WHAT NEXT FOR REGULATORY COMMUNICATIONS

Why they are failing and what can be done about it

Despite the focus Consumer Duty has created on better customer outcomes, many banking communications are still doing a poor job at meeting the needs of customers. Underinvestment in comms technology, and a historical focus on compliance and cost means many providers still have a big gap to close in capability before they can offer a competitive customer experience (CX) through their comms.

With CX such a key driver of business success, we decided to carry out some research to find out what customers think of the regulatory communications they receive from their banks and how they would react to a more customer-led approach.

The research, Better Outcomes for Digital Customers, explores consumer views on banking comms in general, as well as reactions to two different approaches to the same mortgage maturity journey. One journey follows a typical current ‘paperless’ approach whilst the second was designed using behavioural science design principles to drive the best customer outcome across a range of channels over a period of time.

You can access the full, detailed report here: Better Outcomes for Digital Customers

Key takeaways from the research

• Customers over-estimate their engagement with financial communications
• The secure inbox is not an effective channel for important messages
• Focusing on outcomes delivers better customer understanding
• Customers have high tolerance for frequent multi-channel communications
• Experience design best practice leads to improved understanding
• There is a disconnect between compliance requirements and customer attitudes and behaviour
• There is a significant opportunity to build brand trust and show empathy
  

What’s next for Regulatory communications?

Change must happen

We are entering a new era of regulatory communications in which consumer expectations and regulatory demands are working in tandem to increase the momentum for change. The change needed is wholesale and will require investment, focus and effort. But the potential rewards in terms of customer loyalty and satisfaction metrics are significant.

A catalyst for cultural change and improved outcomes

For those responsible for customer communications the imperative of consumer duty has been a gift – a godsend some have said - enabling them to get the attention of the organisation and help everyone understand how critical good customer communications are to better customer and business outcomes.

The Consumer Duty deadlines prompted several waves of industry-wide effort to grasp the new rules, catalogue communications, and demonstrate progress to the regulator.

And although a great deal of good work happened, the FCA have been quick to remind firms that significant effort still lies ahead and that this is simply ‘the end of the beginning of Consumer Duty’.*

Customer focus

However, the continued focus on cost and a mind-set of product first means regulatory messages are still primarily document-based with digital experiences in particular held back by arbitrary compliance rules pre-dating modern consumer expectations and outcome driven strategy.

Leading firms are now working hard to modernise legacy ways of working - rebuilding their communications set-up around outcome focused thinking. This change needs to be driven by a leadership focused on Customer Experience and embedded across all lines of business or product areas. Product experts who own the outcomes need to be supported with the tools, training and experience design support they need, allowing them to drive the right outcomes across the journeys they are responsible for.

A new model

There is a growing trend for the adoption of the Centre for Enablement (C4E) model, which focuses on driving comms excellence through the empowerment of federated teams. Not only is the C4E model fully scalable, it also builds expertise and best practice where it is needed most – amongst the communications owners in the lines of business. This is important because, in a world where outcomes are paramount, it’s essential for experience design best practice to be seamlessly integrated with core business processes and product knowledge.

Technology as an enabler

The race is now on for firms to balance the need for integrated customer communications management (CCM) and Martech systems enabling regulated messaging to customers chosen channel, with continuing robust governance of business rules and templates.

The good news is technology has made it simpler to work together and manage regulatory content, vastly reducing costs and risks whilst giving teams greater freedom to respond to customers ever changing needs.

Perhaps most significantly, new technology is emerging that allows for greater management and measurement of customer outcomes. This includes dynamic tools for the structured assessment and categorisation of communications that can link touchpoints and journeys to specific outcomes. These new tools enable visibility, tracking and effective outcome management across large complex comms estates - an important development in this new outcome-driven world.

Find out more

You can download the full report here: Better Outcomes for Digital Customers

Please get in touch to learn more about embedding outcome-driven best practice in your organisation.

*Sheldon Mills – Executive Director, Consumers and Competition (FCA).