The death of personal service: Will financial services customers who serve themselves do better than if they are served?

Abstract

This article focuses on the trade-off between efficiency and customer experience management in the financial services sector. It is based on the author's extensive work with financial services companies and review of the literature. Its main conclusions are that many financial services suppliers are under pressure to improve efficiency and margin, in some cases to increase the contribution to improving their balance sheet in the wake of the problems of the last few years. This financial pressure is leading some of them to choose the perceived win-win of a self-fulfilled customer experience with minimal staff intervention. As a result, consumers will be provided with ever more sophisticated self-service information and communications technologies, especially by suppliers using a multi-channel approach. Consumers will increasingly use their own technology, especially smart-phones, pads and other portable devices, to identify the best offers, to make comparisons between products and services, to manage relationships with financial services companies and to manage their accounts. Younger consumers’ strong preferences for buying in their own way will pervade the sector. The trend to self-service may lead to more and more consumers making the wrong decisions, in the absence of advice. For the more complex products, services or buying situations, supplier or third-party diagnosis of customer needs may be a substitute for self-diagnosis, but will not necessarily lead to better outcomes for consumers. This third-party diagnosis may be expert, for example, from sites dedicated to the purpose, or inexpert, for example via social media. Where advisory companies embrace the social approach, we may see an ideal situation evolving in which consumers do not need to exit social networks to obtain expert advice and coaching, and will be able to immediately compare expert advice from different sources, and with less expert advice and experience of outcomes. Financial services suppliers who fail to come to terms with these developments will lose market share to those who lead in applying information and communications technology to support self-service. Eventually, the self-fulfilled experience will be the norm, except for the most difficult and risky situations. Even here, the role of human intervention will be reduced.