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No ‘digital banking’ in the mind of the consumer – just improved service


David-WebberDavid Webber, managing director, Intelligent Environments

BT recently released some research, surveying adults from across the UK, Spain, Hong Kong, France and Germany, to explore how these consumers view their digital banking services. The results of this survey led a few articles to conclude that the ‘vast majority of consumers’ are resistant to digital banking.

Digging deeper into the research it is clear that, despite the explosion in popularity of sites such as Facebook and Twitter, the findings do indeed show a significant lack of interest amongst consumers when it comes to engaging with their banks over social media channels. Instead, respondents listed things such as online peer review sections, webchat facilities, and ‘compare- my- bank’ type services as the best ways for financial organisations to give them better information and to help them make informed decisions.

Along with this demand for digital interaction, the research also found that respondents from every single market rated good online banking facilities, and the ability to access banking services 24 hours a day, seven days a week, as two of the most influential factors when considering moving banks.

Taking a step back, and looking at all the expectations that today’s consumer has, makes the headlines that appeared on the back of this research all the more surprising. Why? Because what are all of these services, if not fundamental aspects of digital banking?

As the headlines showed, too often the notion of ‘digital banking’ is limited to social media and mobile – a dangerous approach, given today’s increasingly channel-savvy consumer, to whom digital banking is becoming increasingly important. To talk about ‘mobile’, ‘social’, or ‘online’ banking is to make unnecessary distinctions under the umbrella term of ‘digital banking’. If these terms are considered as separate for too long they will ultimately hold banks back from providing the seamless, intuitive, ‘anytime, anywhere’ experience that customers demand. The clue is in the fact that consumers rarely talk about ‘digital banking’. They do not think in terms of ‘innovation’ or ‘a digital strategy’; they see a gradual transition to greater convenience and ease of use.

Statistics compiled by Intelligent Environments last year found that 51% of Britons confirmed that an effective digital banking service is a key driving factor in loyalty towards their bank. This figure highlights just how great a focus banks need to place on ensuring that their digital solutions meet their customers’ increasingly high expectations.

Customer loyalty is an aspect of the banking experience which will be thrown into sharp relief when the Vickers account switching regulation, due in September, comes into force. It is important to note, however, that the regulatory reform alone will not create competition in the market. But what it will do is lower the barriers to competition, opening up the playing field for providers who are able to develop a sufficiently different offering for customers to feel compelled to switch. The ability to choose and easily switch between different providers will be left as nothing more than an administrative formality, but if customers don’t feel that the options open to them are different enough to warrant the move then they will not do so, irrespective of how easy it may be. Banks will no longer be able to rely on having customers ‘locked in’, and loyalty will no longer be about the length of time with a bank but the level of ongoing engagement.

The benefits for banks of this focus on engagement extend far beyond customer satisfaction, to provide a valuable source of revenue enhancement. A customer who regularly interacts with their bank across the various channels is a much easier customer to alert to relevant products, promotions and services.

Of course it is not just about rolling out a ‘digital’ solution for the sake of it. Banks must work hard to deliver features that customers did not even realise were possible, and which can be accessed across multiple digital channels, in line with their digital lives. They need to be able to look into the future and predict, or, even better, define, what their customers will want in the coming years. As customers interact with their banks across a range of digital channels, the opportunity for data capture and analytics to inform customer engagement strategy is significant. With the right technology, banks can use their digital banking platforms not only to alert their customers to relevant banking products, promotions, and services, across all their devices, but also to log the details of these customer interactions and use them to create more relevant and personalised communications with customers. To do this effectively, it is crucial that a bank can take a single view of customer communications, allowing for the joined-up messages across devices that customers demand.

Data is an invaluable tool for analysing customer behaviour, though therein lies its key drawback –it analyses how customers behave now and how they have behaved in the past, rather than looking ahead to predict how they might behave in the future. Of course, existing data is a useful platform from which to anticipate future patterns and trends, though the personal and customised experience that today’s customer expects must be based not just on data, but also on psychology – banks need to look beyond the numbers to understand ‘why’. For example, to measure customer engagement success based simply on the average length of time customers have stayed on the website and the number of pages they have navigated to within the site would be to ignore the fact that it may ultimately have been an unsuccessful interaction – perhaps they stayed so long on the site and visited so many pages because they were unable to find what they were looking for.

Customers are becoming increasingly channel-agnostic, and banks cannot afford to focus their attention solely on mobile or online, or indeed the branch. Customers crave a connected conversation with their bank, for which banks must provide an integrated offering.



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