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The Future of Online Banking: A Culture of Change

In episode four of this multi-part series on the future on online banking, author Tim Bunch shows retail financial institutions the right — and wrong — ways to manage the never-ending cycle of change required in this critical channel.

By Tim Bunch, Web Strategist, Designer and Developer at CapEd FCU

Thus far in the “Future of Online Banking” servies, we have explored three of principles shaping the future. Here’s a quick recap:

  • Part 1 – Your online channel will be the flagship branch of your institution
  • Part 2 – In the online channel, you can know who your visitors are and automate cross-selling
  • Part 3 – The online channel will be device independent, merging mobile and desktop

These three points are going to require a great deal of change in the ecosystem of banking. The changes required will impact your core systems, your marketing, and indeed the entire banking experience. Financial industry executives need to have a system in place that allows change to not only happen, but also for it to become the new normal. In other words, don’t fear and resent change, embrace it.

Change… and Frustration

When it comes to online banking, nothing frustrates your visitors more than logging in one day and discovering that everything has changed. Their workflow has just been completely interrupted. It’s as if a mechanic accidentally left a wrench under the hood of their car, making a crazy, loud, rattling noise.

How do we introduce change without causing extreme frustration? First off, it’s impossible to please everyone. Let’s just get that out of the way now. However, with the proper approach, you can minimize the amount of irritation your visitors experience.

So let’s explore four specific types of changes and how to deal with them:

  1. Small, bite sized changes
  2. Singular, new features
  3. Larger, new feature sets
  4. Major system upgrades
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1. Small Bite-Size Changes: Release Early, Release Often

“Release early, release often” is a philosophy that encourages faster progress, but relies on strong communication between software developers, testers, and users. This is different from the usual time-based, calendar-driven approach to updates. Banks and credit unions should go ahead and use scheduled releases for major changes, but they should also deliver minor changes more often. This helps creates a culture of change,

By frequently introducing small bite sized updates and changes, your users become accustomed to little things changing. Hopefully these are all real enhancements and helpful to your users. Don’t change just for the sake of change. Change to enhance the little things. After all, it’s all of the little things that differentiate a luxury car from an economy car.

2. New Single Features: Progressive Enhancements

Progressive enhancement is a web strategy that applies web technologies in layers. The latest web browsers have greater capabilities, allowing programmers and designers to enhance the visitor experience. Older browsers then fall back to a decent, but not as rich, experience. The same principle can be applied to new features of Online Banking.

Instead of forcing a new feature on people, give it a soft introduction. Introduce the new feature and invite your current users to turn it on, or activate it. New users, on the other hand, would automatically receive all of the latest features you have to offer. This is a good approach for moderate changes, such as a single new feature. Adoption rates are like immediate visitor feedback. A high adoption rate may translate into a job well done, while a low adoption rate may cause you to rethink things.

3. Can I Interest You in an Appetizer? Handling Large Sets of New Features

If you’ve ever sat down at a nice restaurant for a meal, the server invited you to try an appetizer. These small dishes stimulate your appetite. If the appetizer is good, you to look forward to the main course. At the same time, appetizers take your mind off of how much time it takes to prepare your main dish, because you are momentarily occupied.

Whenever you have larger feature set changes coming up in your online banking platform, be sure to prepare an appetizer. This is something that is just a taste of the good things to come. It can’t just be marketing or information about what’s to come. This must be more substantial. It’s a little bit of functionality of your upcoming new feature set that makes them crave the rest of it. This will also generate free word of mouth advertising, as well as soften the blow of a bigger change.

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4. Major Upgrades: Trade-ins Welcome

We aren’t in the business of buying and selling cars in the financial industry. However, we do see a lot of people trading in vehicles to assist with a purchase and loan for a new car. Generally speaking, a trade-in will lower the amount of the loan and ease the buying process. Knowing that you can trade in your old car actually encourages you to buy.

Many credit unions and community banks still have their members and customers driving around in an old beat up jalopy they call “Online Banking.” Nevertheless, many folks find feel a deep sense of attachment to their old car online banking system. Even though it may smoke and sputter from time to time, they love it dearly. A forced release of a major online banking upgrade will violently rip them from the system they’ve grown to love.

Here’s a better way to handle it. Start by letting your users “trade-in” your old online banking for the new model. This approach lets them know that you care enough to give them the choice. When they feel ready, they can flip that switch and trade-in the old system for the new one. At the same time, there needs to be an “end of life” date set for the old system. Let your users know the date you will pull the plug. This will allow the more change resistant people time to process their loss and “say goodbye” to that crusty chunk of HTML.

The Bottom Line

The future of online banking hinges on building a culture of change. But, as we all know, change is hard — made more difficult by forgetting whom we are serving. Always put your audience front and center of any change that affects them. Give them the star treatment. After all, this is all for them.

Join the discussion! What tactics and methods do you use to ease consumers into change? How about internal members of your own team? Has it been easy getting everyone on board with the changes required in your online channel? Or has is been a constant battle?


Tim Bunch is a web strategist, designer and developer at CapEd FCU. As a web standards fanatic, he passionately pursues best practices in web design. Tim is also an avid WordPress developer, music maker and coffee drinker. If you’d like Tim to speak at an upcoming event, please connect him on Twitter or Google+.

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Comments

  1. An excellent piece and absolutely agreed with the slowly slowly approach. What it did do is make me think about not just users but also non-users.

    Applying the gradual recommendations would mean that over time changes(improvements)would be quite considerable.

    I wondered if banks are making enough of that fact when communicating to non-users to get them to resample online? My feeling is that they don’t and should.

    I would add “promoting to non-users” as another benefit of Tim’s approach. Have a 12 month cycle lapsed customer/non user recruitment blitz as part of the template of development.

  2. @Mark, all good ideas. Pulling in those people who perhaps tried it, but didn’t like it the first time around is important. So is grabbing the attention of non-members/customers with a killer online solution that is constantly improving.

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