Digital transformation has dramatically reshaped the Banking, Financial Services, and Insurance (BFSI) sector. Technological advancements, changing regulations, and shifting customer expectations have set the stage for a revolution in how these companies conduct business. Amid this sea of change, one constant remains – the importance of customer engagement. Strong customer engagement strategies can be the differentiator between BFSI companies that thrive and those that fail to keep up by making some common BFSI customer engagement mistakes.

In this blog, we’ll strive to understand what customer engagement means in the BFSI world and what are some of the most common BFSI customer engagement mistakes that companies make that negatively impact their customer engagement. 

As a bonus, we’ll also discuss companies that navigated these challenges and are now seeing improved customer engagement. 

Decoding Customer Engagement for BFSI Companies

In the BFSI domain, customer engagement is not just about making transactions; it is about creating valuable, enduring relationships with customers. It’s about integrating the customer into the very fabric of the business, generating value at every interaction, and building a bond that fosters trust and loyalty. Successful customer engagement translates to a loyal customer base, augmented transaction volume, and, ultimately, improved business profitability.

Navigating the landscape of customer engagement, however, isn’t always straightforward. BFSI companies often stumble across common pitfalls that hamper their ability to connect meaningfully with their customers. Let’s take a closer look at these obstacles.

Also read: Best performing In-App Message Templates for BFSI 

Common Pitfalls to Avoid in BFSI Companies

1. Poor Customer Experience: The Silent Killer

A positive customer experience is the cornerstone of customer engagement. However, many BFSI companies fall short, providing inconsistent and subpar experiences that result in dissatisfied customers and damaged relationships. A disjointed or difficult customer journey can lead to dissatisfaction, tarnishing the company’s reputation and eroding customer trust.

Find out How to optimize customer journey mapping in insurance for better customer experience. 

Consider the transformative journey of JP Morgan Chase & Co. Recognizing the potential fallout of poor customer experience; they strategically invested in enhancing their digital platform and customer journey. By streamlining their digital platforms, integrating various customer touchpoints, and upgrading their customer service, they created a cohesive, frictionless customer experience. 

This transition significantly boosted their customer engagement, turning a potential shortcoming into a powerful advantage.

2. Ignoring Security and Privacy Concerns: A Risk Too High

In an era where data breaches make headlines, BFSI companies must prioritize data security and not make this BFSI customer engagement mistake. Customers trust these organizations with their most sensitive information and expect them to uphold stringent security standards.

BBVA, a multinational Spanish banking group, is an exemplary model of stringent data security. They fortified their customer data with advanced encryption, implemented strict security protocols, and added an extra layer of protection with two-factor authentication. In addition, they took customer engagement a step further by implementing a comprehensive customer education initiative around data security, thereby fostering trust and reinforcing engagement.

As a result of this strategy, BBVA saw a 56% growth in their customer engagement and new customer acquisition.

3. Lack of Personalization: Missing the Individual

In today’s hyper-connected world, the one-size-fits-all approach is a relic of the past. Personalization is no longer a good-to-have option; it’s an expectation. Customers expect services that are tailored to their unique needs, preferences, and behaviors. Despite this, many BFSI companies continue to follow a one-size-fits-all approach, resulting in missed opportunities for engagement.

An inspiring example is Capital One, a company that has truly embraced personalization. Using the power of advanced analytics, they’ve designed highly personalized customer journeys. By customizing their offerings based on individual customer behaviors and preferences, they’ve seen a significant uptick in customer satisfaction and engagement.

They even allow customers to design their own personalized credit or debit cards. This makes it fun for users and gives each user a unique and highly personalized experience to talk about, driving word-of-mouth marketing.

4. Overlooking Gamification: Losing the Fun Factor

Gamification, the art of applying game design elements in non-game contexts, is a potent tool for boosting customer engagement. The BFSI sector is typically not associated with fun and games, but that’s exactly what some companies are bringing to the table. Not adding gamification is probably the most common BFSI customer engagement mistake.

DBS Bank in Singapore has skillfully harnessed the power of gamification. They introduced a mobile app that gamifies personal finance, rewarding users for meeting financial goals. This innovative approach has turned banking from a chore into an engaging activity, boosting customer engagement in the process.

Discover Gamification in Fintech: Top 5 Fintech Gamification Examples To Level Up in 2023!

5. Inadequate Communication: The Disconnect

Communication is the lifeblood of customer engagement. Delivering the right information at the right time is critical. BFSI companies often stumble in this area, either overwhelming customers with irrelevant information or failing to communicate important updates. Companies should look to incorporate a healthy mix of SMS, email, in-app messages, and push notifications to keep their customers informed and updated.

American Express (Amex) has mastered the art of effective communication. They utilize data-driven insights to deliver timely and relevant communication to their customers. This strategic approach has strengthened their customer relationships and bolstered customer engagement and loyalty.

Confused about how to measure and grow Active Users in BFSI?

6. Ignoring Feedback: The Missed Opportunity

Feedback is a treasure trove of insights into customer expectations. Ignoring customer feedback is akin to flying blind. Feedback provides valuable insights into customer expectations and helps identify areas for improvement. Yet, many BFSI companies fail to harness the power of feedback, resulting in missed opportunities to enhance customer engagement.

Zurich, a Swiss insurance giant, reversed this trend by giving customer feedback the attention it deserves. They used these insights to revamp their digital strategy, focusing on areas that mattered most to their customers. Their commitment to responding to feedback has elevated their customer engagement levels.

Conclusion

Steering clear of these common BFSI customer engagement mistakes can empower BFSI companies to reach new levels of customer engagement. This, in turn, can fuel customer loyalty, enhance transaction volume, and drive business growth. However, successfully navigating these challenges demands a strategic roadmap and meticulous execution.

Also read: 5 Challenges Fintech Apps face and how to conquer them 

Harnessing the Upshot.ai Advantage

Enter Upshot.ai, a sophisticated customer engagement platform designed to help BFSI companies overcome these challenges. Upshot.ai equips BFSI companies with a comprehensive toolkit to tackle these customer engagement challenges head-on. Our cutting-edge solutions enable companies to create seamless customer experiences, deliver personalized communication, adopt effective gamification strategies, and establish an efficient feedback system.

Our platform allows you to personalize the customer journey, gamify the user experience, and streamline communication to bolster customer engagement. Embrace the Upshot.ai advantage and transform your customer engagement challenges into growth opportunities.

So why wait? Embrace the Upshot.ai advantage and turn your customer engagement challenges into growth opportunities.

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