Recommender Systems at Touchpoints

Discussion

all sub-phases. Similar to ‘delivery’, implementing a recommender system in this phase has no effect on customer experience in banking.

On the other hand, the implementation of a recommender system in the post-purchase stages

‘supplement’ and ‘disposal’ has a statistically significant positive effect on customer experience in banking. This fact is supported by Voorhees et al. (2018) stating that recommendations are a key service encounter in the post-purchase phase. As defined by Dhebar (2013), after-sales services are an important component of the supplement phase.

Due to a moderately high mean in this phase, the findings indicate that customers would appreciate recommendations at this point to – for instance – enable better performance of their financial products and services. In sum, in line with Maechler et al. (2018) and Chen et al. (2013), with the vast amount of options, a recommender system can potentially support decision-making at these two points and thereby enhance customer experience.

Non-Significant Positive Effect on Net Promoter Score for Customer Decision Journey Although the change in the NPS from before and after the potential implementation of a recommender system is not statistically significant, the findings imply that the NPS would increase from +5.5 to +15.7. This change is explained by the increasing number of

‘promoters’ and the decreasing number of ‘detractors’ from time 1 to time 2. Therefore, – with caution – it can be concluded that with a recommender system in place at all customer journey phases except for delivery and use, customers are more likely to recommend their bank to their social environment.

Discussion

recommender system implementation. Due to the fact that it is vital for companies to understand, manage, and design every point of interaction between a customer and the brand (Edelman, 2010), the following individually discusses the effects of all touchpoints.

Positive Effect of Mobile App, Online Banking, and Bank Advisor

The touchpoint ‘mobile app’ has the highest mean, which indicates that providing customers with recommendations through a mobile app has the most positive mean. This positive effect on customer experience is supported by the gathered data on both sample demographics and general banking questions: as such, it can be explained by the rather young sample and by the fact that the mobile banking app is the second most frequently used touchpoint by the participants. The finding is in line with Ieva and Ziliani (2017), who found that mobile banking apps have a positive effect on customer loyalty in retail banking. Furthermore, Srinivas et al. (2018) state that banks are increasingly adapting their customer experiences in a mobile-centric manner.

In addition, the results of the study at hand indicate that customers would appreciate their banks to support them with relevant and personalised recommendations through the touchpoint ‘online banking’. This finding is supported by the fact that participants most frequently interact with their bank through the bank’s website and online banking, which can be stressed by the fact that online banking has a positive effect on customer loyalty (Ieva &

Ziliani, 2017).

Moreover, the findings imply that providing customers with relevant and personalised recommendations through the touchpoint ‘bank advisor’ has a significant positive effect on customer experience. However, this effect is not in line with Ieva and Ziliani (2017) stating that there is a negative relationship between bank advisor and customer loyalty in retail banking. Furthermore, the personal bank advisor is not a touchpoint with which the study’s participants frequently interact. Nevertheless, the positive effect can be explained by Zibriczky (2016) stating that due to the long-term commitment of financial products, oftentimes, expert knowledge is necessary in order to make a good purchase decision. This fact can be related to Gorgoglione and Panniello (2011) who state that banks are today highly dependent on the capabilities and competencies of their front office personnel to provide a

Discussion

coherent service. Thus, if the bank’s goal is to provide personalised recommendations, increasing the efficiency and effectiveness of bank advisors by implementing recommender systems has the potential to significantly improve customer experience in banking.

In sum, the touchpoints that have a positive impact on customer experience are both physical and digital which is in line with Ieva and Ziliani (2017). This provides evidence for banks that in order to manage customer experience in a compelling way, they should embrace an omni-channel perspective across these touchpoints (Ieva & Ziliani, 2017).

Negative Effect of E-Mail, Customer Service, Postal Mail, and Mobile Messaging

In contrast to the previously discussed touchpoints, the findings indicate that providing customers with recommendations through the touchpoint ‘e-mail’ has a negative effect on customer experience. This finding is not in line with Ieva and Ziliani (2017), who find that the touchpoint e-mail generally has a positive effect on customer loyalty in retail banking.

Nevertheless, the negative effect can be related to the general assumption that customers are assumed to perceive newsletters via e-mail negatively and often consider these rather as spam messages. In particular, this is assumed to be true for retail banking and might be different for other industries.

Similarly, the fact that recommendations provided by ‘customer service’ agents have a negative effect on customer experience is not in line with research by Ieva and Ziliani (2017).

However, it can be explained by the general assumption that customer service is something anonymous, where personalised recommendations based on personal data might not seem appropriate to customers.

Moreover, the finding implying that recommendations via ‘postal mail’ also have a negative effect can be drawn back to the relatively young sample. As such, it is reasonable to assume that particularly young bank customers do not appreciate recommendations provided by post.

Ieva and Ziliani (2017) find that postal mail has no effect on customer loyalty.

Finally, Ieva and Ziliani (2017) also show that there is no effect of the touchpoint ‘mobile messaging (SMS)’ on customer loyalty in retail banking. In contrast, the study at hand

Discussion

suggests that providing recommendations via SMS has the most negative effect on customer experience in retail banking. This result can be explained by the assumption that the young sample might perceive SMS as rather outdated and not appropriate in such sensitive topics like financials.

Positive Effect on Net Promoter Score of Touchpoints

The support for the hypothesis is underlined by the significant change in the single NPS.

Although this effect is small to moderate, it can be concluded that implementing a recommender system at the touchpoints mobile app, online banking, and bank advisor leads to a significant increase in the number of ‘promoters’ and a decrease in the number of

‘detractors’ of the bank. This can be explained by customers feeling more supported and receiving relevant and personalised information via appropriate, personalised, and user-friendly touchpoints.