Consumer Communication Expectations Rising

With the temperatures rising, so too are customers’ communication demands from their service providers — including their banks.

“Consumers are more sophisticated in how they communicate with their financial institutions,” David McCann, Varolii Corp.’s new president and chief executive, tells Bank Innovation.

And because of consumers’ demands for better communication increasing, financial institutions are trying to step up their efforts and soothe those cries to keep their customers, rather than alienate them.

“It’s an increasingly message-centric world where banks are striving to [improve] communication with customers even as they are suffering regulation from the government,” says McCann, whose company is a provider of proactive communication. “Every bank is trying to innovate. Banks are rethinking what they are doing.”

That means better targeting how they communicate to particular consumers. McCann explains that institutions used to “blast” communications to their entire databases, but now, consumers are requiring them to create more personalized communication experiences, which is an area that Varolii’s technology hopes to tackle.

“We need to work with the banks to see how to better segment the customers,” he says. On his near-term roadmap is to improve the technology provider’s personalization capabilities.

“Varolii will continue to enrich the design profiling around consumers’ preferences,” he says, defining consumer preferences as when and what channel they prefer to connect with their banks.

Better personalization leads the priority list because the “nirvana” of marketeering is finding out consumers’ preferences. “Understanding customer preferences is the secret to profitability,” he says. “[Banks] have to be more sophisticated in how consumers share preferences with whom they buy services.”

COMMUNICATION RADAR

Referencing social media channel communications, McCann believes it’s still early days for the industry, in part, because of lingering privacy concerns.

“I don’t think social media has a big role to play yet in financial institutions,” he says.

However, the smartphone is already changing the communication relationship because “now you get into the power issue. Smartphones empower the consumer,” he says. “The iPhone lets you use the apps you want. …Over time, the smartphone will change the dialog.”

He reveals that Varolii is investing in the smartphone’s role in the customer and financial institution relationship.

Banks, for one, have already alerted Bank Innovation that their mobile banking customers tend to also be their most actively engaged customers.

When SunTrust Banks Inc. conducted a mobile analysis study about a year ago, one clear trend surfaced: Those customers who chose to do banking through their mobile devices were also the same customers that transacted most often across all channels, Ginger Schmeltzer, senior vice president of digital channel management at SunTrust, told Bank Innovation.