3. Help customers achieve bigger goals
Banks that consistently outperform the market take a strategic approach to meeting customer expectations. They identify a target customer segment and work systematically to understand this segment to develop and market relevant products, allocate investments in capital, ensure management focus, maximize share of wallet, and guide virtually every other significant decision.
Banks must shift from the traditional “product-push” approach to one focused on helping customers achieve their wider ambitions. For consumer banks, this may mean helping customers prepare for big life events, such as weddings or retirement, building their financial skills or achieving major goals such as buying a home.
One bank in Tennessee has decided to target customers in a clearly defined set of communities. By focusing on meeting the needs of this specific group, the bank has lifted ROE above the cost of equity.
For banks serving SMEs, it’s time to go beyond the “brilliant basics” and add more value by:
- Connecting clients to an ecosystem of suppliers and distributors
- Providing data-driven insights on customers, products and regions that support growth
- Supporting productivity with a range of services, including human resources (HR), talent, tax and regulatory compliance provided by bank partners
- Navigating larger commercial customers through increased business risk and helping them enhance performance in a weak market
Banks with corporate customers can also reap the benefits of a targeted approach. A high-performing bank in the Philippines focuses on serving just a few industries, including transportation, using its deep knowledge of these sectors to offer clients relevant services across all aspects of the business.
Building on trust to improve experiences
Changing expectations and increased competition make it even more challenging for banks to remain relevant to customers. But, high-performing organizations know that creating a customer-focused culture is critical to lifting profitability in tough conditions and allowing investment in the digital transformation programs that will drive long-term value. Building true customer centricity does not happen overnight, but banks can begin now by building on the latent trust of existing customers, improving their experience and taking a strategic approach to meeting wider expectations.