Reinventing the mortgage customer experience: now more than ever, mortgage lenders need to focus on delivering a first-rate online customer experience.

Author:Tompkins, Paula
Position:TECHNOLOGY

Acelerating the digital transformation of the customer experience is now one of mortgage industry executives' top-five imperatives. Industry experts say lenders have just two years to reinvent their origination and service delivery. [paragraph] Deloitte's Silicon Valley, California-based Center for the Edge shares in The Burdens of the Past (its Report 4 of the 2013 Shift Index series) that the "topple rate" at which companies lose their leadership positions has increased. The average life expectancy of Fortune 500 companies (or any company) is rapidly declining. Digital disruption is their demise. The clock is ticking. [paragraph] The good news is the mortgage industry is finally prepared to move beyond the compliance nightmare. Lenders are making baby steps to improve digital connectivity with customers and sales channels. [paragraph] Westlake Village, California-based J.D. Power's 2015 U.S. Primary Mortgage Origination Satisfaction Study[sm] reports higher satisfaction among customers who use digital channels for mortgage application-related activities, such as completing an application and submitting documents. The satisfaction drivers are transparency and communication.

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Despite efforts to improve the digital customer experience, bankers received alarming news in the World Retail Banking Report 2015, published by Paris-based companies Capgemini and Efma: The Customer Experience Index (CEI), a metric tracked annually by Capgemini and Efma for traditional bankers, is stagnating. This data is supported by the Consumer Financial Protection Bureau's (CFPB's) consumer complaint data.

While all ages voiced fewer positive banking experiences in the study, there was a sharper decline in satisfaction when it came to servicing Generation Y (those currently 16 to 36 years old, according to the Capgemini/Efma study). Their dissatisfaction runs deeper because great digital experiences are the price of entry when it comes to a purchase and building a lasting customer relationship. From Gen Y's perspective, the banking industry is a lagging sector.

In Accenture's Banking Customer 2020 report, consumers reiterate they want to communicate electronically. They view the online customer experience as the single most important area that banks need to improve.

The demand for transparency and self-service, plus the need for compliance management, means lenders must reinvent the customer experience. In my view, customer relationship management (CRM) systems have largely failed, especially in the mortgage sector.

In my company's 30-plus years of digital marketing, we have learned there are three core steps to reinventing the customer experience:

* Management must start with a strategy and plan that includes a good understanding of the customers' entire journey, even though it crosses departmental silos.

* Develop the capability to provide a truly unique and personal experience versus inserting a name in a mass email.

* Select the right information technology (IT) partner; internal resources have not been successful. Management needs an IT resource that provides strategy, usability, creative and technology capabilities.

You need a strategy and a plan: Walk the distance in your customer's shoes

At one time, a consumer's relationship with a financial institution was akin to marriage--together "until death do us part." Accenture's 2015 report, Banking Shaped by the Customer, reveals that today 79 percent of U.S. consumers categorize their banking relationship as merely transactional. This change of attitude has negative consequences for customer retention, cross-selling or up-selling.

If you start with the essential customer needs...

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