Making the most of “Europe 2020” Through Customer Engagement
The finance industry is eagerly awaiting the European Union’s “Europe 2020” strategy, which is set to come into action this summer.
In particular, its focus upon the removal of contract-related barriers to cross-border financial trade is expected to open new channels for conducting business. But what will this mean for wealth managers across the continent?
The new rules are designed to remove obstacles to competition, as well as the heavy and inconsistent burden on the ability to expand services. These don’t, however, guarantee success. The ultimate success of wealth management companies will be largely dependent on how well they can engage with individual customers across Europe. The industry must continue to focus on reaching and engaging with customers no matter how long they have had a relationship with the company or where they are in the continent.
Balancing old and new
The easing of cross-border trade will mean that companies have the potential to make the most of Europe’s 733 million inhabitants. Despite the likely increase in business volumes, companies can’t let communications with existing and potential customers slip. They need to ensure that people are fully engaged whether they have been a customer for five days or five decades. Let’s say a wealth management company gets distracted by the prospect of an influx of new customers and, to save time, emails all existing and potential customers with a special welcome offer. The company risks alienating existing customers who may find the use of email intrusive, and who could be tempted to take their business elsewhere; meaning the business must recruit more customers simply to break even. The importance of the customer as an individual cannot be ignored, regardless of when they joined.
Crossing cultural borders
However, successful customer engagement goes way beyond sending customers the right emails. Wealth management companies need to acknowledge that there are many factors in play. For instance, ensuring that language and cultural references are relevant to the individual customer is crucial. It might seem obvious, but wishing an Austrian customer a Happy Fiesta Naciònal de España, or expecting a Spanish customer to respond during Three Kings Day is a swift route to alienating the audience. Similarly, while some customers may be comfortable with communications via letter or email, others will appreciate a more modern approach, e.g. via SMS or a mobile app; indeed, according OnReach, 64 percent of consumers would prefer text over voice as a customer communications channel. Balancing these needs, and doing so across an entire continent, could test the limits of many organisations. As a result, many will be forced to look to technology to ease the transition.
Entering the digital era
Digitalisation has attracted a negative reputation from many businesses; seeing it either as a mere trend, or as an upheaval that will force them to completely overhaul existing legacy systems. Yet digitalisation is key to giving wealth management companies the ability to truly communicate with customers, wherever they are, whenever they joined, and however they prefer to engage with the business. At the same time, customers of every generation will come to expect digital communications as a matter of course. Digitalisation is more than just a trend, but it also doesn’t need to mean a completely overhaul of legacy systems. Instead, companies should look to technology which adapts to existing legacy systems and content, allowing consistent communication across all channels. This will allow communication to be more frequent, more targeted and more interactive, delivering customers the information that matters most to them; whether that’s their own portfolio or the current cost of shares.
Are you ready for the challenge?
With new rules set to come into place, wealth management companies will find themselves in a favourable yet challenging environment. This will require companies to consider how they will engage with their customers on a much larger scale. The industry needs to engage with each and every customer, from London to Limassol; ensuring that the customer is satisfied across their entire journey with the organisation. Only then will the industry be able to make the most out of the “Europe 2020” strategy.