Finance and CRM in Germany

Findings from a survey by GfK in Germany, in which over 1,500 users of financial services offered on the Internet were questioned, shows that the high expectations financial services providers have of electronic customer relationship management systems (e CRM) can never be wholly met.

This has nothing to do with poor performance of the systems or unprofessional websites. The real problem is that the focus of many financial services websites are not responding to the needs of online customers.
In recent years, the Internet has become a major information and sales channel for the financial sector. In 2001, 17 million users chose to bank online and over two million managed their securities accounts online. In the same period, around 9 million Internet users (28 per cent) visited insurance company websites for information. Given the rapid development of the Internet, the financial sector was keen to offer this platform as an alternative to its customers, using a suitable customer relationship management (CRM) system.

Overall, it would appear that CRM-based online offerings stand little chance of success. Customers are not currently basing their selection of an online financial services provider on the look of its website. Presentation of the information and offers alone are not enough to convince customers to go with a specific company and this applies equally to all kinds of financial services. Customers base their decision about whether to use or stay with a company on far more traditional criteria such as more favourable prices, the existing customer/company relationship and the image of the financial services provider concerned. Security measures, quality of advice and additional services provided via the website are less important. This means that e-CRM systems alone are of little consequence to providers of financial services when it comes to generating new business.

The findings of the survey suggest that e-CRM as a customer loyalty instrument only works if the following customer expectations are met:

• Customers of banks and direct brokers see the Internet as a means to save cost and time. Their expectations therefore focus mainly on the usability of the tool, whereas aspects concerning the content such as range of products, information and entertainment (online chats, prize draws) play a comparatively minor role and contribute little to customer satisfaction.
  
• With regard to insurance companies, the picture looks somewhat different, with insurance companies' websites being used significantly more as a source of information. As a result, in addition to usability, content is a contributing factor to long-term customer satisfaction.
  
• The personal touch, a tailor-made product offering and the possibility of customizing a website are less important from the point of view of customers. The same applies to the typically comprehensive presentation of the company and other information.

Most websites of financial services providers do not meet these criteria and accordingly, at 40 to 50 per cent, customer satisfaction in this area is low. What customers find lacking in particular is detailed information on products, terms and prices as well as the option of making various calculationd based on different rates.

However, the interesting fact is that the relatively low overall satisfaction with the website used appears to have little influence on customer satisfaction. If they had to go back and choose again, most customers would choose the same provider and recommend the company. This is obviously due to the fact that the overall satisfaction arising from an already existing customer relationship and the general benefits of the Internet as a medium such as ease of use, speed and cost savings are decisive factors.

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.

• GfK Germany
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