Technology has accelerated changes in consumer behavior to such an extent that today’s cutting-edge will be the status quo sooner than you can say “Blockbuster.”
Expectations of digital services and platforms change even more quickly. Having content available digitally and on demand no longer satisfies consumers. They want suggestions curated to their personal preferences. They demand the same from their social media platforms, and personalized ads are as familiar now as they were once disconcerting.
In fact, today’s mobile-first society caters to the expectation of personalization on a scale never seen before. This has come to transform consumer habits. This ranges from how they spend their free time to how they plan vacations, where and when they shop, and how they manage their homes.
Consumers of banking services fall into the same patterns. They expect to be able to access their information and perform an ever-expanding list of banking actions anywhere, anytime, and on any device. They demand services that meet their individual desires in the same way that they expect such from their media streaming service or favorite big tech company. With that, they’re challenging what banks and credit unions do, why they do it, and how it’s done.
No Relationship is Safe Given Rising Choice Range
Large-scale changes in the banking landscape mean that consumers are spoilt for choice. Multiple studies indicate that many of them would consider going over to the competition — including non-traditional players — were their current providers to fall behind in service delivery.
Improvements in that regard no longer hinge on a multichannel strategy per se. Multichannel banking has been around for years. It is no longer ground-breaking and certainly does not provide a competitive advantage.
What can give banks the edge is taking stock of their various channels and strategically considering how their customers use them — and what this reveals about customers’ preferences.
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Lessons Banks and Credit Unions Can Take from Retail
Traditionally, banks and credit unions spent a considerable amount of effort ensuring accurate transaction processing, but they’re starting to recognize that there are valuable lessons to learn from industries that have a strong emphasis on customer experience.
Some of the world’s top-rated institutions realized this years ago when they were still considered challenger brands. They succeeded in turning customer experience into a competitive advantage that resulted in increased market share and remarkable customer satisfaction rates.
For many retailers known for their consumer-first perspective, data gives them the edge over competitors. They know that every time a consumer touches a computer, searches for a store or product on their mobile device, or calls a customer service department, they leave digital breadcrumbs. This data-rich trail is a path to a more intimate understanding of that consumer and what it takes to provide them with more relevant services and offerings — the essence of contextual commerce.
Smart organizations recognize the possibilities that this opens up. Instead of having a handful of interactions with consumers each month, for example, they can initiate several personalized, highly relevant interactions every day.
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Mobile Devices Become Key to the Relationship
But ensuring that these exchanges are truly valuable to banking customers is not always easy, especially when simultaneously balancing factors like cost, legacy systems and competition.
For many banking institutions, a digital-first, or even a digital-only strategy has seemed like the answer. After all, digital channels have great potential in terms of cost saving and keeping up with the competition.
However, research indicates that satisfaction levels among digital-only banking consumers is significantly lower than among digital-centric consumers who occasionally also use branches. So, while leveraging digital channels is a must for any bank, losing sight of the importance of branches and personalized interactions with consumers can be detrimental.
This begs the question of how financial institutions can provide the level of service consumers demand through the channels they prefer while offering a consistent experience across them all. Leveraging the mobile device, a universal gadget that today’s consumers always have with them, could provide a solution.
If the mobile device can be leveraged as the means of securely identifying the customer to their bank, it can become an ideal way of building confidence in sophisticated technologies. And while the mobile device is a digital tool, it can enhance the consumer’s experience at the branch, too.
People can use it to check in at a specific branch, authenticate interactions, digitally sign documents and more. The phone or tablet also delivers contextual information about the consumer, such as their location, that can open up a highly relevant and interactive dialogue at key moments. In this way, the mobile device can become the portal to the other channels — a trusted and familiar key to an omnichannel banking relationship.
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Mobiles Become ‘The Remote’ for Omnichannel
Today, banks and credit unions are realizing that a true omnichannel approach to banking means more than just providing multiple ways for consumers to transact. It’s about a thoughtfully designed, seamless and consistent interaction between customers and their financial institutions across multiple channels, with each channel complementing the others.
The financial services industry remains in the early stages of digital transformation. As Millennials and Gen Z consumers start to make up larger portions of the workforce, a myriad of changes in the ways they want to interact with service providers like banks and credit unions will occur.
In order to meet all these consumers’ changing demands, financial institutions must regard their omnichannel capabilities as well as the insight they can gain from their multiple consumer touchpoints as a competitive advantage. Doing so, they can offer consumers the personalized experiences they have come to expect — no matter the channel.