Man improving customer engagement by messaging his bank on his smartphone

Improving Customer Engagement with SMS Communications in the Financial Sector

Published August 09, 2018 by Alyssa Mazzina

The key to engaging customers, avoiding increased calls to the contact center, and providing clients with the right tools to manage their accounts might just be in the palm of their hands. As smartphone ownership matures, increased numbers of consumers readily accept secure mobile messaging as part of the mobile customer experience. With more users becoming comfortable with mobile app alerts and even text messages from brands, financial services providers are taking advantage of new opportunities for improving customer engagement.

An Opportunity for Improving Customer Engagement

Simply put, smartphone owners use their devices a lot. Recent statistics put this fact into perspective, suggesting just how embedded into our daily routines our smartphones have become. According to the 2017 Deloitte Global Mobile Consumer Survey, 89 percent of smartphone users check their devices within one hour of waking, while 81 percent check them within an hour of going to bed. And perhaps surprisingly, the data doesn’t skew younger. In fact, the frequency of phone use among older generations is equal to or higher than that of other groups in this study.

In addition to using their smartphones to stay up-to-date socially, a Bankrate survey found that almost two-thirds of smartphone users have at least one full-service banking app installed. Respondents said they use banking apps to manage their bank accounts, with 70 percent of users checking on their accounts once a week and 16 percent checking on them daily. With mobile banking becoming part of regular online activities, financial institutions are beginning to turn to SMS communications to connect more directly with their customers.

By taking advantage of the ability to reach consumers conveniently through SMS messaging, banks can do something new: provide time-sensitive updates and reminders. Through secure SMS messages, banks have a convenient method of delivering notices about approved transactions or alerting customers to potential fraudulent activity. These messages can be automated to coincide with regular account updates or to respond to triggering events, such as suspicious account login attempts.

These kinds of alerts not only keep customers better informed about their accounts, but they also set the stage for a better customer experience. Instead of leaving customers to attempt a purchase, find that their card has been disabled, and then call the bank to sort the problem out, SMS notifications can streamline the process, alerting the customer of the situation and putting a solution in motion before frustrations or complications arise.

Beyond Account Alerts: Thinking Big

A 2017 IDC report on the role of messaging in mobile retail banking found that customers readily accept SMS messaging and even expect it to be part of the overall mobile experience. But SMS messaging expectations reach further than simple SMS alerts. The majority of customers are comfortable with standard messaging and look for two-way SMS communications. Integrating SMS into the existing mobile experience can help deliver not just the mobile banking experience that customers expect, but one they’ll value. Consumers are more willing to remain with a financial institution that delivers an effective, easy-to-use messaging experience, associating the brand with innovation and convenience.

Alerts can be sent out in real-time or based on business logic, such as when a customer’s account goes below a certain balance. Two-way communications can be established by allowing the recipient to reply to alerts with requests to reschedule appointments, resolve simple account issues, or to reach a customer service agent. SMS responses can even be routed via IVR or to voice-based customer service based on conditions that may include time zone and operating hours. Private and secure messaging helps brands to connect with users when they need assistance—all in a context that is convenient and natural for them.

SMS also offers an additional channel for brand marketing content where customers can receive targeted offers or rewards for loyalty activities. Retailers currently use SMS to alert loyalty-program members of a new level of achievement, send coupons, or offer special member discounts. While financial sector usage is centered around account-related events, it can also support additional marketing activities—for example, highlighting suggested products or special financing available only to select members.

Connecting regularly used mobile applications to SMS messaging offers a vital way to improve customer engagement by providing users with more opportunities to interact with an institution or brand. Financial institutions that offer dynamic messaging beyond simple alerts have an opportunity to engage with customers in a seamless, intelligent way. And with digital engagement, each additional touch point is another opportunity to build trust. When customers regularly interact with a brand in a positive way, they’re more likely to stay.

Customized contextual messaging can make life easier for customers hungry for a high-quality customer engagement experience. A disconnected and uncoordinated approach simply won’t do—but providing the right information at the right time can make all the difference for your customers.

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