Responding to the New Definition of ‘Convenience’ in Banking

The customer journey changes dramatically when convenience is defined by the simplicity of design and the ability to open and manage accounts online or with a mobile device. Banking can now be 'local' to digitally engaged consumers worldwide.

Digital has made the world easier to navigate and to make a global impression. People can log into Twitter and see people from all over the world — New York, London, and Paris — in a single feed. From this perspective, someone who posts from 20 feet away and someone who posts from 2,000 miles away appear the same. They’re all relatively equal online or on a mobile device.

The lesson for financial institutions … today’s digital consumer doesn’t view ‘convenience’ and locality the same as yesterday’s consumers.

The New Definition of ‘Convenience’

In the past, physical convenience mattered tremendously. Most consumers banked with financial institutions right down the street. As recently as a decade ago, it was the only way to easily deposit money or get a loan.

Today, consumers can open or expand relationships with a range of financial providers all over the world. They can choose to use (based in California), Lendio (based in Utah), Moven (based in New York), and so on. Each of these companies offer products that are incredibly easy to sign up for. And they’re all available with a few taps of a finger on a digital device.

This increased digital convenience poses a challenge for banks and credit unions that have previously based their value on being part of a the ‘local’ community. Today, local banks and credit unions tout their superior customer service and attention to community causes, and consumers may say, “that’s nice, but I’d rather just do all my bank with whatever institution provides the best digital experience.”

How should small institutions pivot to reflect the new definition of convenience in banking? Here are three suggestions:

1. Don’t Make Location the Primary Focus

There’s no need to run from your legacy, but it’s detrimental to make physical convenience the focal point of your brand identity. In one sense, it merely advertises to end users that your brand is small, and as Javelin Research has shown, digital savvy consumers tend to avoid smaller institutions.

In some cases, the remedy may require a rebrand. Washington Community Federal Credit Union recently set a powerful example on this front with their rebrand to Chrome Federal Credit Union. They knew they wanted to distinguish themselves from other financial institutions that have ‘Washington’ in their name, and they knew they didn’t want to limit themselves to what they had accomplished in the past.

“Our people were always big on helping our neighbors save, borrow and live better,” their new site says. “But we knew we could do more.” Their new focus is on providing a simple and solid digital experience, as you can see in the images before and after the rebrand.

Here’s a screenshot of their cluttered website right before they made the change:

Chrome Before

And here is a screenshot of their website now:

Chrome After

The cluttered, product-centered experience has been replaced by a simple, user-centered experience. Chrome Federal Credit Union is laying the foundation so they can function beyond the confines of their locality, enabling their brand to survive as they continue to expand into new markets.

2. Make it Easy and Attractive for Non-locals to Buy Your Products

It’s not enough, of course, to merely rebrand your institution. You must also have the ability to offer your products directly online or on a mobile device, regardless of someone’s physical location.

For certain institutions, including most credit unions, current regulation may limit your ability to expand dramatically on this front. However, by creating a way for account holders to sign up for your full range of products online and on a mobile device, you’ll be better prepared to navigate the transition to becoming a digital banking organization. You will have started the process of thinking ‘global’ rather than ‘local’.

Say that you expanded your digital loan volume so that 5% of total loans were from people who live beyond your physical bricks and mortar footprint. That 5% could make a notable difference years down the road — especially because more and more of your competitors (including fintech competitors) could be significantly impacting the loan market with digital applications. Carving out a place in this niche will be critical to remaining competitive going forward.

As you do this, your brand will become associated with digital innovation, signifying to consumers that you are well equipped to scale up your digital product offerings as devices continue to evolve. You will have made the leap from being viewed as a stodgy and behind-the-times institution to being forward thinking and ready for the future.

3. Restructure Your Marketing Efforts for the Digital Age

While digital advertising gives institutions the ability to geo-target consumers, this isn’t where digital networks thrive. As mentioned earlier, social media is impartial to location, throwing all posts and tweets into a single globally-engaged feed.

Because of this, content marketing and social media efforts become more important and will start paying off once your potential consumers have the ability to learn about your offering and sign up for your financial products directly online.

Here’s one way to funnel consumers to your products: Hire a digital copywriter and leverage the knowledge you already have on hand to create a series of useful blog posts about financial principles. Interview your employees, asking for compelling and personalized ways that each person teaches consumers about saving and lending.

Every employee will likely have a good story or analogy or statistic that they use when talking to prospects. This will serve as the core of the digital content, since the more the writer can infuse a unique voice into his or her efforts, the better. This also allows you to stand out in the crowded digital space.

You can then use social media to point to the best financial content on your site and across the web. As users from across the web start to value what you’re doing and saying (see the combined efforts of Bank of America and Khan Academy for an example), you’ll get more digital traffic and more people will see that your institution as a trusted source for their financial life.

With digital traffic generated, you’ll be able to draw attention to the savings accounts and loans you offer, which you should prominently display in either a sidebar or as a call to action at the end of relevant blog posts, always leading with your intent to help consumers live financially healthy lives. Combine this digital engagement with the ability to open and onboard a consumer quickly and easily (without coming to a physical location) and you have moved to becoming a global competitor.

Next Steps

The ‘shift to digital’ represents a new mentality, from being a local branch to being part of the new digital marketplace, impartial to physical location. A paradigm shift to ‘global convenience’ is the new mentality that all banks and credit unions need to embrace if they want to flourish in the digital age.

Hold too tightly to a legacy mindset — based on branches, billboards, and radio spots — and you’ll wake up one day and find that your consumers are all embracing brands that provide the ability to open and use accounts 24/7/365 without visiting a ‘local’ branch.

A full 90% of Millennials admit that they use digital banking channels more often than branches, and that’s a trend that’s only likely to become more pronounced in the future.

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