digital economy, customers can have on-demand access to food, transport, and endless personalised services at the touch of a button. Why shouldn’t this be the case for their bank services too?

A recent survey conducted in the UK highlighted that incumbent banks still have a long way to go before they meet their customers’ expectations.

Further research shows that mobile and online banking are now gathering significant pace, with more than a third (38 percent) of consumers carrying out their banking via a mobile app on a regular basis, rising to 53 percent for the 18 to 34-year-old bracket.

Mobile banking 1.0 brought simple banking transactions to our fingertips. But banks can’t rest on their laurels – the death of the simple mobile banking app is not far away.

Customers are now expecting a much more joined-up, customer-centric approach. Step-in mobile banking 2.0 – the future personal finance management tool giving a single view of a customer’s finances, including bank account, student loan, credit card balance, mortgage applications, and more.

Changes to competition in the banking industry come into play this month, such as the move to open banking and the second Payment Services Directive (PSD2). These are set to drastically shake up how a bank interacts with its customers. So how can banks maintain mobile leadership and what should bank CMOs be doing to provide customers with more streamlined services?

The customer-centric bank

It can be easy for banks to lose track of what is most important to customers, and organise their business to focus on functions and product lines. This product-led mantra leads to a siloed approach to business growth, and neglects customer satisfaction.

When customers ‘feel’ a purely transactional relationship with their bank, it can be difficult for them to build a significant amount of trust. This means important customer relationships risk being resigned to the short-term.

It is the bank CMO’s responsibility to champion their customers’ needs, bringing these to the board and shaping business strategy to fulfil expectations. In this respect, the role of the CMO is gradually changing into that of a ‘Chief Customer Officer’ (CCO) with scope to foster a more customer-led culture, and an ethos around creating customers for life.

AI-driven experience

In the future, customers setting up a current account and accessing mobile banking applications may see integrated AI chatbots guide them through the process – with the chatbot asking them a few questions and requesting verification, such as a passport or identity card.

With this type of automation, account set-up time can be reduced to a matter of minutes. Customers can also have immediate access to their account, tailored to their preferences, with the bank fulfilling vital KYC (know your customer) and AML (anti money-laundering) requirements.

With the use of AI, banks can become more attuned to their customers’ needs and offer highly efficient processes. Optimisation of onboarding processes such as these, that previously would have taken multiple days, will also give vital time back to staff to deal with more strategic activities.

Artificial intelligence and machine learning technologies are not only enhancing processes such as customer onboarding, but are also helping to improve different aspects of customer interaction to improve the overall Customer Experience.

Banks today can receive hundreds of FAQs and enquiries through their call centres every day. By using AI-enabled chatbots to automate responses, customers could receive answers to their queries in a matter of minutes – and again, bank staff can be freed up to deal with more pressing issues. But banks mustn’t lose the human touch altogether. By giving the opportunity to connect with an agent via video link, customers can be assured there is always the option to speak to a human if required or preferred.

The power of data

Customers, along with data about their transactions, are the most valuable assets a bank possesses. With AI now helping to bring new-found data insights and analytics capabilities, bank CMOs can harness the power of this data – using it to serve up personalised services and recommendations to customers.

The simple mobile app alone is giving banks a window into customers’ accounts and needs. Customers using a mobile banking app will give their bank access to data such as their location, transaction history, salary, mortgage rates, holiday budgets, spending habits, and more.

With PSD2 coming into effect this month, this proliferation of data will only continue, as consumers begin to grant trusted third parties access to their banking data through open application program interfaces (APIs). Bank CMOs should be capitalising on this opportunity and connecting the dots between their customers’ transactional data, personal data, and social media data. Powerful AI algorithms can then identify when these customers will be most receptive to a service, allowing banks to provide unique products personalized to their needs.

The role of the CMO is changing

To build true customer-centricity in the long-term, the mindset of the modern-day bank needs to change. The CMO must act as the navigator on this journey, taking the leading role and highlighting the benefits of cognitive technologies such as AI to the Board.

In five years, the traditional role of the CMO certainly might not exist in the same guise as it does today. I predict the CMO’s role changing into that of a Chief Data Officer or Chief Customer Officer – someone who dives into advanced data analytics and prioritises the needs of the customer.

The customer is continuing to shape the way we interact with our banks in every way. Banks that fail to deliver true customer centricity in this fast-approaching competitive world, driven by open banking, surely won’t survive for very long.


Paul AinsworthPaul AinsworthJanuary 12, 2018


Open Banking should be a “catalyst for greater Customer Experience” rather than a hindrance for the UK’s banks, it has been suggested as one of the biggest personal financial shake-ups in recent years gets underway.

From January 13, customers are able to share their personal financial information with firms other than their bank, with the aim of allowing them to seek better deals on mortgages, overdrafts, and other services.

The changes are being overseen by the Open Banking Implementation Entity (‘OBIE’), which was established by the UK’s nine largest banks following an investigation into banking by the Competition and Markets Authority in 2016.

Despite the clear advantages of the reforms – that are designed to modernise banking and ease the grip on the market held by older, larger banks – concerns remain, even among customers, about the risk to data privacy.

But by putting personal financial data back into the hands of customers, many agree that open banking has huge potential for customers.
As for the banks themselves, the changes should not be viewed as a threat, but as a chance to boost Customer Experience and grow the number of people using them to manage their finances.

This view is posited by Andrew Stevens, Global Banking Specialist at CX solutions firm Quadient.

“Looking at the open banking revolution in one way, it can represent a real threat,” he told CXM.
“However, it shouldn’t be seen as a negative development. Banks should see this as an opportunity for change e.g. as the spur for providing great customer communication. Banks need to engage and have a conversation with customers on their terms; providing the right message, at the right time, over the right channel.”

Nine UK banks must comply with the new banking rules, which will be fully implemented by March. They are: Lloyds, Santander, Bank of Ireland, Barclays, HSBC, RBS, Danske Bank, AIBG, and Nationwide.

Explaining how banks should progress in the Open Banking era, Andrew Stevens added:

“There are three steps that banks should follow to set themselves up for successful conversation with customers: avoid reinventing the wheel by taking stock of the communication tools they already have in place, break down barriers between channels and departments, and finally make sure that there are no hitches when new communication methods are implemented.”

“It would be easy to see the new measures as time of hardship. Instead, banks should it as a catalyst for greater Customer Experience.”

Meanwhile, the reforms could potentially place the UK at the forefront of international banking, according to Obie Trustee Imran Gulamhuseinwala.

“The work we are doing here is genuinely world-leading,” he explained.
“The UK is the first nation to implement a standardised Open Banking solution. In the UK we are creating a single technology standard enabling new services to be easily built and offered to consumers and small businesses. Open Banking will help make Britain one of the best places in the world to bank and will, in time, stimulate the digital economy.
“While the UK is leading the way, we are incredibly excited at the opportunities created by working with peers around the world, and in Europe in particular. We are in active discussions with several groups seeking to build standards and we look forward to that work bearing fruit in 2018.”

Christopher BrooksChristopher BrooksJanuary 4, 2018


Leading Customer Experience Consultant Christopher Brooks discusses CX matters with Scott Fleming, the Chief Customer and Commercial Officer with the Bank of Cyprus UK…


Scott, thanks very much for agreeing to meet up and share with readers the value and role Customer Experience is playing for the Bank of Cyprus UK. The crossover of commercial and customer in your role must give you a great perspective on creating ‘value’, but first, for those less familiar, perhaps you wouldn’t mind starting by sharing an introduction to the business.

Scott:  The bank’s been operating in the UK since 1955. Originally it was a branch of a parent company, but now it’s a regulated company in its own right, authorised by the PRA and regulated by the FCA and PRA.

The business has evolved over time from its origin of being there to service the Cypriot community in the UK. Today we offer a range of deposit products and banking services for both the retail and business markets. We have developed a deep expertise in business lending, such as professional Buy-To-Let and Property Development Financing, and we have recently extended our range of products to include residential mortgages.

We are recognised by property entrepreneurs, business owners and retail customers as a challenging alternative. Our mission is for our customers, communities, and our people to prosper.

We are a business based on the strength of our people. Our people are key, not only because of our community-based heritage, but because they make our service stand out and differentiate the bank. Relationships are integral to what we do.

Do your customers typically have an association with Cyprus? And how, if at all, does that impact their banking Customer Experience expectations?

Scott: A significant proportion of our customers do have some connection to Cyprus, which is unsurprising because of our history – it’s where we’ve come from. We also have a significant number of Cypriot residents who hold an account with us. The link to Cyprus continues to be important to us.

For example, we help meet the needs of Cypriot students coming to study in the UK, by allowing them to set up accounts prior to relocating here, which makes for a smooth arrival in the UK and start to their studies.

However, today we find ourselves extending way beyond this. We have a growing number of customers who have no connection to Cyprus. In addition, we are extending our coverage throughout the UK. We have opened several offices throughout the UK to support our business growth.

In addition to London and Birmingham, we now also operate in Leeds, Manchester, Bristol and Brighton; and these locations were chosen for their proximity to businesses that would benefit from our offering.

We’ve started from a community, but we have grown, due to the quality of our service. Our customers have the same expectations of their bank as anyone else, and our purpose, first and foremost, is to fulfil our customers’ needs and help them realise their ambitions.

Having had the pleasure of meeting your Chief Executive Nick Fahy a couple of years ago, I know he is very committed to adding customer value through Customer Experience. How important would you say it is to have backing from the very top?

Scott: Absolutely critical. No one else in the business will take customer value seriously if it doesn’t come from the CEO and his top team. For example, the first item the senior team discusses at every meeting is the customer. It’s always the first topic on the agenda and permeates through other agenda items such as sales, regulatory changes and competitive/economic landscape.

Having worked at several retail banks, I haven’t seen that anywhere else.

That makes a strong point to the rest of the company. According to research by Prof Dr Phil Klaus, companies can be classed as Preservers, Tranformers, and Vanguards, according to their commitment to and proficiency in Customer Experience. With those at the top end maximising the ROI from CX. Where would you say you are against that scale?

Scott: I’d say our ambition is to be a Vanguard. We are beyond what I’ve seen at other companies. We don’t just focus on fixing what’s broken.

We are more than preservers, I would say we are a Tranformer because it applies to everything we do. Whether developing propositions, improving processes, optimising customer journeys, or other essentials, we are always looking to improve the experience for our customers.

For us CX is not a project, and it can’t be seen as just that. ‘Customer first’ is one of our five cultural values of the business. It impacts everything from our induction process, through to the business strategy, development plans, roles, and responsibilities.

At UK board level, the customer agenda is presented on a quarterly basis. We provide updates on our progress and our KPIs in CX which are our regular NPS and Effort <CES> scores to show how we are progressing. We also have additional metrics, but these two are key board views of Customer Experience performance.

We share what’s been delivered and what’s planned in the in next quarter with the board. They will challenge our plans to make sure we are ambitious enough. However, they will also make sure we operate at the right pace so we don’t over promise. By doing so they are safeguarding the bank’s reputation.

You’ve been in your role for 18 months. In your time, how has Customer Experience moved forward?

Scott: The set-up of our Voice of The Customer programme happened just as I arrived. This programme delivers a benchmark for measuring customer experience.

Using the programme, we’ve been able to build our understanding of what drives key metrics such as NPS and CES. We’ve built other KPIs which, along with these two, are now tracked, reported and action plans are set each month for every function in the business. Our people care about hitting, and exceeding, targets because they know it means customers are happy with us.

There is a great ethos in the company – the customer is always central to what we do. We run customer forums with employees from all business functions. We look at the anecdotal feedback we receive from customers, not just complaints but mentions of inconvenience, as this is an early indication of where we can improve.

As a retail banking company, how are you finding the arrival of new ‘Internet of Things’ technology and the adoption of self-serving customers?

Scott: We will achieve our vision because of our people. It’s about our people, being supported by appropriate technology. If we can use technology to make doing business with us easier for customers we consider it. But we are careful how we develop things. More important is the employee engagement aspect. We need our employees to understand how technology helps our customers to bank with us.

As we extend our reach with our small business proposition, we will be evolving our digital support accordingly. As customers come on board through pure digital channels they will have different expectations of the experience we provide. We must adapt to that as well.

How do you keep the customer-first agenda alive within the organisation? What tools are you using to keep customer insight fresh and optimised for decision making?

Scott: ‘Customer-first’ has been a valuable focus for the last 18 months. It’s embedded from induction, but we also have regular awards for teams, for individual, for doing the right thing, for being your best etc. It’s important to have the customer embedded into celebrating success because it engages and motivates people.

We also run staff forums and surveys to gather suggestions on how we can do more for customers. We have very good VoC feedback rates, but staff hear things that aren’t always captured in VoC feedback, so we operate multiple means of feedback.

Being transparent about our customer experience performance is important, so we communicate directly with our customers on improvements we’ve made as a direct result of their feedback. We’re also developing a new set of ‘customer promises’ which we hope to launch soon, but these must be meaningful to our customers.

In addition to our relationship NPS measurement we’ve chosen to focus on Customer Effort rather than a transactional NPS. We feel it’s more meaningful to get a read on how hard or easy it is to do something with us.

In retail banking it’s often the ‘stress’ and ‘anxiety’ points of pain for customers when your CX must work its hardest. Is that fair or do you have positive moments where the Customer Experience can shine through?

Scott: I’d have to agree. Customers just want their bank to work the way they expect it to. Customer Experience is mainly focussed on reducing anxiety and stress points which can occur in customer journeys. We are building our taxonomy to better understand context and sentiment as well.

Customers want us to take care of issues. They expect us to take action when it goes wrong for them. You need to make contact as easy as possible whilst ensuring good security. You make a real difference when you make the customer experience simple.

Reflecting on the year behind us, are you where you want to be with your CX strategy?

Scott: Yes, we are very pleased. There are many regulatory changes occurring within financial services, particularly with the arrival of PDS2, GDPR, etc. All these initiatives directly impact Customer Experience. It is essential that we keep the Customer Experience in mind as we incorporate and adapt to new regulations. Ultimately, these regulatory changes are opportunities for improving the Customer Experience.

This highlights how far you’ve come with Customer Experience to be considering customers along with tech advancement and compliance adherence. Do you see Employee Experience as an essential part of this as well?

Scott: Yes, Employee Experience goes hand-in-hand with Customer Experience. We are always trying to improve on our Employee Experience and we are looking at how we improve team working across business units and work more closely together.

We are creating an internal service culture – serving one another. Which includes looking to embed awards and remuneration to make CX more than a number. With an effective employee engagement model in place, employees can do even more for our customers.

As you are making progress with Customer Experience, who do you look to for inspiration?

Scott: We obviously keep an eye on our direct competitors, whether they are dealing with business or retail customers or both. We are all striving to differentiate ourselves from the big banks by providing a better Customer Experience.

Beyond this we share great stories throughout the business based on personal experiences about the differences people can make in almost any industry. We care about our people so it’s important to find and share good evidence of CX that reinforce the importance of personal service.

As CX matures at the Bank, what will become the most important focus?

Scott: It is then about keeping it alive. When you’ve made the important changes, it’s a marginal gain business. I liken it to Dave BrailSford’s approach with the Team Sky cycling team – get the fundamentals right and then look for  one percent improvements in areas that are being overlooked by others. The cumulative effect of small gains will add up to a remarkable improvement.

If we can ensure we have good levels of interaction, and keep delivering small and meaningful changes to delight our customers, we will be a success. This will also make sure our employees are engaged and enthusiastic. It’s important not to have CX tucked away as another function. It has to be embedded across the business in order to sustain CX and succeed.

Finally, if you had the chance to go back and tell yourself one piece of advice when it comes to driving CX forward, what would that wisdom have been?

Scott: I would say gather even better quality data on customers, much more beyond the transactional level normally associated with banks. For instance, enhancing your data with social media sentiments relating to what matters most in customers’ lives, away from their transactions and interactions with us. All you are trying to really do is understand what your customer expects from you and how you can exceed those expectations.

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Customer Experience Magazine is the online magazine packed full of industry news, blogs, features, reports, case studies, video bites and international stories all focusing on customer experience.



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