In a time of shaken financial confidence and economic uncertainty, customers are taking a closer look at the financial services institutions (FSIs) they do business with. A new Salesforce report finds that in the past year alone, a sizable number of customers have switched banks (25%), insurance providers (35%), and wealth managers (34%) — and finds digital experience and empathetic service may hold the keys to why.
The Salesforce Connected Financial Services Report is based on a survey of over 6,000 financial services customers worldwide that sought to uncover trends reshaping the industry and why they are occurring at such scale and speed. The report captures the importance of personalization, empathy, and digital experience, as well as evolving sentiment around disruptive technologies like artificial intelligence (AI).
Below are some of the report’s key findings.
Guidance and support fall short amid economic uncertainty
Customers are experiencing decreased financial security compared to last year and feel financial service providers have not adequately prepared them for the moment.
Just 28% of customers worldwide feel more financially secure than a year ago, while 42% feel less secure. Unfortunately, an overwhelming majority (79%) say their financial service provider did not fully prepare them for an economic downturn, while over a third (37%) say their FSI did not help them at all.
Compared to younger generations, older generations are more likely to be less financially less secure than a year ago, and are also more likely to feel their FSI did not adequately prepare them for the moment.
Notably, when it comes to customer perception of empathetic treatment, there is a discrepancy between wealth managers and other sectors. Sixty-three percent of customers say their wealth manager has treated them with empathy during this time. In contrast, less than half of customers feel their banks and insurance providers did the same.
“Trust is paramount in financial services,” said Eran Agrios, SVP and GM, Financial Services at Salesforce. “Making financial experiences more relevant, accessible, immediate, and personalized goes a long way toward building loyalty across all populations. Particularly in a climate of financial uncertainty, proactive outreach and personalized care are key to retaining customers. Institutions that fail to take full advantage of available tools, such as AI, data, and CRM, risk losing clients to competitors who do.”
Making financial experiences more relevant, accessible, immediate, and personalized goes a long way toward building loyalty across all populations. Institutions that fail to take full advantage of available tools, such as AI, data, and CRM, risk losing clients to competitors who do.Eran Agrios, SVP and GM, Financial Services at Salesforce
Subpar digital experiences drive customers away
Macroeconomic uncertainty is not the only concern for the financial services industry. Over the past year, customer churn has been an ever-present threat.
What’s luring customers away? Across sectors, customers are switching to FSIs that can provide better digital experiences.
- Banking: Most customers prefer to apply for common banking services digitally, including debit cards (72%), credit cards (71%), and savings accounts (69%). Excluding price, digital experience is the top reason globally for switching banks.
- Wealth Management: Digital experience also tops the list of reasons for switching wealth managers, tied with seeking better integrations with other services. Sixty-one percent of customers prefer to manage investments digitally.
- Insurance: Most customers prefer using digital methods to purchase coverage (60%), renew it (60%), or adjust it (61%). Digital experience is the second-highest reason for switching, after customer service.
When asked about digital experiences they find frustrating, 39% of customers point to poorly functioning chatbots. After chatbots, the most commonly encountered areas of friction include difficulty finding information online (29% of customers), inconsistent customer support (28%), and impersonal service (24%).
“Recent years have seen a rapid roll-out of technologies across the financial services industry,” said Agrios. “We’re now at a time where FSIs are refining those experiences, doubling down in the areas where they’re seeing the most success, and listening closely to their customers. The most successful companies will be the ones who can harness their data to provide an experience that is not just intuitive, but personalized and relevant.”
AI is key to personalization at scale, but customers remain unsure of its benefits
Given the high stakes and long-term implications inherent in financial decision-making, personalized services from FSIs are a necessity, not a nice-to-have. Sixty-two percent of customers say they would switch financial services providers if they felt treated like a number, not a person.
Data from a separate Salesforce study shows 76% of financial services employees believe generative AI will help them better serve their customers, due in no small part to its personalization capabilities. Fifty-six percent of employees say it will transform how they personalize content for customers.
Despite the value of AI in creating personalized experiences at scale, the new data shows that financial services customers aren’t yet comfortable with the technology.
Case in point: Financial services customers feel some unease about chatbots that use generative AI – just 21% of customers say they fully trust these types of chatbots. A full 56% are unsure and 23% do not trust them.
Unfamiliarity with AI may explain some of this doubt. While many customers feel optimistic about AI’s time-saving potential (46%), nearly as many (40%) have yet to form an opinion.
Research suggests data security and ethical guidelines as a path forward for companies looking to bridge the trust gap:
- Security controls: 78% of financial services customers state that they would switch their FSI if they felt their data was mishandled, showing that clear data security protocols are essential.
- Customer control: 60% of customers say they would better trust AI if they had more control over how it’s used, according to prior research.
- Read the full Connected Financial Services Report here
- See how Salesforce is delivering the future of personalized finance with AI, data, and CRM here
- Learn about Salesforce Financial Services Cloud here
- Find additional Salesforce research here
Unless cited otherwise, data is from a double-anonymous survey of 6,058 financial services customers from Australia, Brazil, Canada, France, Germany, Japan, Mexico, New Zealand, Singapore, the United Kingdom and Ireland, and the United States. The survey was live from March 7, 2023, through April 12, 2023. All respondents are third-party panelists. Additional information can be found in the report.