A well-known market intelligence company, Infiniti Research, has announced the completion of its latest article – winning in the German retail banking battleground with customer experience strategy.
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This blog provides comprehensive insights on:
- An overview of the German retail banking sector
- Common pitfalls that retail banking companies encounter in CX
The German retail banking sector faced a rough ride during the financial crisis. While some banks almost drove off the road, others managed to stay on track, allowing them to overtake their competitors. However, the road ahead remains unclear for German retail banking companies. Innovative trends are shaping new traffic patterns, putting additional pressure on all types of banks, even those that are in decent shape today. The next five years will be crucial for the German retail banking sector to decide which turn to take to avoid a dead end. The German banking market has a unique three-pillar structure of private, savings, and cooperative banks. This distinguishes it substantially from banking sector companies elsewhere. German banking is also characterized by its strong dependency on net interest income, an extensive branch network, and a prudent risk profile. The long-term profitability is of German retail banking companies are low compared to global peer markets, and German banks have difficulty earning their cost of capital due to factors including high competition, low prices, and lack of focus on customer experience.
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Here are some ways to avoid missteps and set your customer experience strategy up for success:
Focusing on isolated touchpoints
Customer experience is often misunderstood as customer pain points that needs to be addressed. While these efforts are certainly vital to improve the overall customer experience, focusing only on these factors leads companies in the retail banking sector missing out on the root cause of these pinpoints. Furthermore, simplistic solutions that have been merely copies from competitors could sometimes prove to be misleading. Customers who rate single points of contact as satisfactory often tend to rate the whole journey as a negative experience. In such cases, these customers are less likely to become the engaged, valuable customers that banks strive for.
Ignoring key customer journeys
Once banks in the German retail sector have realigned their thinking toward holistic customer journeys, the next step is to map their customer journeys and figure out which ones are most critical to business. This includes taking into consideration factors such as the areas of improvement, factors that could have an impact on brand image, and other value considerations. For improving critical journeys, banks should determine what degree of improvement will make the most economic sense and generate the most value. German Retail banking sector companies must arrive at a decision on how much needs to be invested to create that "wow" experience for customers and whether the effort is worth it, given the expected additional revenue.
You may also like to read some of our recent articles on banking industry:
- Covid-19: Potential Implications for Companies in the Banking Industry
- What Lies Ahead for Asia’s Banking Sector?
- Winning Customer Mindshare in the Banking Sector with AI-driven Customer Intelligence
Want to understand the potential impacts of the COVID-19 pandemic on your organization? Contact us and our experts will get in touch with you with comprehensive insights.
About Infiniti Research
Established in 2003, Infiniti Research is a leading market intelligence company providing smart solutions to address your business challenges. Infiniti Research studies markets in more than 100 countries to help analyze competitive activity, see beyond market disruptions, and develop intelligent business strategies. To know more, visit: https://www.infinitiresearch.com/about-us
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