Flevy Management Insights Case Study
Data-Driven Customer Care Strategy for Fintech in Competitive Markets


Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Customer Care to thoroughly analyze their unique business challenges and competitive situations. These firms provide strategic recommendations based on consulting frameworks, subject matter expertise, benchmark data, KPIs, best practices, and other tools developed from past client work. We followed this management consulting approach for this case study.

TLDR A globally operating fintech company faced declining customer retention rates due to outdated customer service processes and intense market competition. By implementing advanced data analytics and AI-driven automation, the company improved customer satisfaction and operational efficiency, but still fell short of its retention targets, indicating the need for further analysis of customer feedback and additional engagement strategies.

Reading time: 11 minutes

Consider this scenario: A globally operating fintech company is struggling to differentiate itself in a saturated market through customer care.

Facing a 20% decline in customer retention rates over the past two years, the organization contends with both aggressive competition from emerging fintech startups and traditional financial institutions pivoting towards digital services. Externally, rapid technological advancements and changing consumer expectations pose constant challenges. Internally, the company’s customer service processes are outdated and not scalable, affecting customer satisfaction and operational efficiency. The primary strategic objective is to transform customer care into a competitive advantage, thereby improving customer retention and satisfaction.



The fintech industry is at a critical juncture, where traditional boundaries are blurring due to digital disruption and evolving consumer expectations. Many fintech organizations, including the subject of this strategic plan, find themselves at a crossroads, needing to rapidly innovate while maintaining a high level of service to stay competitive.

External Assessment

The fintech industry is characterized by rapid innovation and intense competition. Understanding the market dynamics is crucial for strategic planning.

  • Internal Rivalry: The fintech sector experiences high internal rivalry with numerous startups and traditional banks competing for market share.
  • Supplier Power: Supplier power is moderate, with many technology providers but a few dominate the market, especially in cloud services and advanced analytics.
  • Buyer Power: High, as customers have low switching costs and high expectations for digital services.
  • Threat of New Entrants: High, barriers to entry are lower due to cloud computing and open-source technologies.
  • Threat of Substitutes: Moderate, with traditional banking services and emerging tech companies offering alternative financial services.

Emergent trends in the fintech industry include the growing importance of AI and machine learning for personalized financial services, blockchain for secure transactions, and a shift towards mobile-first consumer engagement.

  • Increased reliance on AI and machine learning: Offers opportunities for personalized customer experiences but requires significant investment in technology and skills.
  • Adoption of blockchain technology: Presents an opportunity to enhance security but poses a risk of falling behind if not adopted timely.
  • Mobile-first consumer engagement: Necessitates a shift in service delivery models, creating opportunities for growth but also risks if not executed well.

A STEEPLE analysis indicates that technological advancements and evolving consumer expectations are the most significant external factors impacting the fintech industry, followed by regulatory changes that vary by region.

For effective implementation, take a look at these Customer Care best practices:

Guide to Delivering Best-in-Class Customer Care (78-slide PowerPoint deck)
Customer Experience Transformation: Customer Care (22-slide PowerPoint deck)
View additional Customer Care best practices

Are you familiar with Flevy? We are you shortcut to immediate value.
Flevy provides business best practices—the same as those produced by top-tier consulting firms and used by Fortune 100 companies. Our best practice business frameworks, financial models, and templates are of the same caliber as those produced by top-tier management consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture. Most were developed by seasoned executives and consultants with 20+ years of experience.

Trusted by over 10,000+ Client Organizations
Since 2012, we have provided best practices to over 10,000 businesses and organizations of all sizes, from startups and small businesses to the Fortune 100, in over 130 countries.
AT&T GE Cisco Intel IBM Coke Dell Toyota HP Nike Samsung Microsoft Astrazeneca JP Morgan KPMG Walgreens Walmart 3M Kaiser Oracle SAP Google E&Y Volvo Bosch Merck Fedex Shell Amgen Eli Lilly Roche AIG Abbott Amazon PwC T-Mobile Broadcom Bayer Pearson Titleist ConEd Pfizer NTT Data Schwab

Internal Assessment

The organization has a strong technological foundation but needs to improve its customer service capabilities and processes to effectively compete.

Benchmarking Analysis against industry leaders shows that while the company is competitive in terms of product offerings, it lags in customer engagement and service innovation. This gap affects customer retention and overall satisfaction.

Gap Analysis highlights discrepancies between current customer service delivery and best practices in the fintech industry, particularly in leveraging data analytics for personalized services and automating routine inquiries to free up resources for complex issues.

The Jobs To Be Done (JTBD) Analysis reveals customers seek not only financial services but also guidance, security, and personalization in their interactions, areas where the company can enhance its value proposition.

Strategic Initiatives

  • Implement Advanced Data Analytics for Personalized Customer Care: Use data analytics to understand customer needs better and provide personalized advice and solutions. This initiative aims to increase customer satisfaction and retention by making every customer feel valued and understood. The source of value creation comes from deepening customer relationships and enhancing loyalty. This will require investment in data analytics tools and training for customer service representatives.
  • Adopt AI-driven Customer Service Automation: Introduce AI chatbots and automated service options for handling routine inquiries, allowing human agents to focus on complex customer needs. This initiative is expected to improve operational efficiency and customer satisfaction by reducing wait times and improving resolution rates. It will require investment in AI technology and integration into existing customer service platforms.
  • Enhance Mobile Customer Care Experience: Develop a mobile app that offers comprehensive customer service features, including AI chat support, transaction tracking, and personalized financial advice. This initiative targets increasing engagement and convenience for the mobile-first consumer segment. Required resources include software development and user experience design expertise.

Customer Care Implementation KPIs

KPIS are crucial throughout the implementation process. They provide quantifiable checkpoints to validate the alignment of operational activities with our strategic goals, ensuring that execution is not just activity-driven, but results-oriented. Further, these KPIs act as early indicators of progress or deviation, enabling agile decision-making and course correction if needed.


Without data, you're just another person with an opinion.
     – W. Edwards Deming

  • Customer Satisfaction Score (CSS): To measure the effectiveness of personalized care and automated service solutions.
  • First Contact Resolution Rate: An increase indicates improved efficiency and effectiveness in handling customer inquiries.
  • Customer Retention Rate: Improvement in this metric will reflect success in enhancing customer care and overall satisfaction.

These KPIs will provide insights into the impact of strategic initiatives on customer experience and operational efficiency, guiding further adjustments and investments in technology and processes.

For more KPIs, take a look at the Flevy KPI Library, one of the most comprehensive databases of KPIs available. Having a centralized library of KPIs saves you significant time and effort in researching and developing metrics, allowing you to focus more on analysis, implementation of strategies, and other more value-added activities.

Learn more about Flevy KPI Library KPI Management Performance Management Balanced Scorecard

Stakeholder Management

Successful implementation of strategic initiatives relies on the active involvement and support of key stakeholders, including technology partners, customer service teams, and the leadership team.

  • Technology Partners: Essential for providing the AI and data analytics solutions.
  • Customer Service Teams: Frontline employees who will utilize new tools and processes to deliver enhanced customer care.
  • Leadership Team: Provides strategic direction and allocates resources for initiative implementation.
  • Customers: The direct beneficiaries of improved service experiences, whose feedback is crucial for continuous improvement.
  • Regulatory Bodies: Ensure compliance with financial services regulations and data protection laws.
Stakeholder GroupsRACI
Technology Partners
Customer Service Teams
Leadership Team
Customers
Regulatory Bodies

We've only identified the primary stakeholder groups above. There are also participants and groups involved for various activities in each of the strategic initiatives.

Learn more about Stakeholder Management Change Management Focus Interviewing Workshops Supplier Management

Customer Care Best Practices

To improve the effectiveness of implementation, we can leverage best practice documents in Customer Care. These resources below were developed by management consulting firms and Customer Care subject matter experts.

Customer Care Deliverables

These are a selection of deliverables across all the strategic initiatives.

  • Customer Care Transformation Roadmap (PPT)
  • Data Analytics Implementation Plan (PPT)
  • AI-driven Service Automation Framework (PPT)
  • Mobile Customer Experience Enhancement Strategy (PPT)
  • Strategic Initiative Financial Impact Model (Excel)

Explore more Customer Care deliverables

Implement Advanced Data Analytics for Personalized Customer Care

The organization chose to implement the Resource-Based View (RBV) framework to guide its strategic initiative of leveraging advanced data analytics for personalized customer care. The RBV framework, which focuses on the organization's internal resources as a source of competitive advantage, was particularly useful in this context. It allowed the company to assess its unique capabilities in data analytics and customer insights as key resources that could be used to enhance customer care. The deployment of this framework involved:

  • Conducting an internal audit to identify and evaluate the company's data analytics capabilities and data assets.
  • Assessing the potential of these resources to provide personalized customer experiences and identifying gaps in current capabilities.
  • Developing a plan to enhance data analytics capabilities, focusing on areas that would directly improve customer care.

Additionally, the Value Chain Analysis was utilized to understand how data analytics could impact each part of the customer service process. This analysis helped in pinpointing specific activities where data analytics could add the most value and thus, where resources should be focused. The implementation steps included:

  • Mapping out the company's customer service value chain, from initial contact through to post-service feedback.
  • Identifying key data points that could enhance understanding and service at each stage of the value chain.
  • Integrating advanced data analytics tools into these stages to provide personalized customer interactions.

The results of implementing these frameworks were significant. The company was able to leverage its strengths in data analytics to provide a highly personalized customer care experience, leading to a marked increase in customer satisfaction scores. Furthermore, by applying Value Chain Analysis, the organization efficiently allocated resources to the most impactful areas, enhancing overall operational efficiency in customer service delivery.

Adopt AI-driven Customer Service Automation

For the strategic initiative of adopting AI-driven customer service automation, the organization applied the Diffusion of Innovations (DOI) theory to understand and accelerate the adoption of AI technologies within its customer service operations. The DOI theory, which explains how, why, and at what rate new ideas and technology spread, was invaluable for planning the rollout of AI-driven tools. By analyzing the characteristics of AI tools that could influence their adoption rate, the company was able to:

  • Evaluate the relative advantage of AI-driven customer service tools over existing processes.
  • Determine the compatibility of AI tools with existing customer service workflows and systems.
  • Implement training programs to reduce complexity and increase the likelihood of adoption by customer service staff.

In conjunction with the DOI theory, the organization also employed the Service-Dominant Logic (SDL) framework to realign its service delivery around the value created through interactive and collaborative processes. This shift was critical for integrating AI tools in a way that enhanced, rather than detracted from, the customer service experience. The steps included:

  • Identifying core service processes that could be enhanced by AI automation without diminishing the customer experience.
  • Developing guidelines for the interaction between AI tools and human agents to ensure a seamless customer experience.
  • Engaging customers through feedback loops to continually refine and improve the AI-driven service processes.

The adoption of AI-driven customer service automation, guided by the DOI theory and SDL framework, led to a significant improvement in operational efficiency and customer satisfaction. The strategic implementation ensured that AI tools complemented human agents, allowing the company to handle a greater volume of customer inquiries without sacrificing service quality.

Enhance Mobile Customer Care Experience

The organization embarked on enhancing the mobile customer care experience by utilizing the Customer Journey Mapping (CJM) framework. CJM allowed the company to visualize the end-to-end experience of a customer interacting with the customer care service via mobile channels. This comprehensive view was instrumental in identifying pain points and opportunities for improvement. The process involved:

  • Mapping out all touchpoints of the mobile customer care journey, from app download to post-service feedback.
  • Identifying moments of friction and opportunities to exceed customer expectations at each touchpoint.
  • Designing and implementing enhancements to the mobile customer care experience based on these insights.

Alongside CJM, the organization applied the Concept of Elasticity to understand how changes in the mobile customer care experience might affect customer demand and satisfaction. This economic principle helped in prioritizing features and services that would have the most significant positive impact on customer retention and satisfaction. The implementation steps included:

  • Assessing customer sensitivity to changes in the mobile app's features and functionalities.
  • Implementing A/B testing to evaluate the impact of new features on customer engagement and satisfaction.
  • Adjusting the mobile customer care strategy based on feedback and observed changes in customer behavior.

The strategic enhancements to the mobile customer care experience, informed by Customer Journey Mapping and the Concept of Elasticity, resulted in increased customer engagement and higher satisfaction ratings. By focusing on the entire customer journey and understanding the elasticity of customer demand, the company successfully transformed its mobile customer care into a key differentiator in the market.

Additional Resources Relevant to Customer Care

Here are additional best practices relevant to Customer Care from the Flevy Marketplace.

Did you know?
The average daily rate of a McKinsey consultant is $6,625 (not including expenses). The average price of a Flevy document is $65.

Key Findings and Results

Here is a summary of the key results of this case study:

  • Increased customer satisfaction scores by 15% through the implementation of advanced data analytics for personalized customer care.
  • Improved operational efficiency by 25% with the adoption of AI-driven customer service automation, reducing average wait times and handling more inquiries.
  • Enhanced mobile customer care experience led to a 20% increase in mobile app engagement and a 10% increase in customer retention rates.
  • First Contact Resolution Rate improved by 30%, indicating more effective and efficient handling of customer inquiries.

The strategic initiatives undertaken to transform customer care have yielded significant positive results, notably in customer satisfaction, operational efficiency, and customer retention. The implementation of advanced data analytics and AI-driven automation has directly addressed the company's objectives to make customer care a competitive advantage. The marked improvement in the First Contact Resolution Rate and the increased engagement through the mobile app are particularly commendable, demonstrating the success of these strategies in enhancing the overall customer experience. However, the results were not without shortcomings. The expected increase in customer retention, while positive, fell short of the ambitious targets set at the outset. This discrepancy suggests that while the initiatives improved the customer experience, additional factors affecting retention, possibly outside the customer service domain, need to be addressed. Furthermore, the implementation highlighted the challenge of integrating new technologies seamlessly with existing systems and workflows, which initially slowed down the anticipated improvements.

Given the mixed results, the recommended next steps should focus on consolidating the gains achieved while addressing the areas of underperformance. Firstly, a deeper analysis of customer feedback and retention drivers should be conducted to understand the gap in retention rates fully. This may reveal insights into other aspects of the customer experience or product offerings that require enhancement. Secondly, continuous training and development for customer service teams on new technologies should be prioritized to ensure the full potential of AI and data analytics tools are realized. Finally, exploring additional channels for customer engagement, such as social media platforms, could provide new avenues for enhancing customer satisfaction and retention.

Source: Data-Driven Customer Care Strategy for Fintech in Competitive Markets, Flevy Management Insights, 2024

Flevy is the world's largest knowledge base of best practices.


Leverage the Experience of Experts.

Find documents of the same caliber as those used by top-tier consulting firms, like McKinsey, BCG, Bain, Deloitte, Accenture.

Download Immediately and Use.

Our PowerPoint presentations, Excel workbooks, and Word documents are completely customizable, including rebrandable.

Save Time, Effort, and Money.

Save yourself and your employees countless hours. Use that time to work on more value-added and fulfilling activities.




Read Customer Testimonials




Additional Flevy Management Insights

Telecom Customer Care Strategy for Specialty B2B Services

Scenario: The telecom firm specializes in B2B services within the semiconductor industry and is grappling with a high volume of complex customer inquiries that lead to long resolution times and customer dissatisfaction.

Read Full Case Study

Customer Care Strategy for Ecommerce in North America

Scenario: The organization, a burgeoning ecommerce platform in North America, is facing significant challenges in maintaining customer satisfaction and loyalty amidst rapid expansion.

Read Full Case Study

Customer Care Strategy for Urban Transit Service in Competitive Markets

Scenario: The organization is a public transit agency operating in a densely populated urban area, facing challenges in maintaining high levels of customer care amidst increasing competition from rideshare companies.

Read Full Case Study

Customer Care Transformation for Electronics Manufacturer

Scenario: The company is a mid-sized electronics manufacturer in North America struggling with an outdated Customer Care model.

Read Full Case Study

Organizational Change Initiative in Semiconductor Industry

Scenario: A semiconductor company is facing challenges in adapting to rapid technological shifts and increasing global competition.

Read Full Case Study

Organizational Alignment Improvement for a Global Tech Firm

Scenario: A multinational technology firm with a recently expanded workforce from key acquisitions is struggling to maintain its operational efficiency.

Read Full Case Study

Direct-to-Consumer Growth Strategy for Boutique Coffee Brand

Scenario: A boutique coffee brand specializing in direct-to-consumer (D2C) sales faces significant organizational change as it seeks to scale operations nationally.

Read Full Case Study

Operational Efficiency Enhancement in Aerospace

Scenario: The organization is a mid-sized aerospace components supplier grappling with escalating production costs amidst a competitive market.

Read Full Case Study

Sustainable Fishing Strategy for Aquaculture Enterprises in Asia-Pacific

Scenario: A leading aquaculture enterprise in the Asia-Pacific region is at a crucial juncture, needing to navigate through a comprehensive change management process.

Read Full Case Study

PESTEL Transformation in Power & Utilities Sector

Scenario: The organization is a regional power and utilities provider facing regulatory pressures, technological disruption, and evolving consumer expectations.

Read Full Case Study

Balanced Scorecard Implementation for Professional Services Firm

Scenario: A professional services firm specializing in financial advisory has noted misalignment between its strategic objectives and performance management systems.

Read Full Case Study

Organizational Change Initiative in Luxury Retail

Scenario: A luxury retail firm is grappling with the challenges of digital transformation and the evolving demands of a global customer base.

Read Full Case Study

Download our FREE Strategy & Transformation Framework Templates

Download our free compilation of 50+ Strategy & Transformation slides and templates. Frameworks include McKinsey 7-S Strategy Model, Balanced Scorecard, Disruptive Innovation, BCG Experience Curve, and many more.