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Omnichannel banking: A consumer-first, not bank-first, experience


February.03.2015 0 Comments

When you hear the word ‘bank’ you might think about the ATM outside your office, your local bank branch, or even visions of old movies with cops and a robber.

The reality is that banking actually extends much further back in time as bank branches were established as early as the 14th century. During this period, they were the only consumer touch-point for banks, with no other channel vying for a customer’s attention. You could say that this banking ecosystem was the total opposite of the omnichannel experience.

Transition from unichannel approach to omnichannel experience

This unichannel approach was challenged with the technological improvements introduced in the 20th century. The first ATM was introduced in 1967. Banks opened their first call centers in the early 1980s, which later evolved into interactive voice response (IVR) systems. Banks began to provide online services in the mid-1990s and mobile services in the early 2000s. With this, banking gradually evolved to have an omnichannel structure.

However, the biggest issue with the banking system in the 2000s was that the customer experience remained immovable and prescriptive. Now it’s time for the customer to expect the experience that’s right for them.

Thanks to a constant stream of technological innovation, everything from TVs to glasses to wristwatches are potential interfaces for banking transactions. As the number of potential channels has grown over time, so has the functionality and complexity of each. Now, consumers expect their banks to provide unified experiences, with the right look, feel and functionality regardless of what channel they use. The big question is how to make these channels deliver a seamless and consistent experience for customers while optimizing the unique assets that each provides.

How to build a successful omnichannel strategy

One of the key components of a winning omnichannel presence is communicating a strong, recognizable brand across every touchpoint. A bank’s brand – the promise it intends to deliver – should be reflected visually as well as experientially in the same way via every channel, whether that’s a branch, ATM or mobile banking app. Imagine that your favorite arcade game releases a mobile version, but when you start playing you realize all the controls and power-ups are different, and even the characters aren’t the same. This difference would inevitably frustrate you, showing how important it is easy to deliver consistency cross-channel.

Bluntly, a consumer doesn’t care about the integration behind the scenes and the different departments and various analytical tools that vary by channel. It is up to the bank to create a unified experience regardless of its internal operations (some will reach the point of having strong omnichannel operations – which is likely far in the future for most). It is not enough just to create a solid strategy for each channel, but is essential to embrace a holistic view of all of them. A holistic approach creates a stronger brand in customers’ minds which is essential both marketing-wise and service-wise.

However, each touchpoint has unique characteristics. This means that banks need to make their services easy for the customer, regardless of the means they use to access them. In an omnichannel approach done right, using a bank’s mobile app should enable the customer to intuitively understand and use Internet banking or the bank’s tablet app.

To establish this, banks need to clearly understand customer expectations, usage habits and streamline their systems. Research from Google has shown that 98 percent of Americans switch between devices in the same day. For the 46 percent of the population managing their finances online, this means switching between devices before completing a financial activity. Banks need to deliver the same feel and structure to make sure that these interrupted transactions are completed as seamlessly as possible on the next device.

Influence of mobile on omnichannel approach

Of all the channels discussed here, mobile is the newest and the fastest-growing – here at Monitise, we now process over four billion mobile money transactions every year. Even if mobile banking started out as an ‘alternative’ channel, its ability to deliver on-the-go transactions and account updates has quickly taken it mainstream.

Now used by almost one billion people, mobile banking will lead the transition to a unified experience between the physical and digital worlds. We are more involved with our mobile devices than any other gadget. The Economist reports that four-fifths of smartphone owners check their devices within fifteen minutes of waking up, and that the typical user does so 150 times a day. Mobile often leads the way in development; flat design was first introduced to mobile and later became prevalent as a general design concept. Similarly, steps towards creating an omnichannel experience can be applied to mobile first and then spread to other channels. As we tend to use our smartphones constantly, we adapt to these new developments quickly and expect mobile experiences to translate to other channels.

While a significant proportion of customers are moving to digital channels, they are not necessarily abandoning traditional ones. This highlights the importance of an omnichannel strategy. Numbers from Gallup show that 79 percent of mobile banking users have also visited a physical branch in the last six months, and 84 percent have gone to the ATM. Given the rise of digital, banks need to renew branches and ATMs to offer connected services.

Focusing on an omnichannel strategy will bring important benefits to banks: enabling them to use their financial and IT resources more efficiently, build comprehensive customer data and form enhanced interactions that continue over different channels. Most importantly, an intelligent omnichannel strategy will be a powerful weapon for banks to forge tighter bonds with consumers in an increasingly competitive landscape. Banks that fail to implement a successful omnichannel strategy risk facing significant customer loss to the banks or disruptive challengers that do so.