With recent advances in artificial intelligence (AI) and shift in mobile usage, banks need to shift their communication and start having conversations with their digital customers.
Conversational User Interfaces (CUI), based on messaging platforms and voice- or text-based interfaces, are becoming an increasingly popular customer interaction paradigm for digital natives and digital skeptics alike.
According to several indicators and analysts, Conversational User Interfaces open up new and unexplored challenges to traditional Banks organizations. With Conversational, banks have access to a new channel where all their automated interactions are reshaped in a unified, customer-centric interface that must reflect both the bank's brand identity and customer’s individual profile. Long-term, banks will have to understand how to differentiate their conversational channels, reconciling their brand identity attributes with bots’ personalities.
Commerce is embracing conversation; we’re surrounded by devices that listen, learn and respond to our thoughts and questions, as we share information about ourselves we once kept private. This has created streams of data and insights into how we live, how healthy we are and what we buy.
Our mobile apps have also reached a tipping point, transitioning from transactional use to interactional, as apps develop the ability to talk to speak to other service providers.
Internet and mobile banking growth is showing signs of saturation in more advanced countries. In addition, digitized customers say they miss the personal interactions once provided by tellers, although the cost of maintaining traditional branch networks is increasingly unsustainable.
Conversational channels have the potential to help banks solving this customer interaction conundrum, capitalizing on three major consumer and technological trends:
#1 Messaging is now the preferred customer touchpoint
Messaging apps are now the dominant form of mobile interaction, enabling easy, fun interactions on the move. Their simple, intuitive text or voice-based interfaces are loved by Millennials, as well as by consumers typically more reluctant to embrace digital channels too. They’re also AI-ready, offering easy integration with chatbots and cognitive agents.
#2 AI is becoming ready for B2C
As AI continues to develop, bots are becoming more human-like in their interactions, and can now be built with self-learning capabilities. That enables not only the automation of repetitive customer care tasks, but also low-value advisory services.
#3 Mass personalization and liquid expectations
By leveraging new data-driven insights, companies are able to offer unmatchable customer experience and personalized digital services at a mass level. This creates competition across, as well as within industries, as customers' "liquid expectations" means each digital interaction is expected to be as good as the best last experience, regardless of brand or industry.
The obvious first step in a conversational banking strategy is a chatbot or virtual assistant. These cognitive agents are booming, thanks to advances in natural language processing, speech capabilities and object recognition, together with the increasing availability of low-cost cloud computation and real-time access to almost limitless volumes of data.
Established messaging apps have embraced chatbots. And as the bots proliferate, they’re becoming a part of consumers’ everyday lives. There are already more than 33,000 bots on Facebook Messenger, offering automated customer support, e-commerce guidance and other interactive experiences.
A chatbot might be a sensible starting point in a journey to setup a conversational channel, but it shouldn’t be confused with the final destination. Most bots today have limited capabilities: some are merely interactive replacements of static FAQs, or low-cost / limited service alternatives to human-based customer services.
As AI and Digital Assistant tools evolve rapidly, banks will need to recruit in new skills and talent including neuro-linguists, voice recognition experts, AI experts, and CUI designers.
Appropriate technology is needed to support Conversational Banking; platforms must be up-to-date and enabled to facilitate real-time actions.
Banks must establish trust with customers and ensure they implement robust privacy protection policies, as AI has access to highly personal information.
Successful face-to-face conversations rest on a sense of trust and openness; banks must be honest about when they’re using AI.
When launching a CUI, banks need to carefully select the channels to prioritize, depending on geographic factors, target audience, and on privacy protection offered by each platform.
Developing engines where AI and humans work in tandem, mitigates the risk of chatbots operating independently, and enables humans to step in based on the nuance of customers queries.
Conversational banking is still at an early stage. But it’s a new digital channel that will surely become mainstream and a key element of an omnichannel distribution network for banks. In order to successfully exploit it to best fulfil customer needs, it will require banks to recruit and nurture new skills, integrate new technologies and focus on a strong marketing strategy to differentiate their services.