Why reducing effort improves business

Last week, P1’s team attended the brilliant NextGen Planners #Elements event. As part of the event, Shaun Drew , P1’s Platform lead, gave a talk on unlocking ease for customers and how ease of use is a cornerstone of customer satisfaction and something we aim for. While the event was generously attended, I wanted to share the principles of the talk as I think understanding ease isn't just for providers, it's applicable to advisers wanting to develop and grow their business.

The Metric of Success: Customer Effort Score?

Our journey towards becoming the most user-friendly investment platform is guided by the powerful metric of Customer Effort Score (CES). Unlike traditional satisfaction metrics, CES accurately gauges customer loyalty by measuring the ease of interaction with our services. Put simply, how much effort it takes you to complete a given activity. According to Gartner, customer effort is 40% more predictive of loyalty than satisfaction alone. Furthermore, the Harvard Business Review found that 94% of customers who report low effort are likely to repeat business. Additionally, 81% of customers who experience high effort speak negatively about the company. Reputation relies on effort.

?81% of customers who experience high effort speak negatively about the company. Reputation relies on effort.

What is effort??

Reducing effort requires understanding the specific goals of your stakeholders—both clients and staff. Appreciating their needs and proactively reducing friction is key. For example, Amazon Alexa home units, despite being advanced technology with the aim of making buying easier, are mostly used for simple tasks like setting alarms or playing music. This highlights the importance of understanding and addressing fundamental user needs, not your desires, before implementing technology solutions

Where is the effort?

To make life easier for a client you need to understand their journey and break down it down to milestone activities. For example, for an advised client these activities could be:

• Being onboarded: How easy is it for a prospective client to use your services? Do they have to print and sign anything? Personally, I hate having to wet sign anything. As I type, I’m submitting an insurance claim. I had to go to their online portal, fill out details, and then download a form to further fill in and post. It makes me want to move provider (remember that stat about high effort = negative referral…).
• Transferring old policies
• Annual Reviews
• Retiring…

For an internal stakeholder, paraplanner or admin, they could be:

• Getting notes from a client meeting
• Writing suitability reports
• Creating accounts on a platform

Measuring effort can be done through post-action discussions or simple questionnaires. Recording responses is crucial for gauging effort accurately. For instance, asking, ‘How easy was onboarding with XYZ firm?’ on a 1-5 or 1-7 scale can provide valuable insights. Tools like Jotform or Microsoft Forms can facilitate this process.

Using less effort

So, you’ve identified the processes, and you’ve started measuring; how do you improve it? There are serval ways this can be done:

Decrease Friction:

• Frictionless Digital Processes: Simplify transactions with straight-through processing and eliminate unnecessary steps like paper and wet signatures. Chasing posted forms is unnecessary effort when paperless processes exist.

• Integrated Technology: Use systems that work seamlessly together, reducing rekeying errors and improving efficiency.

Increase Visibility:

• Visibility and Transparency: Ensuring you and your customers have clear, accessible information. Putting the information they want where they seek it, do you have an app?
• Self-Serve Options: Empower clients to handle certain tasks independently, reducing the number of requests you receive. Low-effort interactions cost the provider 37% less than high-effort ones, decreasing repeat requests and escalations.

A commitment to low-effort

I hope you find these insights valuable and that they encourage you to consider the effort you ask of your clients at every step of their journey with you. At P1, we are dedicated to making life as easy as possible for you. Our innovations are focused on making life easy and reducing the time you spend on our platform; the less time you’re administering advice, the more time you have to dispense advice – it’s where your value is and it’s how you’ll grow your business.

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To end our newsletter on a different note and add a little fun, we've translated a financial service term or provider into emojis. This will be a regular feature, but as this is the first time running it, we thought we'd add something extra. The first person to reply with the right answer wins a bottle of champagne. We'll reveal the answer in the next newsletter. Good luck.

Thanks,?

Harry Webster?

Marketing

P1 Investment Services?

Emoji Quiz?

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