The global market for banking CRM software generated $9.5 billion in sales in 2021 and is expected to grow at a compound annual rate of 15.7 percent through 2031, reaching $39.2 billion, according to Allied Market Research. This market expansion underscores rising demand for CRM financial advisors rely on, particularly in financial planning and relationship management activities that leverage data-driven insights.
Drivers for growth include the need to improve customer service for an increasingly digital business, according to the analyst firm. In today’s customer-centric environment, implementing a user-friendly interface within a CRM solution can enhance lead management and pipeline management, enabling effective sales marketing and a more streamlined sales pipeline.
Financial services companies began their digital transformations before the COVID-19 pandemic, which accelerated the process once customers were locked out of in-person service. Though branches have reopened, customers who went digital have not returned to branches at previous levels, so digital customer service remains a primary concern for financial institutions. Services CRM platforms allow teams to provide real-time support and track every customer relationship with precision, ultimately improving customer experience across multiple channels.
The digital transformation is far from complete, says Sam Kilmer, managing director of Cornerstone Advisors, a banking consulting firm. “They’re still making a lot of changes. Only one in four will tell you that they are even half done. It’s still very much a work in progress.” In many cases, financial advisors and other professionals in the financial services industry continue to adopt solutions such as Zoho CRM and Salesforce financial services cloud options to refine client interactions and integrate these systems with their broader financial CRM infrastructure.
Industry experts agree it is a worthwhile endeavor.
By digitizing their book of business with modern CRM technology and marketing automation software, financial advisers can organize client data and use historical interactions and automated communications to advance business relationships, says Steve Oriola, president and CEO of Act!, a CRM and marketing automation systems provider. “Data from Forrester reveals that 77 percent of customers are willing to stay longer with a financial institution if they feel valued. The key to retention—making every client feel like your only client—is personalized communications. CRM software enables financial services firms to more effectively communicate, exceed expectations and delight clients by leveraging their data.” This type of workflow automation empowers financial advisors and helps them track financial goals, client relationships and other critical data points that strengthen their overall management CRM strategies.
This was a lesson learned by the Sherman Sheet, a financial services company that struggled to maintain a high level of personalized communications while managing numerous client campaigns. “With Act!, they are able to create, manage and deploy highly targeted customized campaigns, running up to 12 campaigns simultaneously with a modicum of effort. Optimizing client-facing resources is the key to pleasing more clients, more often,” Oriola says. This approach to client data shows how CRM financial solutions can increase efficiency while retaining a user-friendly approach.
However, this is not the biggest challenge facing financial services companies today. “Every business faces challenges from inflation, economic instability and the prospect of recession. Financial services firms face the dual threat of the inevitable impact of uncertainty on their own business, while advising clients as they seek to navigate these waters for themselves,” Oriola says. In these times, a dependable finance CRM equipped with contact management capabilities, real-time reporting and pipeline management can be a pivotal asset for adapting swiftly.
On top of this, the standard for exceptional customer service in financial services is rising.
CRM systems play a key role in streamlining how financial services firms share insights about customers and take action to deliver great experiences at scale, says Daniel Brousseau, head of financial institutions strategy at Medallia. By deploying CRM finance solutions that track client interactions across multiple platforms, including mobile and online portals, banks and other financial institutions can strengthen their customer relationship strategies.
“Many CRM systems at financial institutions are directly integrated with enterprise experience management platforms that capture, analyze and orchestrate action on structured customer feedback (surveys) and unstructured data signals, such as natural language understanding (NLU) and digital behavior analytics,” Brousseau says. This data-driven approach fosters deeper relationship management, enabling financial services firms to offer more effective customer support and build stronger, more profitable client relationships.
Modern financial services solutions have prebuilt integrations with CRM systems, as well as real-time bidirectional data exchange between systems as standard features, Brousseau adds. “Through these integrations, financial services firms can operationalize how they drive more customer-centric action and increase loyalty and retention while providing a lower cost to serve.” In doing so, an organization can unify its financial services cloud strategy with powerful CRM financial advisors rely on for day-to-day operations.
CRM systems can also increase sales while deepening customer relationships, Brousseau says. “For example, financial services teams can pursue new upsell opportunities based on insights from customer feedback, identify and manage at-risk accounts and personalize interactions with their clients. They can also leverage feedback to create more personalized campaigns, promotions and other materials to build upon existing customer relationships and even acquire new customers.” This level of customer relationship management supports improved sales marketing while also enhancing the sales pipeline.
Feedback from customers can also reveal valuable insights about how customers perceive their experiences with the firm, enabling them to identify ways to improve how they resolve customer issues and refine enhancements to products or services to foster a customer-centric business, Brousseau adds. “Firms can centralize and automate how insights are captured and analyzed through systems that leverage advanced AI-enabled natural language understanding.” This aligns with management CRM platforms in financial services, especially when companies analyze large volumes of customer data to achieve better retention and new opportunities.
Like other industries, financial services relies on CRM systems for a 360-degree view of the customer. This view has become increasingly important for traditional financial services providers as more of their industry-specific technologies adapt to capture new avenues of growth, such as PayPal for payments, Hometap for home equity financing and SoFi for banking, investments and loans. With the right financial CRM software, providers can integrate seamlessly with these emerging platforms, enhancing customer relationship management and overall satisfaction.
To gain a more complete view of their financial relationships with customers and portions of customers’ financial business going to emerging platforms and traditional competitors, banks have implemented technologies such as Adobe, Salesforce and Pega, says Frank Sanni, chief strategy officer of Harte Hanks, a marketing services provider. These solutions often incorporate workflow automation and a user-friendly interface—qualities that drive successful CRM financial services.
Sanni pointed to some notable improvements banks have achieved with CRM and related systems:
U.S. Bank experienced a 2.35 times lift in lead conversion by implementing a single, unified database of client information, enabling a better customer experience as well as more strategic marketing execution.
Wells Fargo implemented a real-time modeling and adaptive machine learning solution to drive greater personalization, resulting in increased conversion rates across channels and significant increases in customer engagement rates.
While traditional CRM providers are capturing much of the financial services market, newer entrants are emerging as well.
Two such solutions were unveiled in March. FYG Planners launched WealthEye CRM, an application to help financial advisers better manage client relationships. WealthEye CRM, built on Microsoft’s Dynamics 365 platform, helps financial advisers streamline advice, marketing and client service functions. WealthEye CRM also provides analytics and reporting. Its key features can be viewed as part of a broader finance CRM strategy that helps unify customer support, pipeline management and long-term relationship management.
“We know technology is the way forward for advice because it automates and takes the focus off tasks that have been overwhelming advice businesses in recent years. We really wanted to build our advisers a CRM that helps them succeed,” FYG general manager Andrew Wootton said in a statement. “Financial advice is always going to be about relationships, so WealthEye helps advisers turn their focus more toward building those long-lasting relationships with clients.”
Qualtrics launched its Retail Banking Accelerator to help financial services organizations adopt the Qualtrics Foundational Customer Experience solution. The new solution enables retail banks and credit unions to set up CX improvement projects by leveraging deep insights combined with automated workflows. Continually updated benchmarks will allow financial institutions to compare themselves to peers and measure their success on customer satisfaction, trust and other factors that drive customer experience.
QUALITY DATA ESSENTIAL
Regardless of which CRM solution they employ, financial services firms cannot realize the full benefits of CRM solutions without good, clean data. This is particularly true in the realm of CRM financial advisors use for contact management or wealth management initiatives, where accurate, centralized client data is vital for success.
“The financial industry in recent years has increasingly started depending on data and information for operational decisions and to help optimize processes and grow the bottom line,” says Mayukha Perera, assistant director of CRM data solutions and investment research at Acuity Knowledge Partners. “Most of the business intelligence of the industry is derived out of CRM data. This data is primarily comprised of in-depth data on clients, analysts they liaise with, client interactions such as meeting notes, road show and conference details, etc.” In other words, trustworthy data is crucial to keep the sales pipeline fruitful and client relationships strong.
The financial services industry faces a growing number of data security and consumer privacy standards and government regulations, which makes the need to maintain qualitative CRM data even more critical, according to Perera. “Prior to industry growth and regulations, companies opted to maintain this data in a non-structured manner, and at times even in the form of Excel spreadsheets. However, with growth resulting in increased client interactions by finance analysts, the collation of this data at a firm level in a structured manner can be streamlined with a comprehensive CRM platform. Technology vendors have come forward and introduced CRM platforms that finance firms can procure to capture data.” Ensuring that data is easily accessible in real time also helps institutions meet financial goals while maintaining compliance.
Though most financial services firms have adapted to changes and have procured CRM platforms to capture data stored and managed by various stakeholders, ensuring the integrity and credibility of this data has remained a challenge, Perera points out. The biggest challenges are data duplication and gaps in structured and unstructured data. Overcoming these hurdles is crucial in fully leveraging the capabilities of management CRM solutions that incorporate workflow automation.
This has become even more challenging as financial firms often lack the bandwidth, personnel and infrastructure to ensure CRM data quality. Financial services companies are increasingly offloading their data and knowledge management, CRM implementation and integration, data cleansing and monitoring services to outsourcers, Perera says. These firms take complete ownership of data quality.
Acuity recently partnered with a U.K. investment bank to migrate 1 million CRM data points from spreadsheets to Salesforce. The team gathered data and collated it onto a master database, which was cleansed, de-duplicated and updated prior to migration.
“The team currently works with the bank in continuing to maintain their CRM database on Salesforce, from day-to-day maintenance and regular cleansing to ensure data quality and collation and visualization of business intelligence through [Microsoft] Power BI,” Perera says. By upholding these standards and ensuring continuous improvements in data integrity, firms maximize the benefits of financial services CRM implementations.
With 2023 continuing to be a challenging year for all industries globally, financial services firms will need business intelligence and information to stay ahead of competitors, Perera states. “This in turn would increase the demand for CRM platforms to assist financial firms with their customer data management.” In such a competitive environment, solutions like TimeLinx Software can help streamline project and field service management while integrating seamlessly with Sage CRM and accounting solutions, further reinforcing a data-driven approach to meeting financial goals.
