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Certificate in Retail and Digital Banking (Cert RDB) > 9. The Customer Experience > Flashcards

9. The Customer Experience Flashcards

1
Q

Is providing the customer with a good experience more or less important within today’s digital age? Why?

A

More. Comparative sites have made it easier to compare experiences, so need to give a good experience to gain a competitive advantage

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2
Q

What is the Extended Marketing Mix? What is it’s aim?

A

A set of controllable marketing tools that firms allows firms to see their product through the lenses of different target groups (rather than one size fits all) and market to it to them accordingly.

Aim = provide more relevant/bespoke offerings to meet needs

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3
Q

What are the 7 P’s of the Extended Marketing Mix?

A
  1. Product
  2. Place
  3. Price
  4. Promotion
  5. People
  6. Process
  7. Physical Evidence
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4
Q

Which of the 7 P’s of the Extended Marketing Mix should firms consider when examining how convenient something is? (3)

A
  1. Product
  2. Place
    - can the product/service be accessed across a range of channels? Particularly ones they like to use.
  3. Process
    - Is the product/service easy to use?
    - does the product look and feel the same, regardless of delivery channel?
    - what support is available if things go wrong?
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5
Q

What makes up a firm’s brand? (5)

Why are brands important?

A
  1. Name
  2. Logo
  3. Design
  4. Image
  5. Representation associated with the firm and their products

Makes a firm distinguishable in the market

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6
Q

True or false: all of the 7 P’s of the Extended Marketing Mix should be considered to reflect the firm’s brand?

A

True

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7
Q

What makes up a firm’s market image? (6)

A

It’s a wider collection of thinks which work together to make an impression on the public:
1. Facts
2. Events
3. Experiences
4. Advertising
5. Logos
6. How employees act

Think: FEEL AA

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8
Q

True or false: a firm’s brand is it’s market image?

A

False. Their brand makes up part of their market image, but this is just one component. Market image is much wider than just a brand, it’s everything about the firm that makes an impression on the public.

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9
Q

True or false - it’s easier for brands to control their brand and market image in today’s digital age?

A

False - it’s actually harder for them to control their own narrative because social media and review sites are now the main source of information for whether a product or service can be trusted.

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10
Q

Define service level.

A

A metric used to measure how a service is performing against how it is expected to perform

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11
Q

What are the challenges to providing an ‘expected’ level of customer service?

A

Customer expectations of service will be subjective and based upon their own experiences and personal standards

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12
Q

According to Berry & Parasuraman (1991), what are the five factors that influence service quality? I.e., what should frontline staff demonstrate in order to provide excellent customer service? (5)

A
  1. Reliability
    -dependable, accurate, consistent, confidential
    -keep promises/agreements
  2. Responsiveness
    - be willing and available to provide a service at a time which meets customer needs
  3. Assurance
    - use own skills, knowledge & personal qualities to gain the customer’s trust and confidence
  4. Empathy
    - Understand the customer’s perspective
    - use emotional intelligence
    - focus on their needs
  5. Tangibles aka physical evidence
    - personal appearance
    - quality of premises or website
    - quality of literature used

THINK: TEAR R

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13
Q

What are the 6 principles of John Tschol’s Personal Success Plan? What is it’s purpose?

A
  1. Personal Attitude
  2. Good Manners
  3. Communication
  4. Meeting customer needs
  5. Listening
  6. Learning

Aims to achieve excellent customer service by focusing on the personal performance of those providing the service

THINK: AC ML ML

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14
Q

How do we define customer experience?

A

How a customer feels about their interactions with the bank.

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15
Q

True or false - an interaction is something that happens between a customer and a staff member.

A

False - interactions can indeed be between a customer and staff member but they can also be delivered by a system.

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16
Q

What percentage of those who experience good customer service return to the bank?

A

84%

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17
Q

What percentage of those who experience poor customer service return to the bank?

A

29%

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18
Q

True or false - those who experience good customer service are 3 times more likely to make a recommendation to others

A

False. They are actually 5 times more likely!

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19
Q

It’s difficult to achieve good customer service today because we live in an ‘expectation economy’ and people are almost impossible to please.

What are the 3 main things that people expect that banks find hard to achieve?

A
  1. RISING QUALITY
    - customer expect the quality of products and services to be constantly improving
    -expect banks developing more ‘feature-rich’ apps which offer a more tailored/personalised experience
  2. POSITIVE IMPACT
    - Social/environmental responsibility
    - banks are expected to contribute to community wellbeing & be environmentally sensitive
  3. PERSONAL EXPRESSION
    - customers expect to have their say in how a bank’s services can support their lifestyle needs
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20
Q

What are the following examples of:
- HSBC’s Water Programme in partnership with Water Aid
- Barclay’s Digital Eagles Programme

A

Corporate responsibility programmes, i.e. ways in which banks try to make a positive impact.

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21
Q

What does the Barclaycard Grab & Go app offer?

A

Queue-less check-out

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22
Q

Which 7 points act as a guideline to help to ensure banks take the correct approach with their customers, consider the right data, and develop an appropriate staff mindset?

A
  1. Think “CUSTOMER-IN” not “bank-out”.
  2. Have a CLEAR VISION OF CUSTOMER EXPERIENCE.
  3. Know exactly who the TARGET CUSTOMERS are.
  4. Build EMOTIONAL CONNECTIONS with target customers
  5. COLLECT & ANALYSE FEEDBACK
  6. Instil an ETHOS OF QUALITY in all the bank does
  7. LISTEN TO CUSTOMER-FACING EMPLOYEES and take on board what they say

THINK: CCCCC QT

23
Q

What is a ‘sticky’ customer experience? Are customers more likely to switch banks if they’ve had a ‘sticky’ experience?

A

When a customer adopts a product/service and it becomes part of their everyday life, embedded into how they think/act/behave.

Helps with long-term retention and CLV because it makes it difficult to switch banks - the customer enjoys what they currently have so it’s not worth the effort to switch

24
Q

What types of business are most likely to attract ‘sticky’ customers?

A

Long-term successful businesses

25
Q

Define hyperadoption.

A

The rapid and simultaneous uptake of unprecedented behaviours.

e.g. people trying new things all the time. Opposite of sticky customers. This keeps getting more common as digital age increases competition

26
Q

What is a KPI

A

Key Performance Indicator

Quantifiable measure used to evaluate success in meeting performance objectives

27
Q

What is an SLA?

A

Service Level Agreement

Service contract between provider and customer. Contains specific measurable aspects specific to service offerings.

e.g. has firm done what they said they would in the contract

28
Q

What is a bank’s current KPI value as opposed to a target KPI value?

A

Current = how the bank is performing now

Target = how customers would like the bank to perform

29
Q

What is the customer’s current expectation gap?

A

The gap between the bank’s current and target KPI values.

e.g. Bank’s current response time is 2 hours. Digital age customer expect response in 1 minute (target KPI value) so the expectation gap is 1 hour & 59 mins.

Banks should try to close the gap to improve customer experience

30
Q

What are the three main types of KPI metrics used to measure customer satisfaction? (3)

A
  1. Net Promotor Score (NPS)
  2. Customer Satisfaction (CSAT)
  3. Customer Effort Score (CES)
31
Q

What information does Net Promotor Score (NPS) measure? What method is used? How are results presented as a scoring?

A

What info = Customer perception

Method = Asks the question “How likely are you to recommend the brand to a friend/colleague?” and sometimes “why?”

Results = percentage of customers who are promotors, less the percentage of customers who are detractors

32
Q

Define the following concepts used in Net Promotor Score (NPS):

  1. Promotors
  2. Passives
  3. Detractors

Which should banks focus most attention to?

A
  1. Loyal enthusiasts who will keep buying & refer others. Fuels growth.
  2. Satisfied but unenthusiastic. Vulnerable to competitive offerings.
  3. Unhappy customers who can damage the brand & impede growth through negative word of mouth.

Should focus on converting passives into promotors. Focusing on converting detractors is usually a waste of time.

33
Q

What information does Customer Satisfaction (CSAT) measure? What method is used?

A

What info = average satisfaction score that customers give after a specific experience with the bank

Method = In-depth survey responses. Usually given a scale of v. unsatisfied to v. satisfied, with an option for neutral in the middle.

The reason for the surveys being in depth is because some larger banks don’t want to bombard customers with lots of single question surveys

34
Q

What information does Customer Effort Score (CES) measure? What method is used?

A

What info = assesses the level of effort required for a customer when interacting with a business either as a whole, with an individual or within a life-cycle (this is when effort levels change when customers become more familiar with a product)

Examples of effort being expended in tasks includes:
- assessing which product is most suitable for them
-resolving problems via support services

Method = post-interaction surveys (usually digital). Responses are selected on a scale of Strongly Agree, Agree, Somewhat Agree, Neither Agree nor Disagree, Somewhat Disagree, Disagree, Strongly Disagree

35
Q

What percentage of customers become disloyal to a brand based on high-effort experiences?

A

96%

36
Q

What are the CEB drivers of disloyalty? (7)

A
  1. Repeat contacts
  2. Channel switching
  3. Transfers
  4. Hassle factor
  5. Policies/processes that customers endure
  6. Repeating info
  7. Robotic service

Think RRRCT HP

37
Q

What are the main benefits of banks choosing to use Net Promotor Score (NPS) to measure customer experience? (4) What are the cons?

A
  1. LONG TERM metric
  2. Provides SEGMENTATION (promotors, passives, detractors)
  3. Broad nature of questions leads to ACCURATE FEEDBACK
  4. HIGH RESPONSE RATES

No cons recorded by LIBF

38
Q

What are the main benefits of banks choosing to use Customer Satisfaction (CSAT) to measure customer experience (1) What are the cons? (2)

A

Pros
1. FLEXIBLE, has customisable questions which result in a detailed analysis of strengths and weaknesses

Cons
1. SHORT TERM
2. SUBJECTIVE RESPONSES - people define ‘satisfied’ differently

39
Q

What are the main benefits of banks choosing to use Customer Effort Score (CES) to measure customer experience? (1) What are the cons? (2)

A

Pros
1. Good PREDICTOR OF FUTURE BUYING BEHAVIOUR & how people will speak to others about the brand

Cons
1. NO SEGMENTATION
2. DOESN’T FEEDBACK REASONS BEHIND PROBLEMS BEING EXPERIENCED

40
Q

How can banks gain competitive advantage (2)?

A

The need to offer GREATER VALUE by either:

  1. LOWER PRICES
  2. HIGHER QUALITY OF SERVICE (justifying higher prices)
41
Q

What is cost leadership?

A

Reducing costs to lower than competitors (offering the best price)

Rarely a good option as it lowers profits and could be easily matched by competitors

42
Q

What is Prof Michael Porter’s Generic Strategies Model? What options does it contain? (3)

A

Method for building/maintaining competitive advantage

  1. Cost Leadership
  2. Differentiation
  3. Focus
43
Q

What is differentiation (in relation to competitive advantage)?

A

Firms select 1 or two customer attributes and uniquely position themselves to meet these needs.

Idea is that products will be more valued by customers and worth paying more for.

44
Q

What is focus (in relation to competitive advantage)?

A

A business’s choice regarding whether to focus on specific segments of the market or take a broader approach.

Focus is not a strategy to be considered on it’s own but instead in conjunction with other strategies, e.g. you can implement differentiation either on a broad scope or to a segmented section of market

45
Q

Which types of bank use DIFFERENTIATION as their main strategy for achieving competitive advantage? (2) How do they do this?

A
  1. Traditional established banks
  2. Small established banks (e.g. Co-op, TSB, Metro)

Offer a wide variety of products to serve a wide range of customers.

46
Q

Which types of bank use COST FOCUS as their main strategy for achieving competitive advantage? How do they do this?

A

Challenger Banks

They take deposits from a wide range of customers but only lend to specific segments of the market (this is the focus element). They are then able to manage costs by not having branch networks and using intermediaries like brokers and online platforms as their main distribution channels.

47
Q

Which types of bank use COST LEADERSHIP as their main strategy for achieving competitive advantage?

A

None use cost leadership alone. From time to time a bank will lead on cost but this is not sustainable over the long term.

48
Q

Which bank uses DIFFERENTIATION FOCUS as their main strategy for achieving competitive advantage? How do they do this?

A

Danske Bank - a Danish bank which has a branch network serving customers in Northern Ireland. The differentiation here is that they focus on a specific geographical area.

49
Q

What are core competencies?

A

The specific capabilities/strengths of a business used to achieve competitive advantage ( I.e. areas of specialised expertise/what they are good at).

50
Q

What are some examples of areas of core competence which banks can use to gain competitive advantage? (3)

A
  1. Innovation/product design
  2. Processing efficiencies
  3. Knowledge/Experience
51
Q

What are the advantages of core competencies? (3)

A
  1. Difficult for competitors to imitate
    2.Can be applied to a range of products and markets (e.g. Honda has a core competency in developing engine products, they have been able to exploit this in cars, lorries, lawnmowers, snow blowers).
  2. Enhances the customer’s experience of using the product/services
52
Q

True or False - a business’s core competencies are decided at its inception and the business will stick with those same core competencies throughout its whole existence.

A

False, successful businesses continually refine and change their core competencies to meet changing customer needs

53
Q

What is a USP? How is a business’s USP presented to customers?

A

Unique Selling Propositions.

What = This is how businesses USE, PACKAGE & MARKET their core competencies. The ACTUAL OR PERCEIVED difference that SEPARATES THEM FROM COMPETITORS (i.e., how the businesses shows others what they are good at).

How = focus on the benefits of products rather than their features, i.e. how they provide a solution to the needs/problem as they shows the products have been developed with the customers in mind.

54
Q
A

Certificate in Retail and Digital Banking (Cert RDB) (23 decks)

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