Banks Frustrate Consumers Who Want a More Personal Experience

Consumers — particularly Millennials — still require knowledgeable, personalized assistance when making banking decisions, but research reveals a disconnect between consumer expectations and the experience banks deliver

A massive study gauging consumers’ wants, behaviors and attitudes about banks shows there is a stark gap with the experience retail financial institutions are delivering. The survey, fielded by TimeTrade, examined the banking habits and perceptions of more than 1,000 banking customers in the U.S.

74% of respondents said they still visit banks at least five times a year. 43% of consumers report they visit their branch more than 10 times a year, while 31% visit their branch five to nine times a year. Why? Do they prefer branches? Or are they frustrated by the experience in digital channels?

Actually, it’s a little bit of both.

People like conducting many banking activities online, but not everything… especially when the digital experience doesn’t meet their expectations. When asked “What are the reasons you abandon online banking forms such as loan applications?” 45% of banking consumers rank security concerns as the top reason, followed by “I find I want expertise from a live banking associate” (32%) and “I am not sure if I am choosing the right options” (24%).

Consumers will give up on digital channels when they hit snags or shortcomings, then head straight for the reliable branch environment and the tactile dependability of paperwork. But there’s more to it. Consumers aren’t just abandoning digital when they get frustrated; many consumers still want personal interactions when dealing with banking matters.

While it may seem cost-effective from a financial institution’s perspective to drive people out of branches, banks and credit unions face the real risk of losing opportunities to build personal relationships with those consumers that still need the human touch. Perhaps some retail financial institutions, in their rush to embrace all things digital, have overshot consumers’ collective comfort level when it comes to self-service technologies.

According to the research, 61% of consumers are coming into a branch to open an account. Some banking analysts might say this indicates a problem, that better online account opening solutions are needed. But all these in-branch interactions afford better opportunities to cross-sell new accountholders. It can be much easier to assess and discuss a customer’s situation in person — and then present and explain the options — than it is doing so in digital channels.

“Despite the recent rise in self-service banking, the average consumer still wants individual, in-person assistance to make intelligent and informed financial decisions,” concludes Gary Ambrosino, CEO of TimeTrade. “To succeed in the current landscape, banks must focus on converting a consumer’s digital first touch into a highly personal in-branch visit.”

That consumers still want/need branches doesn’t imply the online tools financial institutions are using today are flawed or broken. It’s just the nature of financial retailing. Banking products can be somewhat complex, people are going to have questions, and money is such a deeply personal subject that some consumers want to look their banker in the eye. And this doesn’t just apply to grandma and grandpa either. 45% of Millennials favor banking in person, and they are 8% more likely to visit a bank to open an account or get a mortgage/loan than other age groups. 10% more Millennials also say they need assistance making a buying decision vs. other generational segments.

What does all this mean? “If customers are visiting branches less frequently, and if they are now more likely to visit for advice and support rather than transactions, then the industry needs to re-think the in-branch experience,” suggests David Kerstein, founder and President of Peak Performance Consulting Group.

Researchers in the TimeTrade study also surveyed banking executives. 46% of respondents said one of their top priorities is to redesign, modernize and transform their in-branch experience. 27% intend to invest in customer experience solutions for branches, including cross-selling platforms, self-service kiosks for handling transactions and even free Wi-Fi.

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Banks Say They Are Personal, But Consumers Disagree

Consumers do not feel they have a personal connection with their banking provider. More than half the respondents in the survey (60%) report they do not have a banking relationship with a member of the staff at their local branch.

Among business banking customers, their chief complaint is that they “feel the bank does not know me very well.”

And yet 47% of banking executives rate their institution’s ability to deliver a personalized experience as “excellent,” while only 8% describe it as “average.

In today’s connected society, the bar is set very high for customer experience, and the banking industry is no exception. The key to delivering a superior customer experience is to provide a more personalized service, as consumers are demanding that companies get to know them so that they may receive more tailored offerings and products. Leading financial institutions realize that providing a personal experience leads to a high-value banking experience that helps to acquire and retain customers.

“Financial institutions need to rethink their approach toward customer service,” the report says. “Personalization needs to happen across all touchpoints on all channels, and new technologies and applications that enable this must be taken seriously.”

Personalization Driven By Analytics

In this digital age, delivering a personal banking experience that differentiates and drives more business is going to take data. However, the data that banks and credit unions require to personalize the experience typically resides in disparate systems, each serving only one specific delivery channel and/or product silo. As long as this data remains siloed, TimeTrade says it will be extremely difficult to provide a superior and personalized banking experience.

According to the report, banks that take advantage of advanced analytics will be able to deep-dive into individual customers’ feedback and needs and be able to take action in real time to prepare for an in-person meeting and provide an enhanced customer experience.

“When banks share access to a 360-degree view of a customer’s interactions, their staff can quickly understand and respond to each request, providing seamless transactions regardless of the previous channels used,” notes Jenni Palocsik, Marketing Director of Retail Financial Services at Verint. “This insight can help mitigate the need for the customer to explain everything again. When this information is augmented with tools like knowledge management and case management, banking staff can help quickly and consistently resolve customer issues, as well as cross-sell appropriate products and services.”

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