min read
July 21, 2017

5 Realistic Strategies in Omni Channel Banking

Customer Experience
Digital Trends

Over the past century, iconic neoclassical buildings have been the symbol of stability and grandeur that banking can lay claim to. But, with consumers becoming increasingly sophisticated in digital banking, the customer experience of physical bank branches find themselves in decline as focus shifts to technology and mobility. In 2016, 62 percent of Americans cited digital banking as their primary method of banking, an 11 percent increase from the previous year.The traditional teller exchange has become an antiquated hassle of the 20th century.Modern bank customers gravitate to offerings that make bank services available remotely and universally, pressing banks to be more customer-conscious to answer that call. Banks now have to think beyond the transactional part of their business and appeal to the consumer demand for expanded omnichannel experiences.

Through Multi into Omni

According to IBM, multichannel experiences are no longer a competitive edge, but a "ticket to compete" for banks: a strategic prerequisite for the new era of a digital transaction.But how do banks achieve a true omni-channel experience? Banks that are transitioning to a full omnichannel experience for their customers are aware of the pitfalls and complications involved in the adoption of this process. Many large banks have siloed layers of their organization, hence why seamless customer experience across all channels is hard to deliver.Banking is fundamentally a complex SOA (service oriented architecture) of many different systems, unifying the different areas of the organization that manages discrete parts of the customer experience can be problematic. From the bank’s perspective, a customer's checking accounts, mortgages, credit cards might each have their own system within the organization, but customers don’t think in “systems” they think in terms of convenience and ease-of-use.In looking at the current banking landscape, early adopters of new technologies to create a more seamless, end-to-end experience for their consumers is underway. Here are five ways that banks are currently competing in the digital arena.

Customer Experience Future is Mobile

Mobile banking is at the center of this digital revolution, and so it's little wonder that investment in mobile banking is soaring. 65% of banking customers use more than one channel with their bank, and, with bank branches proving themselves as less than completely dispensable, usage of in-person (or offline) channels will continue to decrease as digital channels diversify.Bank of America has eliminated hundreds of their brick and mortar branches in 2016, shifting focus to "self-service channels in mobile, online and ATMs," as their CFO Paul Donofrio recently told Business Insider. Donofrio went on to suggest this development is better for both their clients and shareholders, as a mobile transaction show a 90% increase in cost-savings when compared to and in-branch visit.A key result of the increase of digital channels has been the launch of highly touted mobile app experiences for bank customers. Born via a partnership with American banks and credit unions, Zelle allows the customer to send and request money with as little as a phone number or email address. The peer-to-peer money transferring service integrates with existing banking apps and is serviced as a standalone app which will be released later this year. Zelle seems to be an answer to Venmo and Apple’s iMessage, suggesting that Bank of America, and 30 other participating financial institutions, will be able to do casual transactions with the same assurance.

ATMs That Connect to You

In March, Wells Fargo introduced a new way for customers to withdraw money from ATMs. Their Near Field Communication (NFC) technology, built into their mobile app, enables customers to withdraw money at an ATM directly from their phone, as part of a "cardless" ATM transaction. By activating the app on a smartphone near the NFC ATM and providing their PIN number, customers can complete a transaction without any further credentials or hassle.Jonathan Velline, Executive VP and Head of Branch & ATM Banking at Wells Fargo, claims "the real power of mobile is the ability to enhance the customer experience at our ATMs and branches.” And with over 13,000 ATMs and 20 million customers worldwide, Wells Fargo sees this innovation as a means of engaging with customers in their preferred way, in the process realizing the vision of a cardless future.

The ITM Revolution

BankOn Mobile Video, a company that creates interactive video solutions for banks, is entering the initial stage of what they conceive to be the Interactive Teller Machine (ITM) revolution. They want banking experiences to be customer-friendly and efficient, while also designed to mirror the workflow of a typical bank teller exchange. The ITM gives the customer the ability to interact with a bank teller through video, adding teller functionality to the standard suite of ATM services.BankOn wants to position itself within the industry catering to the 80% of banks that are projected to use video for banking services by the end of 2018. Gene Pranger, founder, and CEO of BankOn, believes that the “best possible experience for customers involves migrating people to start using other channels,” and, with BankOn rolling out their recently-patented video chat technology later this year, that migration is well underway.

Protection On the Go

CitiBank’s Global Cards customer experience team has identified three areas that can be optimized in order to put their customers first:

  • Make customer interaction with the company simpler
  • Make their lives easier
  • Minimize customer anxiety or pain at the prospect of banking

In step with that mission, an element of the new functionality added to CitiBank’s mobile app last year was Citi Quick Lock, which allows any customer with a CitiBank credit card to "lock" their card directly from mobile, providing them immediate relief from the anxiety of a lost or stolen card.With Citi Quick Lock, customers can take a simple precaution through the app without ever calling into the bank, and the card can be later unlocked with the same ease. The app also allows cardholders to dispute charges, view statements and track their new card - reducing this previously high-touch interaction with the bank down to a few clicks.

Removing the Human Element Entirely

One of the most compelling new technologies to sweep the investment banking industry is the robo-advisor: an automated, algorithm-driven financial planner that expands digital channels available to the consumer in a whole new way. The technology, which surveys the client’s financial situation and uses the data to assess and invest client assets, has significant implications for the future of financial planning services -- not the least of which being that robo-advisors must be registered under the same legal and regulatory terms as human ones.Robo-advisors such as WiseBanyan and Schwab Intelligent Portfolios from Charles Schwab now offer a "zero fee" structure to attract new investors. The latter constructs a custom portfolio based on responses to a risk-assessment questionnaire, incorporating automatic rebalancing and tax loss harvesting where needed. Robo-advisors that charge a flat fee are significantly less expensive than their human counterparts, and accessible whenever and wherever the user needs their services.

A Paramount Shift to Omni Channel

Traditional banks have historically thought in silos, prioritizing money management and accuracy in their transactions. But their customers, who need them for these services, do not.A balanced omnichannel strategy addresses this shift in the banking customer experience journey. And, with digital channels being the top banking priority of 2017, we can predict that the shift will continue. Customers and financial institutions alike are excited about the convenience of mobile financial services, and the unbanked and underbanked are dominantly owners of smartphones. Financial institutions are realizing that they must deliver on their data and relationship advantages through end-to-end digital services. Mobile banking is becoming -- and, in a very real way, has already become -- the central driver of a completely customer-centered experience in the world of modern banking.

Centric Digital