The evolution of customer experience and technology in the pensions industry

By Ophelia Alex-Iwuanyanwu

Customer experience is the overall perception and impression that customers associate with a brand based on their interactions throughout the entire customer journey, from initial awareness to post-registration support. It encompasses every touchpoint and interaction experienced by a customer, which would include marketing, sales, customer service, and product or service usage.

Customer experience is crucial to organisations because, as it is often said, ‘Perception is Everything’. Hence, it is important for customers to perceive an organisation as caring, innovative, and forward-thinking. Moreover, with the introduction of digital technologies, customer interactions with organisations have become more intimate and fast-paced.

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In Nigeria, the financial sector has been at the forefront of the use of digital technology as a point of service, especially as commerce is tied to financial transactions. This becomes even more important as financial products are fast becoming commoditized and customer expectations have, in turn, become more sophisticated with emerging trends. This experience has evolved in the industry from the traditional methods of physical visits to branches to the introduction of technology-driven methods like query resolution via emails, the deployment of call centres for query resolution via telephony, SMS, mobile apps, and other social media platforms.

In the service industry, understanding customer needs is crucial for providing effective solutions. Let us briefly explore three key customer needs that reflect their attitudes, expectations, and desires towards products or services.

Functional needs: What does the product, service, or brand do, and what are its qualities?

Social needs: How does the use of this product or brand influence the way customers are perceived by others?

Emotional needs: How does this product, service, or brand make me feel?

While the pension industry as we know it today is relatively new, having been birthed only 20 years ago with the enactment of the Pensions Reform Act of 2004, the industry has seen a significant evolution in customer experience and technology integration. Investments in digital technologies have become critical to remaining competitive. It is a well-known fact that organisations that provide a great customer experience record faster growth, stable retention, and better brand capital. Therefore, to achieve these three key objectives, industry players need to look more closely at how they can use technology and digital capabilities to manage their organisation’s service delivery, capitalise on these opportunities, and enhance even further their customers’ experiences.

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There is a rapidly growing tribe of digital natives (millennials and Gen Zs, Alphas, and soon-to-be Betas) that form an increasing proportion of the active contributors’ bucket in the pensions industry. Taking Nigeria as an example, its huge youthful population presents an opportunity for a steady source of pension contributions. These ‘natives’ experiences on their devices, relevant insights tailored to them, customised dashboards, and access to pertinent tools across sectors lead to elevated expectations. Instant gratification is no longer just a concept but is now a stark reality that demands a carefully curated response from organisations hoping to retain their customers’ loyalty. Expectedly, these ‘natives’ demand similar kinds of experiences that they have become accustomed to from their pension providers.

In seeking to deliver better experiences to customers, PFAs need to adopt a ‘platform’ approach by offering a myriad of services and capabilities. As mentioned earlier in this write-up,. Traditional pension management has shifted more towards user-friendly digital platforms, offering self-service options, personalised retirement planning tools, and real-time access to account information.

Technology such as AI and machine learning is being used to provide recommendations for retirement savings. Mobile apps and online portals have become common, allowing customers to manage their pensions conveniently from anywhere. Overall, the focus has been on enhancing accessibility, transparency, and efficiency in managing retirement funds, ultimately improving the customer experience in the pensions industry.

The ‘platform’ approach also allows for the integration of technologies to manage organisational internal capabilities such as core business processes, data, and analytics while constantly improving the customer experience. It can provide end-to-end, seamless service delivery that meets the demand for customer satisfaction. It offers a means to reduce organisational complexity and embraces a simplified digital operating model that is agile and efficient.

Unlike in traditional models, digital solutions and technology are now at the heart of the business. Digital technology can help a pension company become more competitive in several ways: Streamlined Operations: Implementing digital tools and automation can streamline administrative processes, reduce overhead costs, and improve efficiency.

Enhanced Customer Experience: Digital platforms can provide self-service options for pension members, such as online account management, retirement planning tools, and personalised advice, leading to higher satisfaction and retention rates.

Data Analytics: Leveraging data analytics can provide insights into customer behaviour.

investment trends, and risk management, enabling more informed decision-making and tailored product offerings.

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Mobile Accessibility: Offering mobile apps and responsive websites allows customers to access their pension accounts in real-time, anytime, anywhere, improving convenience and accessibility.

Personalised Communication: Using digital channels, such as email marketing and social media, enables targeted communication campaigns tailored to specific customer segments, increasing engagement and loyalty.

Cybersecurity Measures: Implementing robust cybersecurity measures to protect sensitive customer data and prevent fraud enhances trust and confidence in the company’s services.

Innovation and Product Development: Embracing digital innovation allows for the development of new products and services, such as digital investment platforms, robo-advisors, or pension planning apps, catering to evolving customer needs and preferences. It also creates room for integration into the wider financial ecosystem, such as banking services, payroll/outsourcing companies, etc.

By effectively leveraging digital technology, a pension company can stay ahead of the competition, improve operational efficiency, and better serve its customers.

It is important to note that these technological capabilities will need to be supported by human resources and the organisational culture of innovation and entrepreneurship to be truly successful in achieving the desired goal. While we may not be able to predict how customer needs will evolve in the next 15 years, with the right digital strategy, organisations will be able to adapt to the fluidity of customer and market requirements. Overall, prioritising customer experience is essential for organisations looking to thrive in today’s competitive business landscape by fostering customer loyalty, driving revenue growth, and building a strong brand reputation. Digital technology is the tool to achieve this worthy goal and infuse more customer confidence in the capabilities of the industry.

Alex-Iwuanyanwu, vice president, Customer Experience Access Pensions Limited