This article was originally written by Avanade alum Michelle Baxter.

The need for emotional connection

These are turbulent times. Customers really need their banks to show some support and empathy. They need that personal touch. I’m often baffled why banks don’t do more with my personal information. Why should my bank know less about me than my rideshare firm or my food delivery application? Shouldn’t banks be doing better than simply selling me products? Shouldn’t banks be helping me make better financial decisions? Isn’t that what matters?

It feels to me that in the drive to become digital, banks may have improved process and lowered cost. But they’ve created transactions lacking in emotion and lost that connection with the customer. There’s a need to balance human interaction with digital transaction.

Fintechs have simpler portfolios and were born in the cloud, which means they can focus on better customer experiences. Traditional banks have more complex portfolios and systems, which limits what they can do – especially their frontline staff. But if they can unleash their people’s expertise and give them the collaboration tools they need to engage much more effectively with customers – effectively balance the human and the digital – the opportunities are significant.

Gartner found that customers who use a mix of digital and human channels have a much higher revenue potential than those using only digital. They also found that customers will return to branches post-pandemic. Surprisingly, the youngest consumer demographic in this study was the least likely to select a digital-first engagement with their financial institution. Accenture research concurs: “Digital on its own seldom differentiates the bank, makes the customer feel special or builds authentic relationships.”

Balance between human and digital is the basis for differentiation To put humanity back into banking there are four key principles we have found essential:

• Put context back into every conversation: Surprise customers by showing what you’ve learnt from them. Ask more focused, smarter questions as a result. Customers will feel like they are being listened to, not part of some random conversation.
• Truly meet customers where they are: Understand the particular situation your customers find themselves in. They may be struggling to pay a mortgage. They may be overdrawn after years of being solvent. Imagine how that feels - and demonstrate empathy.
• Predict customer intent – and act on it: Listen to what your customers are saying. Hear their ambitions and challenges. Find out about their goals. Leverage data from similar customers to predict what might be next.
• Build experiences that feel personal: Make the most of data given to you by your customers. Use it to build confidence and trust. If you know a customer’s purchasing history or family situation, tailor the conversation accordingly. Most customers will appreciate it. Being truly human in your banking interactions is the basis of real differentiation and the way to grow wallet share. The promise is deeper customer engagement and higher revenue per customer, while operating at substantially lower costs, closer to that of the fintechs and neobanks. Striking a balance between human and digital engagement drives retention, relationships – and revenue.