Building customer confidence

Opinion 2010-03-19 09:39

Companies that can quickly deliver personalised, relevant content using the channel that customers prefer — whether print, email, web, mobile or social networks — can capture greater loyalty and reduce the chance that customers will take their business elsewhere.

Personalised multi-channel communications can be the cornerstone of a strategy to build revenue growth through improved customer retention, increased customer advocacy, and better up- and cross-sell opportunities. In short, a way to build competitive advantage that can be delivered through the channel.

If there is one business principle that has re-asserted itself over the last 18 months, it is the importance of the customer. Customer focus, customer engagement and customer experience are very current topics.

In today’s competitive times building revenue growth - through customer retention and maximising cross- and up-sell opportunities - is an important objective for marketing, sales and line-of-business teams. These teams are also under increasing pressure to find better ways to connect and communicate with each customer on a personal level.

Meanwhile, the commercial environment for insurers is becoming more complex by empowered customers (armed with a much greater ability to compare offerings), increasing competition, and growing regulation.

Personalised communications contribute to the bottom line

The bottom line benefits of personalised communications are compelling. Industry research delivers up some interesting rules of thumb that underscore the bottom line impact of customer retention. The cost of acquiring a new customer can cost five to 10 times more than the cost of retaining one, while a five percent increase in customer retention can produce a 25+ percent increase in profit. In addition, customers where there is a strong relationship are 40+ percent more likely to remain a customer, 75 percent more likely to make recommendations to a friend and 50-60 percent more likely to buy more.

High quality communications are the key to building customer relationships and reinforcing good service. Even more so for insurers, who by the nature of their industry have limited quality opportunities to communicate with their customers, and need to maximise the potential of every touch-point.

The benefits flow on to the back office too: an intelligent approach to customer communications can be integrated with line-of-business operations - such as policy generation, claims processing and straight-through-processing - streamlining business processes, improving service and reducing cost.

There are three key overlapping elements to high quality communications:
Personalisation – a personalised communication is tailored to the individual customer and takes into account the full profile of the customer and customer history, preferences, language, even idiom. But personalisation by itself is not enough: relevance and context are critical.

Relevance – a relevant communication has a genuine purpose and level of appropriateness in terms of the customer’s expectations. Communications that are not relevant may be regarded as an intrusion and lead to a negative brand impression.

Context – being aware and understanding the situation surrounding the customer contact and shaping the communication appropriately. Context becomes more critical in the multi-channel world, and is absolutely critical with real-time and mobile communications.

In the end, the goal is to be able to give the customer exactly the information they need, at the time that they need it, using a communication channel that is both preferred by the customer and appropriate for the communication.