How can banks rise to the omnichannel challenge?

By Frans Labuschagne, UK & Ireland Country Manager, Entersekt

Banks should follow in the footsteps of other innovative consumer-focused industries to deliver an omnichannel banking experience that is relationship-focused, interactive, relevant and personal.

Frans Labuschagne
Frans Labuschagne

Never has technology accelerated changes in consumer behaviour so quickly that whatever is cutting-edge today becomes tomorrow’s status quo. And, consumers’ expectations of digital services and platforms change even more rapidly.

For example, consumers are no longer completely satisfied with having content available digitally and on demand; they want personalised suggestions specifically tailored for them. And why shouldn’t they? They expect the same from their social media platforms, where personalised ads are as familiar now as they were once disconcerting.

In fact, today’s mobile-first society enables personalisation on a scale never seen before, which has transformed consumer habits – from how they spend their free time to how they plan vacations, where and when they shop, and even how they manage their homes.

New age banking

Banking customers are no different when it comes to managing their money. They expect to access their information, and perform an ever-expanding list of banking actions anywhere, anytime and on any device. They expect their bank to meet their individual needs and preferences in the same way that their media streaming service or favourite big tech company does. With these expectations, they’re challenging what banks do, why they do it and how it’s done.

Large-scale changes in the banking landscape mean that consumers are spoilt for choice, and recent studies indicate that many would even consider going over to the competition – including to non-traditional players – if their current providers fell behind in service delivery and no longer met their expectations.

Meeting customers’ expectations no longer hinges on a multichannel strategy per se. Although 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, however, is taking stock of their various channels and strategically considering how their customers use them, and what this reveals about their preferences.

 Taking lessons from retail

Traditionally, banks spend much of their time and effort ensuring accurate transaction processing, but they’re starting to recognise that there are valuable lessons to be learnt from industries, like retail, that place a strong emphasis on customer experience. Some of the world’s top-rated banks understood this years ago when they were still considered challenger banks. They succeeded in turning customer experience into a competitive advantage that resulted in increased market share and remarkable customer satisfaction rates.

For the retailers known for their customer-first perspective, it is their store of data that gives them the edge over their competitors. They know that every time a customer searches online from their computer or mobile device, or calls the customer service department, that customer leaves a digital trail. This data-rich trail leads to a more intimate understanding of that customer and therefore what it takes to provide them with more relevant services and offerings – the essence of contextual commerce.

Smart organisations recognise the possibilities that using data in this way opens up. Instead of having a handful of interactions with their consumers each month, they can establish meaningful, ongoing and highly personalised interactions every day.

 Mobile-centric

Ensuring that these exchanges are truly valuable to customers is not always easy, especially when a bank must simultaneously balance factors like cost, legacy systems and competition. For many banks, a digital-first, or even a digital-only strategy, seemed like the answer. After all, digital channels have great potential in terms of cost savings and keeping up with the competition. However, research indicates that satisfaction levels among digital-only banking customers is significantly lower than among digital-centric customers, i.e., those that occasionally also use branches. So, while leveraging digital channels is a must for any bank, losing sight of the importance of branches, and the opportunity they provide to personally interact with customers, can be detrimental.

So, how can banks provide the level of service consumers demand, through the channels they prefer, while managing to offer a consistent experience across them all? Leveraging the mobile device, a universal tool that consumers always have with them, could provide the answer.

If the mobile device could be leveraged to securely identify a customer to their bank, it could become the ideal way to build confidence in sophisticated technologies. And even though the mobile device is a digital tool, it could also enhance the customer’s in-branch experience. For example, customers could use it to check in at a specific branch, authenticate interactions and digitally sign documents. A phone also delivers contextual information about a consumer, such as their location, which can initiate highly relevant and interactive dialogues 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.

 True omnichannel means more than just many ways

Today, banks are starting to realise that a true omnichannel approach to banking means more than just providing multiple ways for customers 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.

In the financial services industry, we’re still in the early stages of digital transformation. As Millennials and Gen Z consumers start to make up larger portions of the workforce, there will be countless changes in the ways they will want to interact with service providers like banks. To meet all these changing demands, banks will need to think about their omnichannel capabilities, as well as the insights they can gain from their multiple consumer touchpoints, as a competitive advantage. In doing so, they can offer their customers the personalised experiences they have come to expect – no matter the channel