Customer Engagement vs. Entanglement
Customer engagement is a recurring theme in all service sectors. The challenge is understanding the nuance between engaged and entangled and how the customer really feels. Because how they feel about the relationship is what really defines your brand to the customer and the marketplace.
For example, retail banking has made a significant turnaround in trust and relationship building, over the past decade, with the community at large. But the challenge for today’s banks is, once again, trying to move the relationship from functional to optimal. For the retail bank this means engagement. Which, in banking terms, means your likelihood not to exit your primary banking relationship.
There are extensive writings about how to measure engagement, how to make the bank stickier to the customer and keep them from exiting. I don’t need to rehash the data. The reality is, the retail bank simply doesn’t know when you start shopping for a new primary bank. Engagement is measured by how many products or services you have opted into with your primary bank. And successful engagement is very profitable for the bank.
And that makes a lot of sense, from the bank’s point of view. The more products you use, the more comfortable you may be and the more satisfied you could be. It’s a very logical viewpoint. But it’s not all the story. This is where the engagement can quickly morph into entanglement.
Think, for a minute, about those two words. What they inspire. If the brand work has not been done, and there isn’t strong emotional equity invested in the bank, the relationship will not withstand a crisis moment, which is bound to happen.
This is the definition of an entangled relationship. Yes, it is hard to extricate, but the customer will do it, and loudly. It will reinforce all the negative thoughts around the brand and be shared among the customer’s circles.
In reality, no brand can avoid a degree of churn. But there is a lesson to be sought within the pursuit of engagement.
I believe the retail banking industry is due for a reset on engagement and, again, to pursue the customer along more relationship channels. It’s not enough to measure by product usage alone, the bank must connect in a meaningful way.
So, what could a bank be doing?
Develop the Meaningful Relationship
Stop communicating narrowly through product offerings and start relating to the whole client. Every customer has a need for every product. It is their degree of need that varies.
Start viewing the customer's relationship with the bank through a circumstance lens. Focus on the why, rather than the how of the customer's banking activity.
Close the gap between these circumstances and solutions in the easiest, most friction-free way possible.
Demonstrate a genuine curiosity in your customers well-being by actively communicating based on customer behavior.
Remind customers, with permanent recognition, when they have met goals, done well, or surpassed the average. Be the customer's cheerleader in surprising, unexpected ways. A financial FitBit.
Your bank isn’t your parent. But a bank could act like your favorite aunt. There to give you good advice you can take or not take. Remind you of how you did well that month with savings and cost cutting. And suggest how you might try something different if what you're doing isn’t working.
This is the difference between an engaged and entangled relationship.