By Judy Bloch, Vice President and Executive Advisor for Financial Services, Medallia
With challengers on the rise, the pressure is on within the financial sector. Deloitte’s 2025 Banking and Capital Markets Outlook confirms this, highlighting increasing competition from new market entrants, as more customers embrace non-financial institutions.
In a sea of intensifying competition, it is crucial that financial institutions distinguish themselves and adapt to shifting industry dynamics. This is where customer experience (CX) can act as a key market differentiator. Create a seamless journey that meets or exceeds customer expectations, and you’ll win loyalty and market share. Fail to get it right, even just once, and expect a significant proportion of customers (37 percent according to Medallia research) to immediately end their relationship with your company.
To stay ahead of the competition and ensure customer retention, financial service providers should implement these four strategies for successful CX journeys:
1. Capture customer signals across the entire journey
To maintain customer loyalty, financial institutions need reliable, continuous signal capture. Surveys alone won’t deliver the meaningful insights required and even with good survey completion rates of 10-15 percent, organisations still miss an overwhelming majority of the customer base.
The definition of ‘feedback’ must capture what customers say and do. That includes solicited feedback via surveys, unsolicited feedback, such as app reviews and social media commentary, and everyday customer interactions and behaviors that indicate intent. This way, businesses can truly understand what customers want – and act quickly to meet those needs, closing those gaps before they turn into churn. Financial institutions must integrate feedback across both verbal and behavioural signals and unify analytics across all omnichannel behaviours to gain deeper insight into the quality of CX.
2. Embrace AI
The merits of AI have been well documented, yet, within the financial sector there remains a hesitancy around its introduction. However, while concerns exist around the risks involved with such technology, there is also an understanding that a failure to embrace the tool will only set organisations further back against the competition.
Three key areas where the financial industry is already seeing benefits from AI include:
- Driving internal efficiencies by equipping CX leaders with powerful tools to refine operations and rapidly process vast volumes of customer data. This can be harnessed to create actionable insights, streamline customer interactions, and enhance staff efficiency.
- Powering self-service channels and enabling customers to resolve issues independently and efficiently through automated interactions.
- Agent assist tools – using AI to offer prompts to agents on the next best course of action freeing up employees to focus fully on the customer.
Those organisations who embrace AI into their CX offerings will gain a competitive edge and inspire brand loyalty.
3. The power of a personalised customer journey
Medallia research shows that businesses with top customer experience programmes are twice as likely to prioritise personalising interactions, highlighting the importance of valuing customers as individuals.
Customer journey mapping is a great way for financial institutions to deliver this personal touch. This enables them to address issues they may have missed and seize opportunities to act, thereby enhancing the overall CX delivered, and improving customer retention in the process. But delivering a truly personalised customer journey requires more than just mapping. Real time journey management and orchestration helps to deliver the growing customer demand and expectation for personalised experiences.
4. Prioritise employee experience for successful customer experience
Exceptional customer experiences are fuelled by an engaged and empowered workforce. Indeed, according to Medallia research, 69 percent of customers feel more loyal to a brand when they can tell employees are well treated.
As representatives of their organisation, employees must be supported and invested so they are empowered to deliver the customer experience that customers crave.
Integrating customer and employee experience is key to sustained growth. Actionable feedback both equips employees with insights to solve issues faster and encourages employees to engage with the organisation more substantially and feel more satisfied overall.
Consider a frontline agent who discovers that customers are struggling to navigate a mobile app. Sharing this information outside of the contact centre with the marketing and app development teams would allow the business to fix the issue quickly, improving the customer’s experience, while creating an empowering work culture – ultimately helping attract and retain top talent.
Differentiating with customer-centric strategies
Excellent customer experience is no longer a nice to have – it’s an essential component for financial organisations looking to distinguish themselves from the competition. Those that embrace AI, unified analytics, real-time signal capture, employee feedback and personalisation, will create an impactful CX journey that deepens customer trust and loyalty.
In a rapidly changing market, adopting customer-centric strategies and technologies is essential. By putting the customer at the heart of every decision, financial brands can build better connections, retain more customers and ultimately drive sustainable business growth.
