DEEPENING THE BANKING CUSTOMER RELATIONSHIP THROUGH VOICE COMMERCE

2Digital Banking2

Digital assistants are powering always-on ways for banks to engage with customers through contextual - services, positively influencing customer lifetime value.

Digital Banking 3

Digital Banking and

Evolution of Voice Commerce

Conversational Commerce is fast emerging as one of the most important banking

applications using IOT. While previously restricted to chatbots accessed via messaging

expectationsOpen Banking

Hybrid Cloud

Open Unified Digital Banking SolutionsMobile Imaging for Bank Customers

Biometric Mobile Banking Authentication

Open-Source Banking Systems

Advanced Analytics

Wearable Banking Apps

Mobile Imaging for Bank StaffBlockchain/Distributed Ledgers

Digital Personal Financial Advisor Public Cloud for Core Banking

Geolocation Products and ServicesOpen Bank Systems

Digital Payment Advisor Lot for Banking

Business Ecosystem Modeling

Programmable Business Model for Banking

Smart Contracts

Public Cloud Logical Data WarehouseRemote Commerce Emulation Payment Systems In-Branch and ATM VideoCloud-Driven Business and IT Services

Social Messaging App Wallet

Tablet Apps Digital Wallets

BIAN StandardsIntelligent Bank Operations

Private Cloud Computing Mobile-Originated Proximity Payment Systems

Near -Real-Time Low-Value Payment Systems

Mobile-Originated P2P Payment Solutions (for Mature Payment Markets)

Smartphone Banking

Mobile Wireless Payment Sysems (for Nonmature Payment Markets)

Innovation Trigger

Peak of Inflated

Expectations

Trough ofDisillusionment

Slope of EnlightenmentPlateau of

Productivity

Plateau will be reached in:

Time

Digital Wallet Consumer Hub

Less than 2 years 2 to 5 Years 5 to 10 Years

More than 10 years

Obsolete before plateau

The Internet of Things (IoT) is steadily becoming embedded in all our lives. Individuals,

businesses and financial institutions are all users of this new technology and are looking

for ways to exploit it. The technology is still at a nascent stage of development (View Gartner

Banking Hype Cycle) below but has the potential to enable banks function as the alter

ego of their customers, maximize financial well-being and seamlessly meet banking

and payment needs.

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Source: Gartner's Banking Hype cycle, from Hype Cycle for Open Banking, 2018

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Gartner predicts that by 2020, 30 per cent of web browsing sessions will be done 2without a screen.

Voice-enabled assistants are the newest ‘must-have’ technology among banking consumers,

with Google, Amazon, Apple, and other giants rolling out Artificial Intelligence-infused

gears, functioning primarily through conversational voice interfaces. Globally, the number

of customers using voice-assistants is increasing with a compounded annual growth 1

rate of 29.4 per cent and is estimated to reach 1.83 Billion by 2021. Alexa, Siri, and

Google Assistant have all become an integral part of a millennial’s day. From setting

up reminders, checking the weather, to shopping – these voice-enabled digital

assistants have covered most of the bases of everyday life, heavily influencing the

mobile-tech experience customer's connected.

apps for shopping, the definition of Conversational Commerce has significantly expanded

with the arrival of voice-based personal assistants.

Increasingly, banks are interacting with customers through “full-service automated voice

assistants” (chatbots) Capital One has been a pioneer in adopting voice in the financial

services sector. It has launched an Amazon Alexa Skill to allow consumers to access

their account information and even pay their credit card bill simple by using voice

commands. A large insurance provider in Europe has also implemented a voice assistant

to help its customers 24/7 on all its channels (telephone, apps, chat among others). The

voice assistant uses colloquial language to converse with users and provides them with

fast, accurate and personalized answers in addition to anticipating their needs. This not

only enhances customer experience but also improves operational efficiency for the customer

service representatives by allowing them to focus on more value-added requests and

pre-qualify some of their customers’ demands through an exchange already made in

advance by the voice assistant.

Mastercard research has found that 87 per cent of US consumers are aware of voice and

text agents and 66 per cent have used them in the past, while in the EU, the figures

indicate one in five consumers active in this area (21 per cent shop, 16 per cent make

payments and 7 per cent have banked). Similarly research from Capgemini has found there

is significant interest in using voice assistance for purchases across most product and

services categories with interest levels high for ordering meals (56 per cent); electronics

(52 per cent); groceries or personal care items (45 per cent each) and banking 4(44 per cent).

Although voice commerce is still a nascent opportunity, it already has a powerful

influence on consumer behaviour. Eighty-five per cent of Amazon customers select the

recommended Amazon product when voice shopping – especially in popular categories 3

such as electronics, groceries and home goods. Since Amazon is already a reliable source

for reviews and suggested product information, consumers are more likely to trust these

"recommended" products as a good fit for them.

A Sound Influence on

Customer Engagement

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Strengthened user engagement implies more loyal customers, which ultimately translates

into an improvement in the topline. Per se, launching a new channel does not imply a

stronger bond with the customer. The ability to deliver excellent and customer-centric

services where and when they want is the first logical step in customer engagement. Voice

Commerce deploys cognitive capabilities, speech analytics and Big Data to build interactive,

intelligent rewarding and trusted interactions with customers.

Principles of Engagement

Conversational Commerce is about enabling a more natural conversation between the

bank and its customers. Even though customers know it’s a bot, the conversation replicates

the natural flow, cadence, inflection and the timing of human interactions, so customers

feel comfortable exchanging information with the bot. A persistent flow of information

coupled with the voice bot’s built-in cognitive capabilities, helps banks ascertain customer

transaction patterns and deliver services tailored to user needs and preferences.

Voice Commerce Engagement Features

INTELLIGENT

TRUSTWORTHYCONVENIENT

INTERACTIVE

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The dynamics of a good customer engagement also has a basis on how well the banks

know their customers and the ability to earn customer trust. The conversations between the

customer and the chatbot builds a unique transactional imprint of the user that is not easily

replicated by competition. Every time the user issues a voice command, the system records

impressions of the customer’s, sentiment, intent and transactional imprint, which coupled

with account information can be used to forge deeper relationships with customers. Over

time customers can model service demand patterns to anticipate customer intent in

order to make recommendations and properly complete tasks.

Further, banks not only need to know the customer but also recognize the customer across

channels. Voice Commerce services need to be integrated with other banking services to

offer a uniform and consistent service experience. Customers could start with a voice assistant,

pick up where they left off on their mobile or finish the process by calling the contact

centre— with all their progress and information seamlessly transferred along the way.

Rewarding customers for their potential business has a positive influence on the customer

adoption and use of voice commerce. The offers could include waived fees for a certain

number of transactions or an optimally enhanced level of rewards for a specific action for

a limited duration. When banks are perceived as more relevant, it builds consumer trust.

Voice Commerce has the potential to build a diversity of relationships beyond transactional

banking. A secure and trusted flow of customer interactions will help drive usage. Customers

are likely to use Voice Commerce if their personally identifiable information are in good hands.

Access to banking service and full-time service engagement over Voice Commerce

requires banks to ensure adequate security and transparency regarding the collection

and utilization of customer data. A multi-layered approach to security including

voice-based Biometrics, data encryption and multi-factor authentication will be key to

winning customers.

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Voice Commerce has the potential to build a diversity of relationships beyond transactional banking. A secure and trusted flow of customer interactions will help drive usage. Customers are likely to use Voice Commerce if their money and personally identifiable information are in good hands.

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Enhanced Customer

Engagement

A financial services digital companion to a customer acts as an extended presence of

the bank, providing customers with access to banking and payment services. Banks would

adopt a calibrated approach to services rollout – beginning from basic transactions to

engage customers via a new channel to more complex interactions that anticipate and

predict customer behaviour.

Human in the Loop - A Near-Term Use Case

But through the use of technology, fintech businesses and banks can move to a world

where such issues are a thing of the past. Artificial Intelligence and Natural Language

These frustrations could also lead to issues being magnified more than needed. For

example, a bank was in the headlines last summer for hold times of several hours for

its customers querying delays to their credit card statements. This led to consumers

venting their anger on social media and those publications covering the story. If these

phone calls were dealt with swiftly and effectively, the bank would have been able to

reassure their customers in a timely manner, and the problem would not have been

unnecessarily amplified.

When consumers contact their service provider or retailer it is often because they have

an urgent matter to resolve, particularly when they call their bank. However, people are

often faced with lengthy hold times, and a frustrating series of questions before they are

even able to speak to an agent. This only increases the customer's sense of frustration.

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Machine Learning (ML) can transform the fabric of voice-driven customer experience

through speech recognition technology. Voice-driven customer service can complement

staff and improve customer satisfaction. We're now at a stage where the technology

can understand speaking habits, conversational linguistics, dialects, idiosyncrasies, slang,

foreign nationals' accents, intonation, emphasis, intention and enunciation. It can even

understand sentiment and recognizes intent.This means that the technology can be

deployed in several ways to ensure that customer issues are dealt with quickly and effectively.

From Assistants to Advisors

Voice Commerce will transform from playing an assistive role to playing an advisory role.

On smartphones as well as in homes and cars, general purpose chatbots will increasingly

have the ability to understand an individual's situation in order to make recommendations

and properly complete tasks. That means they will gain expertise and deep domain

knowledge in specific fields, like finance and planning, health and wellness, travel and

hospitality, shopping and entertainment.

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Bank of America, an American multinational investment bank and financial

services company based in Charlotte has developed their voice bot called Erica.

Erica drills deep into customer data to pre-empt their needs and suggest

solutions. It's voice and chat driven to manage the customers' money. Built by a

team of 100 people, Erica is unlike other chatbots that answer simple questions.

It pre-empts a customer's needs to offer relevant advice. For instance, it analyses

customers' withdrawal history to gauge their spending patterns and inform them

if they're running on low balance. It even suggests solutions like transferring 5

funds or sends notifications about where they can save money.

TD Bank is a U.S. national bank and subsidiary of the Canadian multinational

Toronto-Dominion Bank, TD Bank's online brokerage arm, TD Ameritrade, offers

an Alexa skill which provides quotes for all U.S.-traded stocks, ETFs, mutual funds,

and major U.S. indices–75,000 securities. The skill is open to everyone. “Just ask

for a quote by security name or symbol or ask for a market update. And, stay

tuned—we'll let you know as we add support for more requests about the market 6and your account,” the skill description reads.

Liberty Mutual Group, is an American diversified global insurer, and the fourth-

largest property and casualty insurer in the United States, Liberty Mutual's Alexa

skill allows you to obtain an auto insurance estimate by interacting with the Liberty

Mutual Guestimator tool, as well as to receive advice on common seasonal home 7and auto worries with access to Liberty Mutual's online resource.

Field Proven Use Cases

Voice Commerce will transform from playing an assistive role to playing an advisory role. On smartphones as well as in homes and cars, general purpose chatbots will increasingly add the ability to understand an individual's situation in order to make recommendations and properly complete tasks. That means they will gain expertise and deep domain knowledge in specific fields, like finance and planning, health and wellness, travel and hospitality, shopping and entertainment.

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Banks need to enable customer’s natural migration towards digital transactions. They

also need to create opportunities through sales and customer service touch points to

route customers back into a conversation with a staff member whenever they need

and want it. Staff members must be fully empowered by technology and data to offer

the best advice at the right time. For employees, banks need to use technology to empower

them to do what people do best: be empathetic, solve problems and provide the human

interaction that the majority of customers still want from their bank. In this model, banks

remove the tedious and administrative tasks from employees by using technology to

amplify what is truly differentiating about personal interactions and, in the process,

make their jobs more productive and more meaningful.

Opti-channel experience is optimizing the channel of communication to fit the context

of the interaction and ensuring a smooth handover. Without the capability to offer Opti-

Channel interaction, the real opportunity of Conversational Commerce cannot be realized.

It can be as simple as an AI-powered chatbot automatically connecting a consumer to a

human representative for final confirmation of the purchase of a big-ticket item. It can also be

complex, like when starting a shopping query on a voice assistant, browsing options on

a screen, engaging with a chatbot for more details, and finishing off with an email to

confirm payment.

A smooth handover between channels of communication, an “opti-channel” experience, is

vital. Today’s Voice Commerce revolves around the emerging use of chatbots and voice

assistants, which combined with other technologies, does offer that experience.

Voice Commerce and

Opti-channel Experiences

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Voice Commerce in Banking -

The Opportunity

Enable Convenient Banking Services

Leverage Customer Insights

Boost Loyalty Through Digital Channels

With the help of voice technology, consumers can easily ask for account balances,

request an analysis of their financial health, and inquire about their investment portfolio.

With the fintech industry leveraging Artificial Intelligence, machine learning and natural

language processing, voice applications can gather key customer insights to personalize

and improve offerings.

Financial service providers can increase customer loyalty through voice applications

that help to improve customer short-term and long-term financial wellness.

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Use of AI and the enrichment of the data bank will enhance the conversations further,

where Voice Commerce can predict and advice the customers extensively.

Existing Use Cases

Retail Banking Use Cases

Wealth Management Use Cases

Banks and financial institutions can use voice technology to provide individuals with

customized, personalized banking experiences to improve their financial health

and better manage their personal finances.

Empower consumers with easily accessible insights into their investments

with data-driven personalization.

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Ask for bank account balances, pending payments, Merchant

Payments, Bill Payments or deposits

Request analysis of current financial health and leverage

transaction data for predictive insights to increase savings

Ask about transaction history and how to reallocate extra budget

Obtain information on category-focused spending and expenses

Make donations and transfer funds

Schedule payments and automate Payments

Recharge wallets and make credit card payments

Customers can set limits on their credit card or debit card accounts

Enquire about their investment portfolio and how to optimize

returns

Ask for stock updates and receive email or text alerts when a

stock reaches a certain price

In the USA, consumers can receive updates on their 401(k) and

find out how to rollover assets

Obtain market and stock performance data

Users can:

Users can:

Payments Use Cases

Lending Use Cases

Voice applications for payments offer an opportunity for financial service providers to

differentiate and deliver personalized banking services.

Offering services through Alexa Skills or Google Assistant Actions can open new

doors for lenders and help to streamline the process.

Ask about the latest interest rates on mortgage loans and

explore refinancing options

Obtain information on small business loans and how to get

access to working capital

Ask about personal loans for major expenses or debt consolidation

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Schedule and make payments to providers and credit cards

Transfer money between accounts or deposit money

Send money to friends or family using payment applications

like FSS mPay or any other banks application or a third-party

integrator like Zelle

Ask about transaction history dashboard with information on

future or outstanding bills

$

$

$ $

$

$

Users can:

Users can:

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Banks and financial institutions can use voice technology to build an ongoing dialogue

with customers as unique individuals, deliver personalized payments as well as banking

products to improve their financial health and better manage their personal finances.

Most bots today, however, have limited capabilities and there is no instant cookie-cutter

model to a successful Voice Commerce deployment. The successful adoption of Voice

Commerce would depend upon:

Strategies for Driving Voice

Commerce Success

Factoring gestation period for training the bot

The promise of ultimate convenience from voice bots depends on an understanding

a consumer’s intent. As usage of Artificial Intelligence based advisors for commerce

(and more) increases, the data pool and contextual capability is also enriched. Time

however needs to be taken in building the voice-banking function, considering both

how consumers would request a particular action, and the appropriate responses by

the Voice Commerce system.

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Embracing Voice Commerce + Digital Banking strategy

With the advance of new devices and intelligent end points, a bank and brand’s

connection with consumers becomes much more varied and complicated. Rather

than deploy Voice Commerce as a standalone channel, it needs to be integral to the

bank’s overall digital strategy. They’ll also need to integrate with existent digital

banking platforms, CRMs, and contact centres for orchestration of consistent and

seamless cross-channel services experiences, without customers having to repeat

information, as the backend system maintains a record of the interaction history.

Assuring security of transactions

Banks need to operate within rules that can help them maintain customer trust and

data security. As payment and banking transactions move to the voice channel and as

With new technology like voice banking, it's easy to overlook the work required by

consumers particularly at the outset, when they are easily distracted by the novelty of

the channel. Banks need to adopt a calibrated approach to services adoption. Start simple,

with a narrow set of services, expand from there, and be ready to learn. The initial focus

could be on introducing primary and easier functions (like balance enquiry). As customers

become more familiar with voice as a commerce channel, new services can be layered,

and the transactional portfolio can evolve to offer a range of products and services.

Adopting a listen and learn approach to technology

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Embracing design thinking

Reducing human intervention to critical moments and drawing on artificial intelligence

for the bulk of interactions is crucial to success. An understanding of customer journeys,

recognizing the customer intent and identifying the transactions that can be automated

and which inquiries to hand over to human support staff at the right time will be a crucial

success determinant.

Customizing digital assistant personality

Customers are excited to interact with a digital assistant that has a real-human personality

and can understand customer sentiments and respond appropriately. Banks need to

design the digital assistant in a way it can answer customers empathetically, with a

voice consistent with its overall brand values

Defining business objectives clearly

Basis business objectives - building brand differentiation, improving resolution time,

successful automation or CSAT, it’s necessary to establish related metrics that are

important and monitor them regularly.

banks provide access to third-party services over the voice channel, banks need to

ensure security measures are current, aligned and robust enough to safeguard against

fraud and other risks. Behavioural biometrics, multi-factor authentication, tokenization

of sensitive personal credentials would be critical for user authentication.

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There is an obvious competitive advantage that banks derive for enhancing their customer

experience Banks and financial institutions can use voice technology to improve revenues

per customer, lower costs and optimise engagement.

Benefits of Voice Commerce

COST

REDUCTION

Reduce costs for

customer support

and research /

surveys

CUSTOMER

SATISFACTION

Improve the overall

customer experience

by providing easily

accessible and " real-

time" information to

personalise services

DRIVE

INCREMENTAL

SPEND

Capturing

"spontaneous" or

"distressed " purchases

or providing inspiration

e.g., providing cashbacks to

encourage additional spend

CUSTOMER

LOCK-IN

Through improving

customer experience

and collecting customer

data to enrich CRM

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For banks, the best voice commerce functionality includes:

Multi-pronged NLP Engine: Enables natural language processing and precise

intent identification for multi-level dialogue with consumers

Speed to Market: A bot builder framework enables the bank to extend and

customize bots and build new bots to meet their conversational banking objectives

Bot Builder Framework: Enables the bank to extend and customize bots and

build new bots to meet their tactical and strategic Conversational Banking objectives.

Open and Extensible: API Layer for integration with bank internal as well as third

party systems to construct truly differentiated user experiences and offerings

Dashboard and Analytics: Leverage structured and unstructured data and get

insights to drive deeper engagement, conversion, and share of wallet. The goal

of these processes is to refine bot performance and continually learning about

customer preferences

Support for Human Native Interfaces: Deploy AI agents that power voice,

conversational experiences in addition to traditional web and mobile applications.

Built for Banking: Enterprise-grade and purpose-built for banking

Security: Comprehensive security framework to protect data an rest and in transit

and win customer trust

Flexible Deployment Options: On premise, private cloud, public cloud, or a

hybrid.AI and ML

As banks start to build and integrate these solutions, it is key that they start small

and take an iterative, test and learn approach to implement a successful voice

commerce strategy. FSS can help banks roll out Voice Commerce strategies and

integrate them with existent bank channels

FSS can help banks roll out Voice Commerce strategies and integrate them with

existent bank channels

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We are a social species and the spoken word is the most natural and basic way we

interact with each other. It's the clear evolutionary next step for Conversational

Commerce, but it's a step that's proving slow and difficult to take. Artificial Intelligence

and Natural Language Processing are making our tools more powerful, but it is the

implementation that will make or break voice as a channel. Voice holds a great deal

of potential if we can bring consumers on the journey. The technology is here and the

payments networks that enable it are already in place.

Rather than replacing sales channels, voice commerce can be integrated into online

retail, apps, and other services. Smaller retailers should pay close attention to voice

commerce and the significant resources invested by some of the world's major retailers,

threatening those retailers who fail to adapt.

While it may be a few years before voice activated assistants can talk to us like real

humans, there is valuable groundwork to lay today to ensure adoption doesn't stagnate

and that consumers are encouraged to adopt voice services. Only by establishing trust

today can we unlock the future promise of voice driven Conversational Commerce

and create better conversations between brands and their customers.

We also need to work on defining the playing field for our partner ecosystems and

establishing the rules of engagement and regulations that support our services. These are

big conversations, and no one has all the answers today. It's about asking the difficult

questions, experimenting and seeking answers from outside your own organization.

Outlook for Voice Commerce

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1. The digital assistants of

tomorrow- Juniper Research

2. Conversational Commerce:

Why Consumers Are Embracing

Voice Assistants in Their Lives-

Capgeminihttps://gomedici.co

m/rise-of-voice-payments-

ecosystem/

3. https://thenextscoop.com/c

ustomer-engagement/

4. Conversational Commerce:

Why Consumers Are

Embracing Voice Assistants

in Their Lives-Capgemini.

5. https://bankinnovation.net/2

017/03/7-financial-services-

skills-alexa-has-that-you-didnt-

know-about/

6. https://bankinnovation.net/2

017/03/7-financial-services-

skills-alexa-has-that-you-didnt-

know-about/

References

Digital Banking 25

7. https://bankinnovation.net/2

017/03/7-financial-services-

skills-alexa-has-that-you-didnt-

know-about/

8. https://fitsmallbusiness.c

om/customer-engagement-

strategies-and-tips/

9. https://fitsmallbusiness.co

m/customer-engagement-

strategies-and-tips/

10. Gartner Banking Hype Cycle

11. Accenture-Research-Conver

sational-AI-Platforms https://bank

innovation.net/2017/03/7-financial-

services-skills-alexa-has-that-you-

didnt-know-about/

13. Accenture-Voice-Assistant-Infographic

14. dti-conversational-commerce

15. https://www.iflexion.com/blo

g/voice-commerce.

16. https://friendlydata.io/blog/

nlp-in-finance

17. Voice Search Will

Eventually Revolutionize

Search Marketing, Sept. 2017

12. https://bankinnovation.net/

2017/03/7-finanacial-serv

About FSS

Contributors: Ruchika Mathur, Asst. Marketing ManagerReviewers: Shikha Bhatia, Marketer Software Products, Benedict Xavier Head, Digital Banking Business