The impact of digital technology on the banking industry is one of the hottest topics in the industry at present. But the fact is that while the pace of change is accelerating, the banking industry has already seen its fair share of disruption. Just a few years ago it was still common for most retail banking to be carried out in-branch, and as a result branch employees often built strong relationships with their customers.
Today, however, we transact most of our banking digitally, whether over a desktop, mobile, or ATM, and as such, the face-to-face contact we were used to in the past all but vanished. The challenge is that customers still want great experiences when dealing with their bank. Even if communication takes place mostly over email, SMS, social media, or the phone, account holders still expect to be treated as valued customers and recognized as individuals rather than simply a customer number. Indeed, if anything, today’s customers are more demanding than in the past and will frequently take to social media to vent any frustrations they have with their bank’s services.
One of the great questions facing banks today, therefore, is how they can deliver compelling customer experiences in the digital age. The answer to this question is important, as it links directly to wider business goals: whether refocussing on home markets, closing the gap on fintech disruptors, or looking to grow specific products (for example mortgages) the ability to win, engage, and retain customers is fundamentally important.
I believe there are three essential steps that banks should take to guarantee a competitive customer experience:
- Deliver new products faster. It’s a no-brainer: If banks can get new products or service bundles out to market more quickly than the competition, they’ll enjoy a competitive advantage. RBS, for example, put in place a digital core banking system that has allowed it to dramatically decrease the time it takes to get new products to market. By allowing it to define products by their attributes, RBS’s digital core enables it to more precisely and quickly improve its customer products.
- Focus on customer needs. Different types of customers have different requirements, and banks must tailor services accordingly. Take Standard Bank of South Africa as an example: It used mobile technology to welcome the unbanked into the banking sector. Its mobile bank representatives can now open a new account for customers in less than 10 minutes anywhere in the country, creating a huge new customer base for the bank. Taking a customer-centric approach in this way can therefore help banks tap into high-growth markets and dial-up innovation.
- Offer a true omnichannel experience. Today’s customers demand a seamless, joined-up banking experience. If they start a conversation on mobile, they expect to be able to continue it in-branch or on the phone. As The National Bank of Canada found out, the only way to enable such a seamless, omnichannel customer experience is to break down information siloes within the business. The bank therefore deployed a single, powerful, integrated customer relationship management solution that led to a 52 percent increase in customer satisfaction and enabled it to increase cross-sell opportunities.
By focusing on the customer and working outwards from there, banks can enable experiences fit for our digital age. The foundation is to put in place a digital core platform that can unite all the bank’s operations and ensure customers can get the services and information they want, the second they want it.
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