Saturday, October 31

Blockchain Customer Engagement for Bank CIOs to Watch

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Banks are willing to invest in blockchain customer engagement solutions to enhance their services and increase up to 20% revenue in return.

Blockchain Customer Engagement for Bank CIOs to Watch

Sale is not a single interaction or a touchpoint, it is a journey. In this journey, customer acquisition or ‘sales closing’ is significant to the banking sector. However, a smart bank manager knows that the second part – customer engagement is much more challenging but worthy of building a long-term relationship with customers. Blockchain technology plays a critical role in this process. Bank CIOs have realised blockchain’s prominent features of decentralization, immutability, transparency. Many of them have already invested in different blockchain customer engagement solutions and achieved impressed reverberation.

How can blockchain enhance customer engagement in banks?

According to PwC statistics, 85% reputation of a brand generates from daily interactions. These are the experiences between the bank with their customers. To enhance customer engagement, banks have to offer their customer appropriate services, which lead to great experiences in both channels: online at the website, fan page, and mobile app and offline at branches and transaction offices.

In order to enable the mission, they have to understand their customers as well as their behaviours. Blockchain customer engagement solution has a great impact to complete this challenge by following ways:

  • Better customer services: Customers always look for better services: cheaper fees, quick support, easy-to-find answers, and convenience… Blockchain and smart contracts have the potential for banks to build-up real-time services. For instance, with already-verified data on the system, there is no need for customers to wait in line at the transactions office to submit the documents. They even only need their phone or laptop or any other smart device to submit and complete the procedures. Not only cut off the cost of wasted procedures, but blockchain also reduces the cost for each transaction. This is the one first thing that customers may be concerned about to remain in a relationship with a bank. 
  • Experience of high security and transparency: According to new Accenture 2019 research, “banks, capital market firms and insurers grapple with a per-firm average of $18.5 million annually to combat cybercrime, over 40% more than the average cost ($13 million per firm) across all industries surveyed”. Blockchain, using cryptographic algorithms with the security of military-level, has a nearly zero chance of being hacked. Personal data and privacy are safe with blockchain CDP platforms. 
  • Revolution of trust: In the banking sector, credit means trust. But this “trust” is not based on emotion. It is a trust built on a practical basis: To a bank, trust comes from a good reputation, a prosperous business, guaranteed papers and the law; to the borrowers, trust comes from the ability and intention to pay the debt, collateral, and legal base. Blockchain offers a reliable database with immutability and transparency for banks to harness quality information and gain benefit from that. 
  • Deliver better-personalized services and create a strong connection between customer and bank’s products: Consumers expect good targeted and personalized communication. They are getting smarter and showing a desire to get more benefit from their provided personal information. It is such a tragedy if a bank data and information system are too bad to handle the potential. This, however, won’t happen in a blockchain CDP platform, because blockchain records all information in a single ledger linearly and immutably. The data is here to stay. 

According to The financial brand, customers who are fully engaged in a bank have a higher intention to expand their needs to use other services of this bank than actively disengaged ones. 49.6% of fully engaged customers said that they will increase the balances of their existing account compare to 4.4% of actively disengaged ones. 

Banks should consider the value of a good engagement customer program as well as harnessing the potential of new technologies if they want their customers to use and spend more on their financial services.

Blockchain customer engagement solution for bank CIOs by akaChain

A quality customer engagement includes two factors: Good experiences and the repeat of these good experiences. Any enterprise can build a customer loyalty program, but with …% of failed customer loyalty programs, it is not easy for any bank to build up a customer loyalty program that truly works. 

akaChain, setting the vision of harnessing and implementing the real-life potential of blockchain for enterprises, always aim to build blockchain-based customer loyalty solutions that optimize both quality and cost. VPBank, one of the major and dynamic banks in Vietnam, has trusted and used our solution.  

Our ambition is “blockchain can enhance customer loyalty programs and akaChain optimizes blockchain solutions”. It means that akaChain blockchain solution not only brings in above positive impacts to banking customer loyalty programs, but it also has to be in accordance with the banks’ wishes and their actual conditions.  

At the webinar “Enhancing customer experience and retention” – One of akaChain’s webinars/seminars on DX and blockchain technology development for enterprises, Mr. Duong Nguyen, president of CEMPartner – a certified customer experience specialist, shared “Customers are not loyal to you, but they are loyal to the experience that they have with your brand and services.”

Therefore, our outcome blockchain solution will start with improving the current bank loyalty system. This means that customers will retain their interaction with the bank through existing channels, especially online channels with technology applications (on customer mobile devices or other electronic devices at bank offices). The manipulation is still retained and even simpler since the procedure might also get simpler. 

akaChain understands that adopting new technology is expectedly costly. Therefore, with our technology advantage base, we provide our solution with SDKs to run on any cloud in a short time (more or less than one month) to have a first-stage product for banks to test the effectiveness. 

As a for-profit business, we understand that troubles will show up when the flow of value stops without any add-value created. But the flow of value will not end with blockchain. By expanding customers’ ability to use loyalty points, the bank will grasp where the value flow is headed and focus on this path. 

The expected results are first, customers have more great experiences and more value-added services; second, banks control better their customer information system and offer appropriate services to a certain customer then increase revenue. Customers want convenience when using one bank for different financial needs (86% of them are willing to pay more for a better experience) and in contrast, when customers use more bank services, the less likely they are to switch to another bank. In-depth, Deloitte statistics on blockchain in banking show that there are 27% increase in the volume of transactions and 5% average savings on purchase transactions.

“95% of dissatisfied customers will tell other people about their bad income but not to you. That means only about 4% – extremely low – will tell you their experience.” Passive management companies make their decision with this pathetic 4% and lose their customers, proactive companies seek for the transformation in the long run.

About akaChain

akaChain is backed by FPT Software, a globally leading technology, and IT services provider. It is an end-to-end, permissioned, multi-chain network based on the Hyperledger Fabric. Since Establishment in September 2018, akaChain’s product has assisted many enterprises, from SMEs to Fortune 500 firms, to transform with distributed ledger technology. The company provides a broad range of permissioned blockchain-based products and services in multiple sectors, including retail, supply chain, banking and finance, insurance, shopping mall management, etc. to transform with its distributed ledger technology. For more information, please visit https://blog.akachain.io/.

Contact us for more information: 
Website: https://akachain.io
Phone: +84 90 1133883
Email: admin@akachain.io
Addresses: FLC Twin Towers, 265 Cau Giay street, Dich Vong Hau ward, Cau Giay district, Hanoi, Vietnam.

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