How are customer needs changing

The digital transformation is changing customer behavior and expectations

The digital transformation and networking through the Internet have changed customer behavior. Companies that underestimate these changes will quickly lose their importance in the market.

The widespread use of smartphones in particular means that customers are more mobile and better informed than ever. The interactions between customers and companies are changing, parts of the customer journey are shifting to digital channels. Research, comparison and shopping are carried out both online and offline. The line between online and offline is blurring. At the same time, the Internet creates transparency on the market. The information asymmetries between provider and customer are reduced, which ultimately leads to a shift in power towards the customer.

 

Personal advice remains important

Nevertheless, advice remains an important factor in the purchase decision, as customers seek personal contact, especially when it comes to complex and emotional issues. At the same time, customers increasingly need mobility and flexibility. They expect to be able to control interactions with companies individually and depending on the context. The customer expects self-service services, but wants to spend as little time as possible with them. That is why the services must be simple, as self-explanatory as possible and seamlessly expandable through additional channels such as personal advice.

The digital transformation promises customers additional benefits through innovations and personalized offers. This creates opportunities for companies to position themselves with new products, services and business models. The decisive success factor is the creation of an excellent customer experience based on customer needs. This is also the greatest challenge.

 

Learn from internet corporations

Companies like Google and Amazon are masters of this discipline. You manage to systematically record and analyze customer expectations and transform them into specific services in line with customer needs. For them, new technologies are a means to an end in order to create better services to meet customer needs. This is achieved by consistently simplifying processes or giving the customer easier access to the company. In addition, customer needs are addressed that are not covered by the company's own services. This consistent focus on customer needs enables these companies to strengthen their position of power at the interface with customers.

Such offers also change customer expectations of other companies and industries. What does this mean for banks in Switzerland? While e-banking is very popular in this country, the use of new digital offers has so far fallen short of expectations in many cases, as Twint and Samsung Pay, among others, show.

The British start-up Revolut demonstrates that it is also possible to inspire customers with digital services in Switzerland. Within two years and without advertising, the company was able to win over 50,000 customers with a smartphone-based offer. In addition to an attractively priced offer, Revolut offers a bundle of products and services that are tailored to the needs of digitally savvy customers. Many of them in cooperation with partners. Because the focus is on the relationship with the customer and the requirement to meet the needs of the target group.

 

The focus must be on customer needs

In contrast to Revolut, the established Swiss banks are confronted with the challenge of an existing and therefore heterogeneous customer base.

In order to bring the sometimes diverging customer needs under one roof, banks must consistently focus on the customer and his or her expectations. The following five points must be observed:

  1. With regard to segmentation, old thought patterns have to be thrown overboard. Segmentation based on customer behavior is required in order to identify customer needs at an early stage and to address customers more individually, personally and proactively.
     
  2. By using knowledge about its customers, the bank can proactively approach customers with relevant information, thereby strengthening customer loyalty and commitment. This builds up the position of the bank as a partner and the advisor as a companion and enabler.
     
  3. The purely product and service-oriented view of the offer design has had its day. Customers are not looking for banking products, but for a solution to a current problem such as buying a home. The offer must be structured according to needs.
     
  4. A real, needs-based offer extends beyond the core services of the banks and covers additional aspects along the customer journey. With partnerships and third-party providers, additional added value can be created over the entire customer journey.
     
  5. In order for the customer to have access to processes and offers anytime and anywhere, financial institutions must also ensure that they can be used seamlessly and across channels. It is imperative that consultants and customers have an identical view of information and data.

 

Dialogue with the customer

Customer needs are constantly changing. Companies must be able to anticipate these changes and respond to them quickly and efficiently. It takes the courage to break new ground and enter into a dialogue with customers about their wishes and experiences. Against this background, data analyzes are becoming increasingly important as a basis. With experiments and surveys, behavior can also be measured and customer feedback can be obtained. In the case of traditional and risk-averse companies such as banks, for example, this also requires a cultural change towards a flexible and responsive organization. They actively look for ways to create a good customer experience and are ready to learn from experience and sometimes mistakes.