IBM and KANA Study Shows Untapped Potential for U.S. Financial Services Web Sites To Better Serve Clients


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Armonk, New York and Menlo Park, CA – June 20, 2007 – A study of 72 top US financial institutions reveals a majority of banks, insurance companies and investment firms overlook their customer self-service Web site as a low-cost, effective channel to improve customer service and retention. The study, commissioned by IBM (NYSE: IBM) and KANA Software, Inc. (OTCBB: KANA.OB), comes at a time when financial institutions are looking for new ways to improve the customer experience for established customers and a growing population of younger customers that increasingly interact with businesses through e-mail, chat and the Web.

The study, “Service Done Right: Why Great Online Customer Service Matters More than Ever,” evaluated the usability of online self-service; escalation via multiple channels, such as e-mail, chat, telephone, and online collaboration tools; and the quality of responses received to e-mail inquiries. Ninety-five percent of Web sites did not provide answers to basic questions such as 1) what do you charge for canceling a check?; 2) can I make an insurance claim online?; and 3) can you buy and sell shares on the London Stock Exchange for me? Sixty-seven percent of firms did not provide satisfactory answers via e-mail and only six percent offered the ability to escalate inquiries to e-mail or telephone channels.

Financial services firms ready to implement new self-service channels face significant application integration challenges due to complex IT infrastructures that are siloed and run on multiple platforms from different vendors, each with unique data types and interfaces. As a result, integrated online channel development – including new Web 2.0 technologies such as instant messaging and blogs – is most often piloted versus rapid implementation across the enterprise.

“Having a timely, consistent experience across all channels significantly improves productivity, customer satisfaction and retention, particularly in the competitive world of financial services,” said Danny Turano, vice president, global financial services, KANA. “Delivering rich, targeted content and seamless escalation to assisted service channels are key enablers of sustained self-service adoption. We’ve found this will drive 80 percent resolution on first contact for escalated online interactions and improve customer satisfaction ratings by 90 percent.”

In the study, researchers benchmarked the overall quality of online customer service offered by each organization ranking companies in a quadrant according to their proficiency scores for a number of contact channels and effectiveness of each channel. Four percent scored in the top “Multi-channel Leaders” quadrant for having multiple and highly effective channels available to their customers. Twenty-five percent landed in the “Best Practice” quadrant for having only a few channels but using those channels effectively. Fifteen percent fell into the “Lip Service” quadrant; these companies had multiple access channels but they were ineffective. The majority of companies – 58 percent – fell into the lowest quadrant for lack of both the necessary online access channels or for having a channel that was ineffective.

“Firms that enable customers to easily answer their own questions online using searchable FAQs and convenient Web 2.0 capabilities such as social networking software and live chat can increase customer satisfaction and cross-selling opportunities,” said June Yee Felix, general manager, banking solutions and strategy, IBM. “Banking, insurance, and investment firms have an opportunity to leapfrog their competition by improving the online channel to establish a consistent experience and reduce pressure on other service resources such as call centers and branch offices.”

KANA and IBM continue to build upon a seven-year, cross-industry global strategic alliance in Banking, Insurance, Financial Markets, Telecommunications, Retail and Industrial sectors. The partnership provides clients with KANA’s industry-leading multi-channel customer service solutions, which enable the word’s largest organizations to transform the customer experience and differentiate themselves through the delivery of consistent, intelligent service across channels, including e-mail, chat, call centers and Web self-service. KANA solutions are developed and optimized on IBM’s System p and System x platforms running WebSphere and Information Management middleware.

For more information on IBM financial services solutions, visit .

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