By Marieke Saeij, CEO at Onguard
Customer loyalty is fading as consumers find it easier than ever to switch providers. For instance, 2018 saw record numbers switch energy providers, while mobile phone users can now switch network with just one text. Consequently, to avoid high customer turnover and boost retention, customer experience is becoming a focal point for many businesses.
After all, brand loyalty is often a natural consequence of customer satisfaction. In some organisations, like insurance companies, the responsibility for customer experience is frequently falling to their finance teams. While this may seem like an unusual role for the finance department, these employees are often the final step in the buying process and providing a poor experience at this stage may discourage repeat custom. They’re therefore as integral to the customer experience as the sales department.
How can finance departments improve customer experience?
Research has shown that it costs companies six to seven times less to retain a customer than to acquire a new one. In other words, existing customers are more profitable. But to retain customers, businesses need to stand out from the competition and, besides offering a lower price, the most effective way to do this is to offer a better level of service.
Key to improving customer experience is making things as easy as possible for the customer. One way finance departments are equipped to do this is through their use of customer segmentation. While this is more commonly used to improve credit control processes and therefore cashflow, its use is also highly beneficial in enhancing the customer experience.
As finance departments are primarily focused on receiving payment for invoices, tailoring services to customer needs and doing everything possible to enable them to pay on time are a must. Therefore, the more the finance team knows about the customer, the better. This information can be used to adopt a personal approach based on identified needs and requirements. For example, it’s possible to find out how customers want to be contacted, whether that’s via email, phone or perhaps even WhatsApp, and how they like to pay.
By finding out as much as information about a particular customer in advance, finance teams can tailor their invoicing and credit management procedures to their needs and requirements. This data can then be used to group customers into segments and create corresponding workflows which determine how the business interacts with individuals, for instance. By segmenting customers, the finance team can build a better understanding of them and therefore better meet their needs, maintain satisfaction and build a close, long-term relationship with them. This approach also ensures that they know exactly where each customer is in the process and promotes fast payment.
Key to improving customer experience is making things as easy as possible for the customer.
As finance teams strive to improve the customer experience, it is vital they remove friction from and streamline the payment process. This can be achieved by offering better digital capabilities and more varied payment options. Similarly to sending invoices in the customer’s preferred method, it is also possible for businesses to allow customers a variety of ways to pay. For example, via direct debit or by being sent a link to a payment platform.
Additionally, more finance departments are adopting technology which allows them to automate repetitive processes that until now have been done manually. As a direct result of this, more time can be spent providing better customer service and focusing more closely on the higher value accounts or those experiencing financial difficulties.
Understanding the importance of relationship management and solving problems with the customer creates mutual understanding and builds a close relationship with the customer. They are not only then more satisfied with their experience but are also far more likely to pay their bill sooner next time.
With both the finance and sales departments playing crucial roles in delivering high-quality experiences, it is essential that both teams engage in two-way communication with the customer, to gain a better understanding of what their needs and wants are. After all, a happy customer is a loyal customer. The two departments need to work in close conjunction to ensure this. Sales are the lifeblood of any organisation and a breakdown between finance and sales can lead to problems and impact an existing or potential customer.
As finance teams strive to improve the customer experience, it is vital they remove friction from and streamline the payment process.
Finance must appreciate that sales are vital to the success of the business and sales need to appreciate that a sale is only good when it is paid for, preferably on time. Sales and credit are likely to have the most communication with a customer or potential customer and both need to sing from the same song sheet. On too many occasions, communication is poor, leading to lost customers and therefore lost business. No one benefits in this scenario.
Additionally, to further remove friction, finance and sales departments should have regular meetings and training sessions. This will ultimately lead to a better understanding of each other’s roles, difficulties and what each experience on a day to day basis. Working together is hugely beneficial to all involved, making for a happier working environment and a smoother, more consistent customer experience.
A consistent experience
As businesses compete for new customers and strive to retain existing customers, the finance department will continue to play an integral role in the customer experience. While this is something that may have traditionally fallen to sales teams, in the future, organisations will require the two departments to work together to provide a consistent and frictionless customer experience.
By ensuring the lines of communication between sales and finance are open, implementing the right technology and using the information they have to provide a personalised experience for customers, the finance department will not only improve customer satisfaction but could also streamline and improve operations.