Did you know that 70%* of Fortune 100 companies use the phone number as a primary customer identifier?
The phone number has steadily replaced traditional identifiers like the national identification number as the new way to identify individuals and small businesses. From mobile banking to virtually all digital native services, the phone number serves as a primary attribute that connects PII data, user profiles, and access devices. That said, an astonishing 50%* of identity records in these companies carry either stale phone numbers or, worse, no phone numbers at all. Inaccurate identity data severely hampers customer service experience for consumer-facing enterprises like banks and digital natives. Therefore enterprises need to not only cleanse their identity verification sources but also keep them continuously updated.
Identity tokenization can elevate digital servicing by improving customer service while respecting data privacy.
The Adverse Impact of Bad Identity Data
The quality of customer identity data within an enterprise is a key factor in servicing customers efficiently—be it on digital or assisted channels. According to a Microsoft survey, 72% of customers expect customer service agents to know their contact & product information and service history the very moment they start engaging with a brand. However, this basic task becomes a challenging ask for organizations due to the following reasons.
Quality of Identity Data: Data quality issues stem from incomplete and stale personal information linked to customers. A less-than-ideal onboarding process can lead to insufficient contact information being supplied by customers. Further, contact information such as phone numbers and addresses may change during the customer lifecycle. They may add or disconnect phone numbers. Failure to update these changes quickly makes the identity data store stale.
Fragmentation of Identity Data: A centralized master data system that serves as the golden source of customer identity data is a holy grail that every company seeks. The reality, however, is a mesh of applications, each holding custody of contact data with various levels of accuracy. Add to that a lack of coherence in architecture and integration between customer touchpoints and identity sources—this fragmentation causes inconsistency in customer service and experience across channels.
Vulnerability to Fraud Caused by Bad Contact Data: Stale data increases the risk of identity theft. Data from the FCC shows that over 35 million phone numbers in the US are disconnected and reassigned to a new subscriber every year. With many privacy-sensitive services like banking and instant messaging connected to phone numbers, reassigned numbers pose a high risk of fraud to their original owners. With an increasingly mobile workforce failing to update contact information, this risk increases manifold.
Poor customer experience, higher operational costs, high risk of fraud, and loss of revenue are the direct consequences of bad customer identity data. In the absence of reliable contact information, call centers experience increased handle time. Unable to greenlight more users, digital self-service channels return a higher number of false positives.
Tokenizing Identity to Solve Customer Experience Challenges
Identity tokenization provides an elegant solution to the problems posed by the quality and fragmentation of data. It enables a single point of reference to recognize and authenticate customer identities across multiple parts of a customer journey. As a result, it serves as a powerful alternative to the expensive pursuits of centralizing customer master data for many digital servicing use cases.
Tokenizing identity requires creating a reliable repository of identity tokens that represent the contact information and personal details of customers. In doing so, missing or stale contact information and identity data are added or updated, creating a clean database of PII records. The token registry is subsequently kept afresh in an automated manner against dynamic changes to personal information, including phone numbers, fetched from multiple verified sources. Customer service applications and service automation tools across business lines in an enterprise can integrate with this registry that serves as the hub for true identity data.
Here are some of the tangible benefits of tokenizing identity (as observed from the use of Prove Fonebook™) at tier 1 banks in the US.
Improved Customer Experience: A single source of true identity creates a consistent omnichannel experience for consumers in customer service interactions. Call centers can reduce average handle time, and digital banking channels can greenlight more customers. With a higher level of confidence in contact data, organizations can streamline periodic customer communication. Companies can be more confident that targeted offers will find their intended audience.
The call center at a tier 1 bank using Prove’s identity tokenization platform significantly improved their number match rate and cut down call waiting time.
Significant Revenue Uplift: The accuracy of personal and contact information that a tokenized registry provides can improve cross-selling and upselling to existing customers by accelerating the origination process in digital channels. Higher levels of customer satisfaction rendered by better customer experience, engagement, and communication can prevent attrition, thereby improving customer lifetime value (CLTV). Research done by SiriusDecisions shows that companies with “high data quality management” generated 66% more revenue than companies with insufficient data quality strategies.
Clean, tokenized identity data significantly reduces the risk of identity fraud. Enterprises can leverage higher confidence levels to improve pass rates, thereby plugging revenue leakage.
OPEX Savings: With the presence of a single repository of identity tokens that all business lines and operating channels can rely upon, organizations could consolidate their identity authentication application landscape, saving significantly on operating costs. It also helps rationalize the identity & authentication architecture and standardize customer service operating models, both delivering higher efficiency gains. In addition, better pass rates for assisted service channels like the call center can be translated to lower personnel costs.
A tier 1 banking customer of Prove saw an immediate benefit of $14 million in OPEX savings by implementing Prove’s platform.
Prove Fonebook™ is a registry of tokenized customer identities that manages, adds, and updates customer identity information, including phone numbers. Fonebook leverages Prove’s PRO™ model of identity verification and authentication.
Organizations have reaped big productivity gains by implementing Fonebook. For example, a tier 1 issuer in the US saw an ROI of $36 million by improving the quality of its identity data using Fonebook. The impact of Prove’s solution was on multiple use cases across customer experience, digital servicing, and assisted service channels.
*Source: Prove proprietary research based on public data available from Fortune 100 companies and Prove proprietary data.
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