Are banks facing their own ‘Kodak Moment’?

Many organizations are partnering to leverage big tech’s digital expertise. Others are playing the waiting game, to avoid collaborating with what might become their most deadly competitor. Where do you stand?

Antony Jenkins, the former chief executive of Barclays, warned that banks are facing their own “Kodak moment” as they face similar challenges that the film company faced when refusing to move with the times.

“Banking will be shaken up by the combination of artificial intelligence, the internet and distributed ledger technology, such as blockchain, which will do away with the need for central counter-parties on transactions. And while banks hire tens of thousands in their technology arms, often they are mostly maintaining legacy systems.”

Are these fears overblown – or should banks fear they might get left behind?

Technology isn’t the big issue

First, consider that according to the latest CXMB Financial Services report, despite historic levels of investment by banks, while 30% of customers believe that resolving issues has become easier over recent years, 32% believe it has become more difficult.

The results sound pretty evenly mixed – until you take into account that 57% of customers reported that they had moved some or all of their business from a bank as a result of a poor customer care experience.

The fact of the matter is that legacy business models are under threat. And yes, emerging competitors, including venture capital-funded fintechs and tech giants like Apple and Google, are threatening banks’ market share and disrupting the expected ways of doing business that have underpinned the industry for the last 300 years. But a look at the bigger picture shows that banks need to close the gap that exists between what they offer and how well those offerings actually meet customers’ needs and expectations.

It’s the technology/service gap

The CXMB survey results conclusively show that today’s customers expect to engage on their terms and in the channel of their choosing. Where this need is not met, customers are significantly more likely to rate their experience as a negative one - and as the responses above indicate, they often seek out alternatives.

While banking customers overwhelmingly prefer to speak on the phone to resolve issues, the frequency at which they pick up the phone isn’t always by choice. The responses below indicate that customers would prefer to use digital channels such as online chat, email, texting and self-help (such as online knowledgebases), but are presumably forced to resort to a phone call to have their needs effectively satisfied.

(Source: CXMB Industry Insights: Financial Services)

The disconnect between channel availability and channel efficiency is also borne out in perceptions of where banks have made strides and where they still need to catch up. While customers cite “Technology” and “Service” as banks’ No. 1 and No. 2 respective biggest improvements in recent years, they also point to “Service” as the No. 2 area where banks need to focus in the future. (“Service fees” was ranked No. 1 for this question.)

Navigating increased customer expectations

So, are banks facing a Kodak moment? While it’s true that customers are often lured by the promised speed, convenience, and efficiencies brought about by technological innovation, you can make the case that first-mover advantage is ultimately finite because legacy organizations have the resources to replicate or acquire new technologies in order to level the playing field.  What matters is meeting customers on their terms, in the channel of their choosing, and avoiding the poor experiences that lead to disloyalty and switching. For more than 20 years, VXI has been providing highly specialized services for banking and financial services clients.  We can help you navigate the change ahead.

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How to deliver faster, more effective CX at a lower cost

Delivering a fast, effective, outcome-driven service experience, for the greatest possible margin, is the holy grail for organizations. But while the desire is there, the reality is vastly different.

Look no further than Forrester prediction for customer experience (CX) initiatives in 2019:

Stagnating CX quality will cause short, destructive price wars. Up to 20% of companies will throw in the towel and give up trying to differentiate on the basis of CX. Instead, they will just try to not get worse and resort to price cuts to grow.

While the financial reality of providing a service cannot be discounted, in our view there is a huge opportunity for organizations to both increase the quality of outcome you deliver AND generate more revenue in the process.

Technology, in and of itself, does not drive out cost or result in productivity gains, as the graph below demonstrates.

There is a huge disparity between what clients would describe as ‘ideal’ in terms of service delivery, and the economic reality of providing it. Technology, despite the promise it holds, does not come cheap. The combination of inflexible legacy systems with the high cost of change and development makes the case for change hard to justify. And that’s before you even consider the changing nature of customers themselves. How is an organization supposed to keep up with customer preferences when the cost of change is so high?

The reality is that in order for organizations to cross the chasm between customer need and viable operations, a new approach is required.

Organizations are in a bind because the numbers don’t stack up – which isn’t sustainable. A new approach to channel management is required that flips this on its head.

Today, it is possible to actually serve more customers, and deliver better outcomes at a much lower price point.

The key is adopting a more flexible approach to technology. One that doesn’t rely on ‘owned’ servers or investment-heavy change processes. One that leverages best of breed capabilities from multiple vendors, rather than a single tech stack that restricts your options. One that can be delivered in hours and changed in minutes, without the cost typically incurred from change.

One that allows you to stay ahead of your customer’s needs – at a superior price point to what you are used to.

We know this because we’ve been working with our clients to deliver exactly this type of solution. We very much look forward to exploring what this can offer to your business.


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Three customer-care conversations you need to have in 2019

In the era of customer obsession, the experience we deliver customers is the new battlefield on which organizations are competing. Once the “uncool kid” of the party, the contact center has found new fame in heralding the customer journey – and customer service experts have become pivotal to the experience, employing new tools and technology to give your customers what they need, when they need it.

But if there is one thing we know, it’s that ever-increasing customer expectations, in tandem with an exponential increase in the rise of technology, are driving the shift to an entirely new model. It’s not a case of bolting on technologies to the existing model – but one of ongoing, fundamental change.

In the foreseeable future, the contact center will continue to hold a vital position in the intersection between the organization and the customer. But the way it operates, the very role of an agent, the jobs they do and the ways they interact with customers will change radically.

McKinsey predicts that by 2030, 800 million jobs could be lost to automation. Some questions that we ask ourselves daily at VXI include:

  • What role does the agent play in the future of the customer experience?
  • How will the customer expect to interact with organizations in the future?
  • What technologies should we be investing in today to prepare us for tomorrow?

While we could write volumes on the changing space that is customer care, here are three key changes that we see impacting the future of our industry.

From ‘care’ to ‘experience.’

The contact center has the opportunity to become the organizational hub for all customer interaction. Today’s customer experience is often siloed, and disjointed across many departments, causing a mishmash of customer journeys - resulting in customer confusion.

Much like the evolution from the call center to the contact center to accommodate the creation of new digital channels, the future will see the creation of the “Experience Center.” Combining both proactive roles such as customer success with traditional reactive roles, the experience center will focus on ensuring that customer experience is enhanced as your service is used. The key? Personalized, tailored services, driven by analytics to deliver a truly unique (and valuable) service.

The Internet of Things – and the channel-less customer experience

With 24 billion IoT devices predicted to be in the world by 2020, it’s easy to see that the once clear lines between face to face, voice and digital are gearing up to blur even more as technology advances. Where does this leave the future of the contact center?

It’s no longer just chatbots, artificial intelligence (AI) and virtual reality (VR) on the horizon – customers will expect to interact with organizations when they want and where they want. And no matter the channel, customers expect a seamless interaction. What happens next as we move from omnichannel to channel-less customer experience?

Technology: an enabler, but also a potential dead end

Increasingly technology has a role to play in augmenting agents’ capabilities. But while the promise is great, this creates a quandary for those in customer care. How to choose where to invest? It’s important to remember that choice of technology stack will either hinder or amplify your ability to meet future customer need. Today its chatbots – tomorrow its voice search and AI. And then… who knows?

Technology stacks that put you on a single development path and limit your future options are to be avoided. Adopting a more flexible approach that ensures you can change as your customers change is the key. It’s for this very reason that we’ve partnered with a breadth of technology providers – giving us the ability to pick the right solution for the right or swap it out when it makes sense to do so.

We know things are set to change, and we’re proactively working toward the future of customer care with our finger on the pulse of the ever-evolving customer.

While no one can predict the future, we believe you need to be working with a partner that’s in the trenches of change. If you’d like to work with a partner that’s up to the task of helping your organization stay ahead, talk to us.


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Going from omnichannel to channel-less CX

We’ve come a long way since Henry Ford (reportedly) declared, “Any customer can have a car painted any color that he wants so long as it is black.”

Flash forward to PayPal CEO Dan Schulman asserting that in 20 years there will be no more credit cards: “Everyone will have a smartphone, enabling consumers to have "full connectivity at a very low price."

It’s an empowering time for customers. For those of us in the customer care space, there’s an interesting challenge: How can we prepare for the future of the customer experience (CX) when we don’t even know what that looks like yet?

What we do know

With more than 40 billion IoT-enabled devices predicted to be connected to the Internet by 2022 in the U.S. alone, the once-clear lines between face-to-face, voice and digital are gearing up to blur even more as technology advances. Omnichannel customer experience isn’t an option - it’s a mandate.

With technological adoption, customers expect to interact with organizations when they want and where they want - and no matter the channel, they expect a seamless interaction.

You can consider this a challenge, or you can consider it an opportunity.

Consider a basic (often unmet) expectation for a hotel guest: to be able to interact with her room as easily as she does with her home. Now consider that 13% of U.S. households have smart thermostats. The data that an IoT-enabled thermostat collects on a guest’s temperature preferences could be used to ensure a welcoming environment when she arrives at her room.

We’re in the omnichannel age today – and it’s no longer just chatbots, artificial intelligence (AI) and virtual reality (VR) on the horizon. How long until we get to channel-less?

At VXI, I’ve helped numerous clients navigate and leverage both the opportunities and challenges they were seeing – and weren’t seeing - to drive a superior CX for their customers.

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How to understand and leverage your digital opportunities

I came across this analyst perspective on Toyota’s $1 billion investment in Singapore-based Grab Taxi Holdings:

“Ridesharing is coming. For car companies, this is a painful reality. But it can be a business opportunity if they understand it correctly.”

Toyota is, of course, an automobile manufacturer driven by technology. Grab, while known for its ride-hailing, ride sharing, and logistics services, is essentially a technology company.

Meanwhile, as players like Uber and Lyft have signaled their intentions in what was traditionally the rental-car space, upstarts like Snappcar, which allows customers to rent out their vehicles, have entered the market.

Which begs the question: Where does this leave rental-car companies?

I’ve always said change is good. It can be stressful when it’s nipping at your heels - but when technological evolution and innovative ideas collide, your path can lead toward transformations in customer experience (CX) and expectations.

But change and innovation are also hard. According to McKinsey, 48% of digital investments fail to deliver ROI.

Bridging the conversion gap

The reason? In my view, there remains a gap between the promise that digital initiatives hold, and the ability of organizations to truly operationalize their strategy in a way that ensures their ROI improves at the same rate as the experience they deliver. I term this the conversion gap – the difference between an experience that will drive increased revenue and loyalty from your customers, and the ability of an organization to viably deliver it.

Leaping this gap requires a different approach – one that’s driven by an understanding of customer behavior and impact across all channels, and backed by a flexible, responsive approach to technology deployment that allows you to deliver the experiences that customers want, within the channels that deliver the best return to you.



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How to get your organization wired for agile CX

This prediction is particularly salient today:

“Companies that adopt new capabilities to be more agile, responsive and innovative will not only thrive but are also 3x more likely to achieve above-average revenue and profit growth.” Accenture, 2018

Of course, there’s a flip side to this story: Accenture also estimates that in the U.S. alone, the estimated cost of customers switching due to poor service is $1 trillion.

Customers no longer view their experiences in silos. They expect the same degree of flexibility they already get from leading tech companies like Google, Amazon, and Apple. The ability to change, grow and innovate – at speed – to keep up with today’s consumers is a requirement, or organizations risk drowning under the weight of their own legacy.

Shedding the legacy systems – flexibility is key

With non-traditional innovators like Airbnb and Uber injecting the market with new business models and platforms, you can’t afford to remain tied to legacy systems that lack the agility required in today’s world.

In our view, the key is having a singular focus on today’s customer and their needs - while continuing to invest in experiments that guide tomorrow’s development of integrated solutions, whether the focus is on IoT, AI or your basic chatbot.

Of course, your front-line agents also play a critical role here - in both assisting customers and gathering valuable data on the success (or otherwise) of these experiments. As even Rurik Bradbury of the mobile and online messaging provider LivePerson concedes, “The big mistake with chatbots has been imagining they could suddenly take the entirety of a conversation and just work by magic.”

Data is the lifeblood of innovation. It’s vital that customer behavior in all channels is captured and translated into the actionable insight that determines future direction. With two decades of continuous innovation of our tools and technical capabilities, VXI can help you engage, delight and retain your customers.

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Do your partners ‘get’ innovation? Ask these four questions

While innovation from within is crucial, I’d go even further to say you need to be pioneering innovation across your entire value chain.
When it comes to your partners, there’s no question that delivering on your numbers is important – it’s what we do every day. But frankly, hitting your number is merely table stakes.

Here’s what you need to be demanding of your partners in 2019:

1. Understand that there is no such thing as customer satisfaction

Satisfaction is a temporary illusion at best. Today’s satisfaction is replaced by tomorrow’s new market innovation that your competitors are already two steps ahead on. True innovation occurs by solving the problems that customers don’t even know they have – and satisfaction is merely a mediocre trap where complacent organizations are overtaken by those that have a true focus on customer centricity.

2. Handle the rapid revolution in the customer journey

We know we’re wasting our breath explaining the importance of the customer journey – we all know how important this is. But the reality is many partners don’t understand that we’re sitting on the tip of the iceberg when it comes to how we interact with our customers. With the rise in the omnichannel customer experience in full swing, we need to be looking toward the future of the channel-less customer experience as IoT takes shape. You need a partner that not only understands this but also has the ability to work with you to ensure that your customer journey remains the priority as we move into a new era of customer experience.

3. Actually be agile (not just say they are…)

Everyone is agile these days. Just like everyone is customer-focused and an innovator too (at least if you read their LinkedIn profiles). The reality is that there is a gulf between those who have a truly agile mindset – those who can make decisions at speed, change and adapt processes as situations demand – and those who just like to say they can.

4. Embrace diversity
Diversity comes in many forms – diversity of talent, diversity of thinking, diversity of background. This is about an ability to see value in all forms, to be able to apply different experiences to solve different problems, and most importantly to think differently. Going forward, the customer experience will face some radical challenges, and you need a partner that has the diversity to step outside the box and turn radical challenges into competitive opportunities.

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80% of Americans believe this is what makes a great CX

Competition in the customer experience space just keeps stepping up. There’s a reflexive tendency with some providers to protect their “lowest-cost provider” status. And that will always work - with a certain segment of customers. 

But consider this: 

A recent PwC report states that 73% of all people point to customer experience as an important factor in their purchasing decisions, just behind price and product quality.

We find recognition of this reality from some of the most likely – and less-likely places. In a CNBC interview, Glenn Fogel, CEO, Booking Holdings, asserted: 

“A lot of people [have] built their business by giving away the productin the belief that they're going to bring in a lot of customers, and then at some point they'll turn it around and start charging more and making it profitable.” 

If you’re looking to add and (hopefully, retain) customers, you get how there’s more to winning the war than price. 

This probably comes as no surprise to you, in the era of “customer obsession.” Yet despite the developments in customer technology aimed at improving the customer experience – chatbots, artificial intelligence (AI), etc. – and the different channels we’re communicating with our customers through, PwC research shows the most important factors still come down to making sure we’re delivering on the basics. 

Nearly 80% of American consumers say that speed, convenience, knowledgeable help, and friendly service are the most important elements of a positive customer experience.

Today, we need to be interacting with our customers when and where they need us to – not just how it best suits the business. Failing to do so is risking everything.  

This quote has never been truer: 

“If you make customers unhappy in the physical world, they might each tell six friends. If you make customers unhappy on the Internet, they can each tell 6,000.” – Jeff Bezos. 

Are your current vendors hitting these basic – but fundamental – elements of providing a positive customer experience? 


Five CX takeaways from the luxury brand experience

Why your CX can’t afford to ignore the ‘soft’ skills

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Why your CX can’t afford to ignore the ‘soft’ skills

It’s no secret that digital disruption across all industries is in full swing. 

And yet, regardless of improvements in technology or digitization, customers still want a human customer experience.

Harvard Business Review published an interesting article talking to this exact point around soft skills that are not yet ready to be offloaded to emerging technology.  

Here are three soft skills that HBR advocates won’t be replaced by technology anytime soon – and why they’re so important to your customer experience (CX). 

Emotional competence 

Despite the buzz around bots and self-service channels in travel and hospitality, there’s a real danger of organizations handing over their most valuable relationships to technology that’s not yet ready to handle them. When thinking about the different levels of emotional context, it’s clear technology can’t replace this essential human capability: 

“The most basic level of emotional competence is being able to recognize the emotions at play in the context of analysis and action. The next level is the ability to successfully intervene in an emotionally complex situation, when people are hurt or uncertain. At the highest level, emotional competence involves persuading individuals and groups by evoking emotion.” HBR, 2018. 


Historically, artificial intelligence (AI) has time and time again failed to understand relevant context. What begins merely as a “cute gimmick” - such as advertising delivered via social media - can quickly become a major frustration for customers. The reality is that we’re still miles away from technology providing the same level of contextual understanding that a human can – and travel and hospitality providers need to tread carefully in this area. 


HBR argues that while technology has made waves in education (e.g. online learning), it always has and will for the foreseeable future hinge on the way in which the human uses the technology. At VXI we couldn’t agree more, and we’re of the opinion that we need to be augmenting our agents with technology – not replacing them. That’s why we developed our own Training Simulator™ to empower and develop our agents into the best employees they can be – soft skills included. 

There’s no question that it’s important to weave technology into the fabric of your customer experience, but at the end of the day, it’s always been all about people. 

You need to work with partners who not only understand the value of soft skills – but champions them. Are your current partners up to scratch?

Five CX takeaways from the luxury brand experience

80% of Americans believe this is what makes a great CX

Speak to a CX Expert Today

Contact Jeff