Experian QAS: current contacts – Colin Rickard
The mix of channels through which customers choose to interact with their banks has changed over the years, with the overriding trend being the growing preference for digital channels. Achieving consistent service and personalising customer banking experiences depends on having a single customer view. This idea has been discussed in the banking sector for years but, so far, little progress has been made.
"In terms of getting a single view of the customer, not much has happened among banks," says Colin Rickard, enterprise and channel sales director at Experian QAS. "I've worked in this area for 30 years and I thought it would be a five-year career because I expected everything to happen quickly, but senior executives see it as something that is hard to do, costly and does not have enough clear benefits."
Accurate customer risk assessments
Experian QAS focuses on helping clients achieve better data quality, providing an extensive range of software and solutions, supported by a vast array of referencial data sources. It recognises that correct business decisions stem from accurate and reliable data, and that creating a single customer view not only improves customer engagement, but also unlocks
The company's primary areas of expertise are in delivering the technology and services necessary to help organisations use their customer contact details effectively. Experian QAS can help to mitigate the risks of inaccurate data and the inherent cost implications. These solutions have been developed and certified for use within leading applications from organisations such as Microsoft, Oracle and SAP.
"Should data about customers be accurate?" says Rickard. "People will say 'of course', but in practice, who owns that issue? What does 'right' look like? In banking, a single view of the customer is the Holy Grail.
"For example, when a bank is making a lending decision, it needs to know who or what it is lending to and what the customer's risk profile is. The value is in the ability to make an accurate, customer-based risk assessment. If there is no unified view of the customer, then a bank is likely to lend on a very conservative basis."
In an era when banks are, on the one hand, being encouraged to lend to boost the economy but, on the other hand, being told to be more careful about balancing risk and capital, a more informed and complete view of the customer would be invaluable. On top of that, there is regulatory pressure for banks to know their customers better in order to prevent fraud and money laundering.
"To be able to lend more accurately is a potentially huge advantage, not only from a regulatory perspective, but also from the point of view of customer service and perception," says Rickard. "There are so many reasons why banks should do it."
Improving customer data: why and how
There is a host of reasons why banks should generate a more holistic view of their customers. Among the most important is customer loyalty. Surveys by Experian QAS have revealed that over 84% of consumers would take their custom elsewhere if they experienced the negative effects of poor customer understanding.
Customers are likely to walk away if they are dealing with companies they feel do not listen, bombard them with marketing messages for products that are not relevant to them, or contact them through channels they have specifically marked as not being preferable. If an organisation fails to engage appropriately with its customers, then customers will simply refuse to engage with the business.
Customer data is easier to gather, but it is also much simpler for customers to access and engage with competitors who use that information to develop better and more appropriate services. If a company does not extract value from its customer data, then it will lose its customers' attention. The big question, therefore, is how an organisation can achieve a single customer view and extract the greatest value from customer data. The answer begins with looking at the data it already has.
"Banks are working hard to get their customer files in better shape," explains Rickard. "They have lots of data, but much of it is old, so there are challenges around getting into the right format. First, the link needs to be made in their minds that a unified customer view underpins regulatory requirements, know-your-customer processes, customer service and naturally improving business processes.
"That unified view is very hard to achieve. If it were cheap and easy, it would have been done already. The volume of data, the complexity of its sources and often the age of the data is a challenge, but so is the issue of who has ownership of it - who owns a customer in a bank?"
A key decision for banks is who should be responsible for data governance. The data within a bank is the bedrock from which the knowledge about a customer is derived - this is what influences a business decision, and it makes sense to have someone in charge of managing that data. It is all too easy for data governance issues to fall into the cracks between different departments in any large organisation, so it is of great use to create a single, unambiguous role in the organisation to deal with data.
"We are seeing some data governance programmes established and there is a growing number of data quality initiatives," says Rickard. "There is the possibility of a new role emerging - that of data governance inspector - though we haven't see many yet. When we talk to a company about our software, services and knowledge, we need the right person to talk to.
"Banks understand the value of their data in principle, but they often need to widen their view of how to manage it. For banks with tens of millions of customers whose preferred channel of the future is digital, a data governance programme will make a big difference."
Experian QAS: the experts
Experian QAS is often called on to help companies verify contact data, and addresses are a priority for many of its clients. So far, there is less focus on the verification of digital addresses - mobile phone numbers and email addresses - even though these are essential for the delivery of services through digital channels.
"A bank could easily extend the principles of address verification from one set of reference data to another data source," explains Rickard. "That is the importance of a data governance programme - to get the data right at the point of entry, then extend that principle to other data.
"That's the way we do it. A bank sees the benefit in one area first. It is a bottom-up approach, starting with specific bits of data and then working up. Banking has a lot of top-down projects that slow down or fail, but they should treat data governance as more urgent than that."
Data governance programmes could be driven by banks' existing digital programmes, through which they are already asking themselves what banking will look like in the future.
"We provide a combination of external data reference, software and decades of data management experience, which enables data governance and addresses data quality," says Rickard. "We have the people, the processes and the solutions. We can deploy data reference in real time so that you can check the accuracy of data at the point of entry.
"We see a steady flow of financial institutions asking for this, especially as digital services become more important. We have a big presence in financial services, where the focus is on expanding from contact information to data governance in a broader sense."