I recently met one of my dear friends, a senior leader at a leading financial institution (FI). With great coffee, we had a really good conversation. While talking, he mentioned how difficult it is getting for financial institutions to gain customer loyalty. This got me thinking that most financial institutions are facing the same challenge, given the changing market dynamics. But what can they really do about it?
Today, most FIs strive to: attract new customers, provide unparalleled service, and build long-term partnerships that can result in years of repeat business. However, getting there requires more than just aspirations and good intentions — you need to pay attention to the end-to-end lifecycle of your corporate customers. By meeting and exceeding expectations at every phase of the customer’s lifecycle, you can turn prospects into satisfied customers and the ‘biggest fans’ of your brand.
Breaking Down the Customer Lifecycle
Getting hold of the customer lifecycle is an essential part of any business. It subsumes the entire customer journey where prospects learn about a service, subscribe to it after due consideration, and do it repeatedly as they finally become loyal customers.
So, it can be said that a typical customer lifecycle consists of five stages, namely—
It Doesn’t End with Customer Acquisition
For a long time, financial institutions mainly acted towards strengthening their performance till the first three stages, focusing on customer acquisition. However, a crucial point is often missed—your job doesn’t end here. The real business value is hidden behind customer retention and loyalty.
According to a study, it costs five to 25 times more to attract a new customer than to retain an existing one. To ensure sustainable business growth and future-proof, you must focus on growing your customer base and getting repeat business by making customers stick for a long time. By focusing on the end-to-end customer lifecycle, from reach to retention and loyalty—you can build solid and long-term relationships with your customers and make them the biggest advocate of your business.
This approach will translate into a stronger customer base, more business, and greater brand value.
Why Revamp Customer Lifecycle Management?
Transforming the end-to-end customer lifecycle is a must if you’re looking to make your customers stick, but this cannot be made possible without taking a fresh look at your customer lifecycle management process.
Here is why revamping customer lifecycle management should be your top priority:
- Better Digital Onboarding: Customer onboarding is a make-or-break step for financial institutions and is increasingly shifting to digital channels. However, a study suggests that 63% of customers abandoned their banks during the digital onboarding process before completion. Customer onboarding is a complex process that can be costly without adequate automation. You must ensure a smooth digital onboarding process that reduces the onboarding time while addressing challenges like lack of transparency, siloed operations, and compliance.
- Superior Customer Experience: As a financial institution, you continue to face tremendous pressure to evolve and enhance your customer experience. And to be able to deliver a superior experience, there is no better time for you to shift from managing multiple disparate and manual processes towards handling more global, holistic, end-to-end automated processes.
- Efficient Processes: A disconnected manual system not only causes low customer satisfaction but also leads to delayed revenue generation, high costs, communication silos, and poor agility. These inefficiencies can result in a significant impact on customer experience.
All these points present a strong case for you to consider transforming your customer lifecycle management.
I will be writing another blog that will talk about how financial institutions like yours can streamline customer lifecycle management and turn customers into your biggest fans. Meanwhile, I will share this piece of information with my friend as well.