Customer Experience Matters

Let’s face it, large banks aren’t generally easy to do business with. In a recent Forrester Research report called “Consumers Don’t Enjoy Financial Services,”I examined survey responses from about 5,000 consumers who told us what they thought about their bank. Here are some tidbits from that research:

• 35% of consumers fall into a segment that we call “at-risk” because of their low level of enjoyment with their bank. Compared to other segments these ”at-risk” consumers are the youngest and have the highest income.
• Young females (Gen X and Gen Y) report the most problems with their banks

Banks know they have a problem. In a previous post called “Banks Prepare For Customer Experience Wars” I discussed a survey of banking execs that I did with American Banker. In that survey we found that:

• 97% of banking execs think that customer experience is very important or critical
• Most say that they aren’t meeting customers’ needs - especially online, where less than one-third of respondents gave their bank’s interactions a vote of confidence.

Hmmmmm. Doesn’t take a PhD to figure out that banks have a customer experience problem — especially with younger consumers.

Given that Gen Yers are really a different beast from older consumers (take a look at my presentation on Gen Yers within this post: A View Of Forrester’s Consumer Forum October), banks will need to focus explicitly on this younger segment.

The bottom line: FWIW, IMO b8nks need better Gen Y strats. HTH

Well, this will be a busy week. Forrester’s Consumer Forum called “Winning In A World Transformed By Social Technologies“ is happening on Thursday and Friday in Chicago. I think we’re expecting nearly 800 attendees. Here’s a blurb from the marketing literature:

Fueled by cheap devices and pervasive access, individuals are increasingly taking cues from one another rather than from institutions - a phenomenon that creates chaos for traditional brands, sellers, and media outlets.

It should be a great event. The industry speakers include Christie Hefner, Chairman and CEO, Playboy Enterprises; Christina Norman, President, MTV Networks; Robert J. Bach, President, Entertainment & Devices Division, Microsoft; and Richard Edelman, President and CEO, Edelman.

I’ve been responsible for creating a track called “Designing Great Social Experiences” and am really excited about the five sessions in the track:

• Designing Experiences For Young Consumers; led by Ross Popoff-Walker and me. We’ll be showcasing early results from research that we’ve been doing on how firms should design experiences for Gen Yers (18-27 year-olds). We’ll layout 10 characteristics of Gen Yers that firms should keep in mind when they’re designing experiences for these young consumers. And then we’ll provide 4 categories of design strategies to apply.
• Designing Mobile Social Networks, led by Vidya Lakshmipathy. Vidya will also be showcasing some new research on the ways that mobile can be used to enhance social networks. She’ll also be leading a discussion with execs at firms that have innovative mobile applications: Socialite and Urban Interactive.
• Customer Review Design Best Practices, led by Megan Burns. Amazon and NetFlix have successfully used customer reviews to help other people make good choices; and many firms are following their lead. In another presentation of brand new research, Megan will disect the key elements of a customer review and then show attendees how to use this information to build a robust customer review system.
• Blog Design Best Practices, led by Harley Manning. Harley will showcase Forrester’s Blog Review metholodology. Anyone that’s seen Harley speak in the past knows that this will be an action-packed session. (Forrester clients can access to this methodology, as well as others, by clicking this link: Forrester’s CxP methodologies).
• Social Computing Trends: An Interactive Agency Roundtable, led by Kerry Bodine. Kerry will discuss trends in social computing with execs from an exciting group of design agencies: Avenue A | Razorfish, VML, and Organic.

Many of the sessions are showcasing brand new research, so it should be a really interesting event!

I’ll write-up some highlights from the event in my blog: Stay tuned.

You may also want to check out the blog by two Forrester analysts — Josh Bernoff and Charlene Li — called “Groundswell: Winning In A World Transformed By Social Technologies.” Josh and Charlene are the keynote speakers at the event and they’re writing a book called Groundswell.

The bottom line: Chicago should be hopping this week.

In a recently published research report called Service Trumps Price As Consumers Get Older, we examined what consumers care about most when shopping or doing business with financial services firms, insurers, and retailers. The analysis of nearly 5,000 consumers looked at data across five generations: Gen Y (20s), Gen X (30s), Younger Boomers (40s), Older Boomers (50s), and Seniors (60s+).  Some common things showed up in all three sectors:

• Younger consumers focus on low prices. For all three sectors, Gen Y was the group that cared about low prices more than every other generation. This focus on price dropped considerably with progressively older generations.
• Older consumers want good service. When it comes to financial services and insurance, Seniors care the most about good service. And while good service isn’t the top concern for Seniors when they deal with a retailer, it is clearly one of the more important attributes. The need for good service declines with progressivley younger generations. 

The bottom line: To reach older consumers, make sure that your marketing messages (and offerings) convey (and provide) good service.

In a recent comment to my posting on NetPromoter vs. Satisfaction (which is a topic that often evolves into almost a religious debate), someone mentioned generational differences in how consumers interact (younger consumers are more likely to “recommend” than are older consumers). A lot of my research deals with consumer behavior — looking at topics like this — so I thought it might be good to include some elements of my research in that area on this blog. Rather than dealing with the “recommend” topic (we’ll let that discussion continue in the comments), I’ll dig into some of the differences in “Enjoyability.”

In a Forrester report called “Gen X Males Crave More Enjoyment” I analyzed survey responses from more than 5,000 consumers — examining how they enjoy doing business with 14 different types of companies. There’s a lot of data in that report, but let me highlight a few key findings:

• Male Gen Xers want a lot more enjoyment. When it comes to every category of business except airlines, Gen X males were at or near the top in their willingness to switch providers for a more enjoyable experience.
• Seniors aren’t looking for more enjoyment. Female Seniors was one of the groups least likely to leave its current provider for a better experience - except when it came to the group’s dealings with general department stores. Male Seniors felt the same disinterest in moving business away from six of the different types of companies.
• Female Gen Yers have more enjoyment than their male peers. Young consumers are split down gender lines when it comes to enjoyability. Gen Y males give some of the lowest marks to seven firms while Gen Y females give some of the highest marks to four of the firms.

There are significant differences in both generations and genders (we sometimes refer to this analysis as a look at “genderations” – a shout out to Eric Dolan, a researcher at Forrester, for creating that term). So your strategy had better be clear on what you want to accomplish with each of these genderations.