Similar to the banking industry, delivering a great customer experience in retailing is filled with challenges and opportunities. Retailers have had to reimagine how physical and digital experiences can complement each other across the entire customer journey, and how meaningful personalization can be supported whenever a customer engages with the brand.
With a shift to digital engagement and remote workforces accelerated by the pandemic, having a holistic view of the customer and delivering a humanized digital experience is no longer optional in retailing or in banking. With lower levels of activity, physical facilities are increasingly becoming hubs for closing sales and customer support, with mobile channels increasing in importance.
Also, similar to banks and credit unions, many retailers are increasing their focus and investment in customer experience, but are challenged by legacy back-office processes, limited real-time customer intelligence, and employee skill sets that are not yet prepared for a digital future. Despite these challenges, there are a handful of highly successful retailers who are well along the path of digital channel transformation. Below are some lessons from these leaders.
Channel Disruption in an Instant
The pandemic moved the vast majority of consumer interactions in all industries to digital channels. In retailing, as in banking, the need to engage with limited physical store (branch) support was immediate. Consumers expected both industries to quickly and accurately meet the customer’s needs in the moment, irrespective of whether the engagement was online, in-person, or combined. Consumers almost immediately became accustomed to new ways of researching, buying and transacting, and expectations around omnichannel experiences only increased.
As daily digital interactions increased, so did consumer expectations of sophisticated capabilities with simplified experiences. For retailing, it was the ability to easily find products, understand availability and enable fulfillment quickly and seamlessly. Similar to the banking industry, the ability to shift from physical to digital channels was done best by the largest brands, such as Best Buy, Target, Home Depot, and Walmart. For smaller firms, the shift to digital has lagged and the ability to invest in the needed technology has created a significant challenge.
Shift to Digital:
The smartphone has become the channel of choice for research, purchase and ongoing engagement in retailing and in banking. The key is to make interactions fast and simple.
To illustrate the similarities between mobile app experiences in retailing and what is needed in financial services, we reference a study by Forrester, made available by Airship. The analysis of mobile apps in retailing are surprisingly parallel to banking, including 19 functionality and 28 user experience (UX) criteria, such as:
- Utility. Can a consumer build a complete profile including channel and privacy preferences?
- Browsability. Are search and navigation paths intuitive?
- In-app merchandising. Is there strong product and service content available?
- In-app checkout. Is purchase process simplified with minimal fields and ability to complete transaction digitally?
- Search and navigation. Is site easy to navigate with offerings targeted to customer goals?
- Content. Is content contextual and easy to understand?
- Progress and workflow. Are cues used to direct the customer to next step with indications as to completeness of process?
- Error avoidance and recovery. Does the app help customers avoid and recover from errors?
- Privacy and security. Is privacy and security content easy to find and consume?
Best Practices in Retail Provide Insights for Banking
One of the challenges in the retail sector is that in-store and digital experiences have often been built separately. This makes the seamless integration of insights and the ability to deliver a seamless omnichannel experience challenging. This is the same challenge in financial services, where silos of data and legacy back office processes make it a struggle to simplify digital engagement.
These challenges are made more difficult by workforces not yet equipped to support digital engagement or not provided with the tools required for a redefined role. In many cases, they are working with outdated or incomplete insights to understand the customer’s needs.
In retailing, the big box leaders quickly improved their mobile experiences. Some of the noted best practices in the Forrester research that can be applied to banking include:
Get the search experience right. Because of the massive number of items sold in a big box retailer, it is difficult for a consumer to navigate quickly to the item they want. Similar to Amazon, the best retailers provide search bars, assisted by behind-the-scenes predictive search tools, relevant results, and contextual filters. Some retailers also include voice and visual image scanning.
The lesson for banking is that we need to make the website experience much easier and more intuitive. A consumer should be able to find a desired financial product as fast as they can find a big screen TV.
Provide a humanized help option. The best retailers make staff available to assist a consumer with their digital search and purchase activities. In 2020, 23% of US online adults said that offering live online chat on its website was one of the three most important tools a retailer could have to enhance their shopping experience. Some retailers even offer the ability to connect with local associates.
For banking, the challenge (and opportunity) are the same. We need to provide chat support for consumers wanting 1:1 support. Allowing a customer to connect with a local banker via the mobile app takes service to the next level.
Humanized Digital Engagement:
The shift to digital channels does not mean the omission of human engagement. But we must provide the tools to employees to help them succeed.
Understand where the consumer is in their journey. In retailing, if the customer is moving around the site, they should easily be able to ‘move backwards’ in their process, be able to access product reviews and have the ability to re-engage if a shopping process is abandoned.
In banking, consumers should be able to move around the site at ease, with comparison tools and the ability to stop and restart the process at any time. Banks and credit unions should also be able to reach out to anyone who stops a process and re-engage immediately.
Simplify ‘check-out’. The best-in-class retailers continually optimize their checkout paths to reduce friction points. This includes contactless payment and the ability to complete the purchase with either a delivery of the product or in-store pick-up.
The analogy in banking is that the consumer should be able to complete any purchase or transaction fast and easily on their phone. This includes all steps needed to open an account, get a loan, transfer funds, etc. That said, if the consumer wants to visit a branch, they should have that option also.
Include planning tools for ongoing engagement. In retailing, the most successful brands not only include planning tools for major projects or life events, they also have built collaboration tools for other people to share in the journey. These tools are very similar to the financial planning tools that some financial institutions are beginning to provide. Beyond simple (or project) budgeting, some banks and credit unions have created ways for customers to save for events, include friends and family in reaching goals, etc. This level of engagement builds long term loyalty.
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How to Improve Mobile Experiences
Every customer touchpoint and all back-office processes must work together to create a positive digital experience. Meeting customer expectations requires that organizations support omnichannel engagement and be able to have a 360-degree view of the customer journey.
Part of the experience must also be owned by customer support teams, both in physical facilities and in call or contact centers. To facilitate this interaction real-time insight into the customer journey must be available and actionable.
Where to Start:
To improve the mobile experience, start with making the most used functions best-in-class. Focus on simplicity and speed across the customer journey.
In Forrester’s review of mobile apps in retail, they stated, “Retailers must prioritize mobile app features that add customer value, and they must design and implement them for great user experience.” Obviously, the same parameters are true for financial service organizations. Forrester recommends that retailers do the following. It is our perception that the banking industry should do the same:
Build the basics flawlessly. Provide easy to understand and well-organized product detail. Mobile app design best practices also include intuitive navigation, simple engagement, and easy ways to access help. Understand what customers do most on your mobile app, leveraging user research and customer journey mapping to simplify task flows. Limit the steps needed to get from beginning to end.
Accommodate time strapped digital users. Many people using mobile apps prefer speed and simplicity. They want to get into and out of the mobile app as quickly as possible. Best-in-class brands assist digital natives by providing the best end-to-end experience, removing unneeded steps, pre-filling forms and avoiding the need to change channels. The top digital brands also provide visual cues to move the process forward and to let the consumer know where in a process they are.
Don’t avoid human interaction. Providing the best digital experience does not mean the omission of humans. According to Forrester, “Customers want to self-serve, but when all avenues are exhausted, they expect a human to be available to help. This human interaction can play a pivotal role anywhere in the customer journey, from product discovery all the way to customer service.” Bottom line, make it easy to get help from a live person if desired.
It is important for financial institutions to learn from other industries and to try to avoid the customer experience gaps other industries have lived through. The banking industry must address the most important performance gaps first, such as nonexistent search, a lack of self-service money management or financial well-being tools, the lack of human-assist options and hard-to-find security and privacy content.
Finally, don’t forget the importance of ongoing engagement. One way to encourage interaction is through alerts and proactive account management. Unfortunately, most financial services organizations put far too much burden on the customer to set up and manage their accounts.
In many instances, financial institutions have the data and behavioral information available to determine if a customer’s balances are too low based on historical trends, very similar to the way they can identify if card activity looks suspicious. Banks and credit unions can also move funds between accounts to maximize the value of the relationship on behalf of the customer. Much like Acorns and other automated savings tools, engagement (and loyalty) would increase if institutions used AI and machine learning to optimize fund flow between accounts.