Trust Amid Volatility: Leading Stockbrokers Reveal 9 Ways to Boost Customer Retention & Lifetime Value

Prashanth Kancherla

Jul 24, 2023 | 8 mins read

From March 2019 to September 2022, the number of investors in Indian stock markets doubled, and in this period, top brokerages opened nearly a million demat accounts (a dematerialized account that holds financial securities digitally). What is really interesting is that nearly 75 percent of the investors in these accounts are below 30 years of age.

What do these new-age investors expect when it comes to communications and customer experience?

According to experts, it all boils down to trust and transparency.

At a recent webinar, ‘Enabling Seamless & Effective Client Communication in Stockbroking’, industry insiders and thought leaders joined us to discuss how brokerage firms can carve this trust and transparency into their customer experience roadmaps.

The panelists included:

  • Vikas Mathur, Head-Strategic Partnerships, Religare Broking Ltd 
  • Swapnil Kasar, Associate Vice President Customer Service- PCG, Kotak Securities
  • Jigar Pandit, Business Head- Commodity & Currency, Sharekhan
  • Jagjit Singh Chowdhury, Regional Head, India (West), Ozonetel Communications

In this article, we share key insights from the webinar on how brokerage firms can make investing an easy, effortless and reassuring experience for their customers.

How to ReAlign Customer Experience Strategy to Meet Customer Expectations

  • Prioritize Trust and Transparency 
  • Respond Faster 
  • Take the Long View on Customer Service 
  • Be Proactive with Security 
  • Let Customer Journeys Determine Your Roadmap 
  • Focus on Customer Relationship Management
  • Train and Enable Your Agents 
  • Be Available

Prioritize Trust and Transparency

“In broking, trust is the key ingredient. It is the glue of effective communication. Customers expect broking houses to provide them with the right answers at the right time.”

Vikas Mathur, Head- Strategic Partnerships, Religare Broking Ltd

Approximately 83% of consumers say they wouldn’t do business with a brand they do not trust. 

Trust is a reciprocal behavior that customers show toward financial businesses they choose to work with especially when it involves their hard-earned savings. 

Investors need to trust their stockbrokers to be empathetic to their needs, transparent in their dealing, and proactive in their communications. According to Vikas, trust is built when broking firms send customers the right message at the right time.

When investing, trust is also about setting the right expectations. Jigar Pandit explains, “The expectation of the customer is to make money with little risk.  Setting the right expectations is essential.” He recommends using lucid language and being transparent in your communications.

Moreover, how quickly a brokerage firm understands customer queries and generates trackable tickets is also critical for trust-building. Customer retention is deeply rooted in the foundation of trust, especially in the context of brokerage firms. By upholding empathy, transparency, and responsiveness, brokerage firms can not only retain existing customers but also attract new ones who seek confidence and reliability in their investment journey.

Respond Faster

“We belong to a very dynamic industry. Customers are investing their money and there is a lot of emotion bound to it.”

Swapnil Kasar, Associate Vice President Customer Service – PCG, Kotak Securities

Today’s customer is impatient. They want quick answers. 

Swapnil explains that when it comes to customer service, you are mostly dealing with irate customers.  And timely communication is very important for them. She explains how at Kotak Securities they’ve built a model where high-value clients can directly connect with the broking firm and immediately get a resolution. It minimizes the turnaround time (TAT) in responding to the client.

According to her, a well-defined escalation matrix and strict turnaround times is the key to a successful customer service experience.  

And, for stockbroking firms, designing this stellar customer service experience is vital. 

“Today,” explains Swapnil, “an irate client will simply post a negative review on social media, and this becomes one of the strongest references for people.”

But this isn’t all. Vikas Mathur goes on to explain how a myopic view of customer service experience can damage your long-term revenue opportunities. 

Take the Long View on Customer Service

“Customer service is not only for when something goes wrong. This is a limited view”

Vikas Mathur, Head- Strategic Partnerships, Religare Broking Ltd

Customer service is no longer just about addressing queries or solving problems when something goes wrong. This limited view of customer service overlooks the fact that it can be a powerful tool for enabling financial planning, cross-selling, and customer retention. 

If you look at today’s investors, you may see a twenty-something person with a growing investable income. Can you imagine the lifetime value of this customer? By delivering the right customer service strategy and by finding ways to enable their financial planning, you can engage this customer, retain them, cross-sell, and multiply this lifetime value manifold.

That is why broking firms should view customer service as an engagement tool that is critical to building loyalty and revenue.

Be Proactive with Security

“Now with a click of a button, I can share information with thousands of customers. “

Jigar Pandit, Business Head – Commodity & Currency, Sharekhan

There is no trust without security. Today stockbroking companies can leverage commuication tools to actively help their customers fight phishing and other investment scams. 

“There are two things to do here,” says Vikas, “Educating the customers and taking appropriate actions proactively.” He explains how at Religare, the minute they come across phishing emails, they instantly take proactive steps to inform the customers, customer service teams, and relationship managers. Any training or help that these teams require is undertaken on priority, and immediately.

Let Customer Journeys Determine Your Roadmap

“While planning their omnichannel customer experience roadmap, broking firms need to consider different customer journeys: self-initiated, RM (relationship manager) initiated, and robot-assisted.”

Vikas Mathur, Head- Strategic Partnerships, Religare Broking Ltd

Over the past few years, investment in stocks, shares, and mutual funds has exploded in India. The customer base has increased from 50 million to 110 million over the past two to three years, with the number of accounts growing from 3.9 million to over 30 million.

Earlier the customer base was limited to a few metros and tier-1 cities. Customers were dependent on regional branches, with branch managers and regional staff as their primary points of contact. 

But today’s customer is different. A younger generation with a higher investable income is investing in the markets. Their age group and demographics are different. The technology they access is different.  They may be located anywhere, and are extremely comfortable with digital tools and channels.

As a result, explains Vikas, broking firms need to holistically rethink their customer experience strategies. While they might plan personalized service and relationship management models for an older, high-net-worth individual, they should also offer more digital, tech-enabled channels for a younger, low-budget investor.

Digital channels, AI (artificial intelligence), and automation are important — so are relationship management and one-on-one customer service. Stockbroking firms need to balance these concepts differently for different customers.

As the industry continues to evolve, firms must decide what type of customer they want to acquire while also prioritizing customer retention, understanding their needs and preferences and tailoring their solutions accordingly.

Focus on Customer Relationship Management

“You need to have the right people and the right skills to communicate.”

Jigar Pandit — Business Head – Commodity & Currency, Sharekhan

While agreeing that digitalization is changing the game for customer communications, especially amongst younger investors, Swapnil reemphasized the importance of one-on-one relationship management and customer service to meet customer expectations, especially for the older generation of investors. 

Jigar Pandit, Business Head of Commodity & Currency, Sharekhan, agrees and adds that having the right people in place is critical. “Relationship managers need to be skilled,” he says, “You need to have the right people and the right skills to communicate and clearly outline investment risks.” 

Train and Enable Your Agents

“What if your agent was aware of the customer’s problems even before they answer their call?”

Jagjit Singh Chowdhury, Regional Head, India (West), Ozonetel Communications

Having a well-trained, empathetic team of customer service representatives and relationship managers is the key to building trust and reassurance. Swapnil underlines the need for agents to empathize and understand the customer, “They need to be interested and take ownership of giving a resolution to the client.” 

She recommends listening carefully and reconfirming your understanding of the client’s problems. Repeating and reconfirming your understanding of the client’s issue is an underrated but highly effective tool in building empathy. She encourages her team to ask questions, to give firm timelines on when they will get back with answers, and to follow up with the client diligently.  

Jagjit Singh Chowdhury, Regional Head, India (West), Ozonetel Communications, further suggests that to build transparency with customers, you must also offer transparency to your agent. Especially when customers interact with your brand via multiple communication channels, your agents need a unified view of the customer whenever  they converse with them.  

“They should be able to see the journey your customer has been on and be able to stitch together their answers accordingly,” he says, “If the agent is aware of the customer’s problem even before they answer the call, it gives the customer a completely different (and better) experience”

Be Available

“As a broking house, we foresee a tremendous opportunity for broking. We see large participation, especially from millennials. To service and cater to those numbers, we will need a robust, strong digital platform.”

Jigar Pandit, Business Head – Commodity & Currency, Sharekhan

Did you know the impact of IT downtime and data disruption on your business operations?

Nearly 43% of organizations suffer from data loss due to IT disruptions. Approximately 25% of customers would never do business again with an organization after the first IT downtime. Depending on your business size and reputation, these lost revenue opportunities could completely wipe out your current and future sales prospects and hamper customer retention efforts.

Jagjit explains how Ozonetel helped it’s clients, some of India’s largest stockbroking and finance companies, ensure business continuity even through the recent COVID lockdowns. “We have all sorts of redundancies in place including telecom redundancy. Even if a telecom network fails, customer service continues unabated.

Jigar further explains that to handle high volumes and volatility, having a robust knowledge management system in place is essential. “I have to foresee what queries can be easily resolved. For those questions that can be easily resolved, the agent can quickly checkup and FAQ (Frequently Asked Questions) section. For those questions that cannot be resolved quickly, I will need to train a call center team. If there are too many calls, there needs to be a transfer from one facility to another.“

In Conclusion

The surge in new, young investors and advances in technology have inspired many stockbroking firms to step up their customer experience (CX). Building trust and transparency continue to be key CX goals, but the scale, speed, and communication channels have changed.

Today customers expect proactive communications, lightning-fast responses, a wide selection of digital  service channels, and more. 

Instead of a one-size-fits-all approach, stock broking firms must get real about who their customer is and tailor their strategy to suit them. This may mean balancing relationship management with digitalization. It could also mean viewing customer service as an engagement tool to build customer lifetime value. 

The strategies in this article touch upon some ways to realign customer experience to today’s reality.  Because when it comes down to it, effortless, reassuring, transparent customer experiences are the key to building trust, loyalty, and long-term revenue opportunities.

Effortless communication is built on the foundation of a powerful, omnichannel cloud platform. Book a demo today to learn how Ozonetel helps stock broking firms establish trust and transparency as part of their customer experience strategy. 

Ready to take control of your call transfer
experience for better CX outcomes?

Prashanth Kancherla

Chief Product Officer, Ozonetel Communications

Over the past decade, Prashanth has worked with 3000+ customer experience and contact center leaders...

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