How are your customers like bees? Today, customer “bees” are faced with a huge garden of businesses that offer every ‘color’ and ‘variety’ of flower imaginable. Those ‘flowers’ can be wildly different but they look the same from a distance. With so many choices, the bees are bound to go sampling around. So how does a company differentiate itself within the landscape? Companies study the bees’ behavior, learn from it and then take steps to make sure their plot in the garden is the most enticing and their flowers are the most attractive! At least that’s how Lloyds Banking Group approaches it.
As the largest financial services provider in the United Kingdom, Lloyds touches nearly every household and community in the country with multiple brands, services and businesses in all aspects of banking and finance. Continuing our bee simile, Lloyds also tries to make the whole garden a better place to live by helping improve local economic and social issues as described in the “Helping Britain Prosper Plan.”
It’s a big endeavor to be “the best bank” for its customers so Lloyds focuses on driving productive business outcomes in four primary areas:
- Customer experience;
- Finance transformation;
- Risk mitigation; and
- Operational excellence.
When we recently sat down with Simon Howarth, Chief Subject Matter Expert for Information Management at Lloyds, he told us, “We obviously get a lot of benefit from internal usage of data. Most of the projects we run are servicing other areas of the bank to provide them with the data that underpins the operation they have. It's very much about understanding the customer, and what they're doing, the risk side, the fraud side, the marketing side, the commercial side, and the pricing side. It touches on every aspect of Lloyds Banking Group business.”
But Simon feels that “if you can’t access it [data] and use it, then it’s not much use.” So how do they make all that data useful to all those parties? They combine all their data in one place and open relevant detail to exploration among groups so more questions can be asked, more insightful answers given--and more value returned to the “hive.”
An environment of this scope and depth also requires a cultural shift; everybody has to put stakes in the game. For instance, in a unique show of teamwork the digital, marketing, and customer insights groups come together to identify common goals and “crowdfund” various analytics initiatives. In turn, they deliver quickly with short sprints, share the findings and build more support. And, ultimately, they produce results.
One primary area of interest to the bank is to “understand and pull together all the different interactions that a customer has.” It’s a lot of work to track Annie Bee’s shenanigans! As Simon explains “Paths aren't linear for somebody to actually get a product. Traditionally, what we've done is look at a product’s completion, therefore the person has gone through step one, two, three. Actually, people go through steps one, two, back to one, then to three, back to two, back to one again, off out somewhere else. You can see a lot of looping going on, and that's quite inefficient while it's happening.
But the bank wants to make it as painless as possible for customer to take out a product and get the best offer. That’s where highly tailored marketing campaigns come into play. These efforts, in fact, drive 25% of the bank’s sales leads. According to Simon having rich data and the ability to fine-tune makes all the difference.
“I think the biggest benefit is the ability to really tune that campaign. To actually understand and get closer to that individualization of campaigns and get to the point where, you know, you want as high a conversion rate as you can do. Because, you want to avoid hassling people, and you want to be seen to be adding them benefit. You don’t want them to have received the third credit card letter through the post in the last month. It's reliant on the data underneath, but having the data underneath and having that ability to be really targeted, I think is the big thing.”
Behind the scenes, Lloyds continually conducts proofs of concept to probe its database for deeper insight and customer understanding. One such example was to monitor call center volume. As customer calls steadily declined, staffing was adjusted. When volume started to increase, the bank worried that service levels and customer satisfaction would be impacted if the trend continued.
To better understand what was happening and if additional staff was needed, four-months each of banking and marketing interactions are placed in chronological order and triangulated. While doing this, the bank discovered that call center inbounds looked like this:
- 20% active account
- 26% payment customer
- 33% credit card customer
Further investigation suggested that some calls may have been triggered when the government tightened rules for credit card fraud. In addition, a strong relationship was drawn between receiving a fraud alert and contacting a call center. In fact, it appeared that reaction to fraud alerts was rapid and likely to cause a pronounced spike into the call center. Think about it. If you received a text message that there was fraudulent activity on your credit card, how would you respond?
This is one example of how Lloyds is equipped to conduct proof of concepts that help identify changes needed in business processes due to external market changes. This mitigates risks, internal costs and ultimately manages customer satisfaction!
At the end of the day, the bees always fly back to the hive. With its inquisitive and disciplined approach to analytics, Lloyds Banking Group is doing everything it can to make sure each of its customers arrive home satisfied and share their experience with others.
For more information about our customer and their story, please view their video.