The challenge
Technology may have given banks apps, slick websites and a host of automated functions, but it hasn’t changed the fact that clients still expect a personalised one-to-one experience.
Given that Westpac only had one staff member to every 500-600 customers, it was physically impossible to deliver this, especially since Kiwis are now active across multiple channels daily.
The lack of connection between the bank with customers meant that account holders made their decisions based entirely on which deals they regarded as the best, irrespective of what their current bank offered. In 2012, research from Roy Morgan showed one in ten people changed banks over a 12-month period, up nearly 100,000 from the previous year.
And the trend didn’t seem to be slowing down, because a Horizon Reasearch poll conducted around the same time found that of the 1165 residential homeowners with mortgages surveyed, 43.5 percent believed they would go shopping for better rates or loan conditions within the next 12 months.
And in a highly competitive environment, typified by clients constantly on the look for good deals, banks aggressively attempted to outdo each other with better deals.
Advertisements offering new credit cards with rock-bottom interest rates, home loans with TVs and term investments promising ever-greater returns flooded onto all media channels as competing banks attempted to win unsettled customers that were looking for something better.
But acquiring new customers in this way tends to be expensive, meaning that maximising the value of existing customers remains the cheapest way for banks increase their profits.
However, a problem faced by banks throughout the world is that it has become difficult to develop deep customer relationships in the online age. As technology has automated many elements of the banking experience this has led to a drop in oneon- one experiences with the bank’s staff.
The response
Given that this lack of personal connection was a problem all banks faced, the team at Westpac set out to find a way to solve it and, in doing so, establish a point of difference, which would help to maintain customer numbers.
In the past, Westpac’s technological solutions had been siloed and channel specific. So, when setting out on this task, the team wanted to create something that would provide a uniform customer experience across all elements of the bank’s offering. And to do this, Westpac developed Symphony, an omni-channel interface that creates bespoke communications, designed in near real-time for each customer. The data-driven Symphony system takes transactional, behavioural and demographic data from 14 disparate sources, and transforms it into a useable format. It then uses 53 million rows of data to create communications at defined times across seven different channels—AT M, Email, SMS, direct mail, secure online communications, live chat and frontline teams—for 1.2 million Westpac customers, using 572 context specific business rules, 127 customer attributes and a database of 500 ranked messages, resulting in 806,990 possible combinations within email alone.
While highly technical in the background, this algorithm enables Westpac to deliver personalised messages with customer-centric details rather than the generic emails that usually come from automated systems. Every message is sent from the customer’s relationship manager or local bank manager, and comes with a ‘next best conversation’ prompt to ensure that the communication link remains open.
Symphony has been designed responsively so that a conversation can be continued regardless of which device is being used. In this sense, a discussion started on a desktop, might be continued on a tablet before being finalised on a mobile device. And should the customer give negative feedback, then the issue is immediately referred to frontline staff equipped to address the problem. In fact, if customers wish to talk to a real person at any stage, then this can be done with a simple click of the call-back button accessible through their personalised banking microsite. Activating the call-back button generates a lead, which is sent to the customer’s personal banker and then followed up (often within four hours).
The results
Since its launch, the Symphony Engagement Programme has reached 1,018,531 unique customers, and had more than eight million ‘next best conversations’. While these numbers are impressive, it wasn’t Westpac’s aim to simply send out millions of messages to its customer base, but rather to establish a means of communication that was fast and personalised.
At the outset, Westpac wanted to reduce communication creation and delivery turnaround time from 28 days to seven. It now takes only 72 hours, and as little as 24 hours in urgent cases— meaning that increasingly impatient customers don’t have to wait ages to get the answers they desire.
The speed and relevance of this communication has also resulted in financial gains for the bank, with the average customer increasing their balance by 22 percent since engaging with the programme. Overall, this led to Westpac gaining a 172 percent return on its investment in Symphony within a year.
And while these impressive figures would’ve been enough to satisfy most of the efficacy of the system, Westpac wanted further confirmation. So, in an effort to show Symphony was directly responsible for the growth rather than other market activity, Westpac isolated a 10,000-person control group of customers and precluded them from receiving the targeted, relevant offers sent out through the interface. During the trial, only 121 (1.2 percent) of those in the control group took up new products or services. Comparatively, those in the Symphony Engagement Programme outperformed their counterparts in the control group by more than 10 times.
And with the foundation of this early success, Westpac is now looking for ways to improve the interface and algorithms to keep it relevant to constantly evolving consumers. So, in some ways, this is only the start of Symphony’s story.
