state of retail banking report
TRANSCRIPT
The State of Banking
2015
www.timetrade.com
Copyright © 2015 by TimeTrade Systems, Inc. State of Banking 2015 is licensed under the Creative Commons Attribution-ShareAlike 4.0 International License. To view a copy of this license, visit http://creativecommons.org/licenses/by-sa/4.0/
ISBN 978-0-692-50980-7
Author:
Sarah Wallace
Sarah currently works as the Content Marketing Manager for TimeTrade. Wallace previously served as an Analyst for the telecom industry covering topics such as Next Gen Customer Experience, Big Data Analytics, Omni-channel, Social CRM and OSS/BSS.
Contributor:
Brent Torre
Brent leads TimeTrade’s channel and technology partnership efforts. Prior to joining TimeTrade, Brent has held positions in Product Management, Operations, and Professional Services at nCircle (acquired by Tripwire), NICE Systems, and Emptoris (acquired by IBM).
linkedin.com/in/sarahwallaceanalyst
linkedin.com/in/brenttorre@brenttorre
@sarah_wallace
TABLE OF CONTENTS
1. Executive Summary
2. Introduction and Key Findings
2.1 Key Findings
2.2 Report Scope and Structure
3. Consumer Experience
3.1 Personalization is Key
3.2 The In-Branch Experience
3.3 Floating Specialists and Universal Bankers
3.4 Services and Fin Tech
3.5 Branch Transformation: Future Branch
4. Omni-Channel
5. Analytics
6. Security Concerns
7. Demographics
8. Conclusion
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1. Banking Consumers: How do you prefer to bank?
2. Banking Consumers: Do you have a banking relationship with a member of the staff of your
local branch?
3. How would you rate your organization’s ability to deliver a personalized customer experience?
4. � �+H�[QW�CTG�KP�C�TQNG�YJGTG�[QW�CTG�TGURQPUKDNG�HQT�DWUKPGUU�DCPMKPI��RNGCUG�TCPM�YJCV�[QW�ƒPF�
lacking with your bank’s business services?
5. Banking Consumers: What are the reasons you come into the branch?
6. Banking Consumers: Please rank what’s important when you visit your branch?
7. Banking Consumers: How many times per year do you visit your branch per year?
FIGURES
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10
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8. Banking Consumers: Would you be willing to bank on a weekday if you were offered a guaranteed
time during the week?
9. Bank Executives: In terms of improving your in-branch customer experience, what options are
you considering?
10. Bank Executives: What barriers are preventing you from making these improvements?
11. Bank Executives: Please rank the following in-branch customer experience goals in order of importance
12. Bank Executives: Does your organization employ any specialists (e.g. Financial Advisors) who operate
out of multiple branches?
13. How do you manage the schedules for your specialist bankers?
14. Bank Executives: Does your bank utilize universal bankers?
15. Bank Executives: Does your bank currently offer, or plan to offer the following services?
16. Bank Executives: Indicate which of the following technologies you are planning/considering in the next
18 months
17. Bank Executives: Please indicate any branch transformation initiatives you are considering
18. Bank Executives: How does your organization view the trend of offering an in-branch cafe style
experience (with coffee, free Wi-Fi and other amenities)?
19. Bank Executives: If you do plan on implementing a cafe style branch, what is the timeline for redesign?
20. Customers expect consistent and contextual interactions across channels
21. Bank Executives: How would you rate your organization’s omni-channel customer experience?
22. Bank Executives: Which channels need to be improved?
23. Where Are High Value Interactions Happening?
24. Banking Consumers: What are the reasons you abandon online banking forms such as
loan applications?
25. Income By Demographic Group
26. What’s important when you visit your branch? Gen X
27. Do you have a banking relationship with a member of the staff of your local branch? Gen X
28. How do you prefer to bank? (Check all that apply) Baby Boomers
29. How many times per year do you visit your branch per year? Baby Boomers
Figures (cont.)
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In today’s digital society, consumers are used to service anytime, anywhere. The personal experience between EQPUWOGTU�CPF�VJGKT�ƒPCPEKCN� KPUVKVWVKQPU�JCU�DGGP�NQUV��Banks are realizing that they must provide a superior customer experience in order to survive and must revitalize the personal relationship in order to do so.
TimeTrade recently conducted a survey of 1,052 consumers, asking in-depth questions regarding their perceptions and behaviors around customer experience and banking. The survey reveals that the majority of consumers still visit bank branches a minimum of ƒXG� VKOGU� C� [GCT�� CV� NGCUV� QPEG� RGT� SWCTVGT�� (KPCPEKCN�institutions that are smart will use these visits to provide a highly personalized experience with the right banking specialist in a timely manner.
The survey also reveals that when consumers are not going into branches, they are banking online or on their mobile devices. Leading banks are fully aware that the times when a consumer is researching online or conducting a mobile transaction are the ideal opportunities to personally engage with the customer, cross-sell, or convert this digital touchpoint into a highly personalized in-branch meeting.
TimeTrade also surveyed 100 senior-level bank executives and asked them about their plans regarding customer experience, products and services, and branch transformation. The survey reveals a trend that bank executives look mostly to training associates to advocate
on the customers’ behalf, in terms of improving the in-branch customer experience. In addition, the majority of DCPM�GZGEWVKXGU�CFOKV�VJCV�VJGKT�ƒPCPEKCN�KPUVKVWVKQPU�CTG�lacking when it comes to providing a true omni-channel experience, citing social media, the web, and call centers as the channels that need the most help. However, at the same time that bank executives look to improve their digital channels, consumers admit that one of the main reasons they do not complete online forms is security concerns.
The TimeTrade surveys also reveal that banking habits vary among different demographics. For example, 10% more Millennials report that they need assistance when making a buying decision than consumers in other age groups. This means that many Millennials need help with choosing a mortgage or starting a retirement fund. Financial institutions need to take such statistics into consideration when serving what is soon to be the largest demographic in the U.S.
This report examines highlights from the TimeTrade surveys as well as research from other sources, and industry outlook and opinions from industry experts on the state of banking and customer experience.
Executive Summary1
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2 Introduction and Key Findings
Today’s consumers have set the bar very high for customer GZRGTKGPEG�� CPF� ƒPCPEKCN� KPUVKVWVKQPU� MPQY� VJG[� OWUV�accommodate these expectations with superior service, or they will risk churn.
Despite the growing popularity of digital services, such as mobile payments and mobile deposits, the majority of banking consumers still report going into the branch a minimum of nine times a year. This indicates that consumers still have a physical need to go into the branch, YJGVJGT�KV�KU�HQT�RGTUQPCN�ENCTKƒECVKQP�QT�DGECWUG�VJG[�FQ�not trust certain processes over digital channels.
The main point is that consumers’ physical presence provides opportunities for highly personalized meetings. *CPFNGF�VJG�TKIJV�YC[��ƒPCPEKCN�KPUVKVWVKQPU�ECP�WUG�VJGUG�visits as opportunities to provide more personal service, enhance customer experience, and drive business through cross-selling.
This changes the dynamic of the in-branch experience, as
ƒPCPEKCN� KPUVKVWVKQPU�OWUV�MGGR� KP�OKPF�VJCV�EQPUWOGTU�are now much more educated and want knowledgeable help in a timely manner. Senior bank executives, branch managers and branch associates must be prepared for this new type of customer while understanding that different demographics will have different banking habits and needs.
Companies have been using analytic tools to gather information online through digital and social channels as well as call center data in order to get to know their customers and build closer relationships with them. *QYGXGT�� ƒPCPEKCN� KPUVKVWVKQPU� VQFC[� OWUV� TGCNK\G� VJCV�a highly personalized customer experience across all channels is what leads to a lasting impression and creates brand loyalty.
Banks are realizing more and more that the key to superior customer service is personalization. This means knowing customers and being able to anticipate their wants and needs, and in the case of banking, being able to know VJGKT� ƒPCPEKCN� UKVWCVKQP� CPF� RTQXKFG� VJGO�YKVJ� VJG� TKIJV�products, services and knowledgeable employees.
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2.1 Key Findings
• Consumers still look to go into the branch: 47% of respondents to the TimeTrade consumer survey report they prefer to do their banking in the branch.
• Consumers do not have a personal connection to their banks: More than half of consumer survey respondents (60%) report they do not have a banking relationship with a member of the staff at their local branch.
• Bank executives admit they need to improve personalization: 52% of senior-level bank executives admit they need to provide a more personalized service.
• Banks are failing to meet the needs of business customers: When asked to rank where banks fail most in terms of service, business customers rank “I feel the bank does not know me very well as a business customer” as number one, followed by “poor omni-channel experience” and “lack of modern services such as video.”
• Banks still have opportunities to provide a highly personalized in-branch experience: 74% of consumers UVKNN�XKUKV�VJGKT�DTCPEJ�CV�NGCUV�ƒXG�VKOGU�C�[GCT�
• Banks have plenty of opportunities for cross-selling/up-selling: 61% of consumers report that the reason they go into the branch is to open an account.
• Banking consumers are highly motivated to go into the branch if a designated time is set aside for them: When banking consumers were asked “Would you be willing to bank on a weekday if you were offered a guaranteed time during the week?” an overwhelming 83% of banking consumers respond “Yes.”
• Millennials like individual attention in banking: When asked “Would you be willing to bank on a weekday if you were offered a guaranteed time during the week?” 86% of Millennials report “Yes,” while 80% of members of other age groups respond the same.
• Bank executives are aware that enhancing the in-branch customer experience is key: 64% of bank executives report that training associates to be customer advocates is a top priority.
• More than half of bank executives report they FXUUHQWO\�XVH�̩RDWLQJ�VSHFLDOLVWV�LQ�PXOWLSOH�branches: When banking executives were asked, “Does your organization employ any specialists G�I��ƒPCPEKCN�CFXKUQTU��YJQ�QRGTCVG�QWV�QH�OWNVKRNG�branches?” 58% respond “Yes.”
• Nearly half of bank executives report using universal bankers (or cross-trained employees): 47% of banking executives surveyed answer “Yes” when asked if their bank employs universal bankers.
• Bank executives look to mobile payments and mobile deposits as new services and technologies: Bank executives describe mobile payments and mobile deposits as the top services and technologies they plan to offer.
• Branch redesign and cross-selling platforms are high priority: Branch redesign and cross-selling platforms are the branch transformations bank executives list as most important.
• Banking consumers abandon online forms due to security concerns: “What are the reasons you abandon online banking forms such as loan applications?” 45% of consumers rank security concerns as the top reason.
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State of Banking 2015 is structured as follows:
3
4
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2.2 Report Scope and Structure
Section III reviews consumers’ overall perception of
customer experience in banking as well as banking
executives’ plans with customer experience
Section VI discusses security concerns by banking
consumers and what technologies banks are using
to prevent security breaches
Section V FKUEWUUGU�CPCN[VKEU�CPF�JQY�ƒPCPEKCN�
institutions can use them to have a 360-degree view
of the customer’s end-to-end journey
Section VI discusses security concerns by
banking consumers
Section VII discusses how various demographics
have different banking habits and how banks can
accommodate these different age groups
Section VIII Conclusion
Consumer Experience
3.1 Personalization is key
In today’s connected society, the bar is set very high for customer experience, and the banking industry is no exception. The key to delivering a superior customer experience is to provide a more personalized service, as consumers are demanding that companies get to know them so that they may receive more tailored offerings and products. Leading ƒPCPEKCN� KPUVKVWVKQPU� TGCNK\G� VJCV�providing a personal experience leads to a high-value banking experience that helps to acquire and retain customers.
TimeTrade recently conducted an in-depth survey that asked 1,052 consumers about their perceptions of and habits related to customer experience in banking. The results reveal that consumers are still going into the branch, with nearly half (47%) of respondents reporting they still prefer to bank “in person at the branch” (Figure 1). However, when asked “Do you have a banking relationship with a member of the staff of your local branch?” 60% of banking consumers answer “No” (Figure 2).
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Figure 1. Banking Consumers: How do you prefer to bank? (Choose all
that apply)
Online Banking
64%
47%
8
Figure 2. Banking Consumers: Do you have a banking
relationship with a member of the staff of your local branch?
60%
40%
No
Yes
47%
41%
17%
In person at the branch
ATM On my mobile (mobile banking application)
Phone
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Simply put, more than half of consumers have no personal connection with their bank. In a competitive landscape where banks are trying to stand out by offering a more personalized customer experience, this lack of personal relationship is an obvious pain point that prevents banks from gaining consumers’ trust and brand loyalty.
6JGTGHQTG��ƒPCPEKCN�KPUVKVWVKQPU�PGGF�VQ�TGVJKPM�VJGKT�approach toward customer service as personalization needs to happen across all touchpoints on all channels, and new technologies and applications that enable this must be taken seriously.
Victor Liu and Robert Schiff of Medallia, a Sequoia Capital-backed customer experience management company, recently wrote an article for American Banker.com titled “How a Great Customer Experience Is Really Delivered1.” In the article, the authors identify four practices that they feel enable “rapid, continuous improvement in customer experience.” They call these practices “operational customer experience management,” and the four management practices they list are:
• Banks need to truly understand how their customers see them.
• Customers’ voices should be wired into every decision, whether it is adjustments to frontline coaching or development of a better mobile app.
• Employees should be accountable for delivering great customer experiences, and that service should be measured by customer feedback and other data.
• Banks must continue to innovate as they get larger, leveraging their size along with customer feedback to experiment more and determine what works faster and better.
However, in the article, Liu and Schiff admit that “It’s easier said than done, because customer data is often siloed and not always accessible across teams.”
Bank executives themselves admit that they need help with personalization. TimeTrade recently conducted a survey asking 100 senior-level bank executives about their current practices and plans regarding customer experience, products and services, and any branch transformation. When asked, “How would you rate your organization’s ability to deliver a personalized customer experience?” 52% admit it needs improvement, is only average or needs great improvement (Figure 3).
1“How a Great Customer Experience Is Really Delivered,” Victor Liu and Robert Schiff, American Banker.com, June 25, 2015.
Consumer Experience (cont.)
47%43%
8%
1%
Excellent
Needs some improvement
Average
Needs great improvement
Terrible
Figure 3. Banking Executives: How would you rate
your organization’s ability to deliver a personalized
customer experience?
0%
10
“The personal relationship is key and at the forefront of any FI strategy. Yet, when a consumer comes in to conduct business in a branch, they are often guided to get in line (think queue ropes) and will simply get whomever is next available to serve them. Strategy doesn’t align to execution in this case. If a client has built a relationship with someone, they should get to choose and be able to bank with that person. It makes logical sense, but most historic designs don’t allow for this, nor did historic technology enable this result. Today, there are key design strategies that engineer the experience, with key technology (like Cash Recyclers and/or appointment solutions) providing the foundation to make it possible.”
In addition, when those who are responsible for business DCPMKPI�YGTG�CUMGF�VQ�TCPM�YJCV�VJG[�ƒPF�NCEMKPI�KP�VJGKT�bank’s business services, respondents rank, “I feel the bank does not know me very well as a business customer” as the top concern (Figure 4). Therefore, even commercial customers note the lack of personalized service.
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3
4
Figure 4. If you are in a role where you are
responsible for business banking, please rank what
\RX�ÀQG�ODFNLQJ�ZLWK�\RXU�EDQN·V�EXVLQHVV�VHUYLFHV"
I feel the bank does not know me very well as a business customer
Poor omni-channel experience [access over web, mobile, etc]
Lack of modern services such as video, etc.
Understaffed in terms of specialists
- John W. Smith, CEO, DBSI, Inc
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3.2 The In-Branch Experience
In February of this year, the FDIC came out with a study2
stating that although the overall number of branches has fallen 4.8% since peaking in 2009, the per-capita number QH�QHƒEGU�UVKNN�TGOCKPU�JKIJGT�VJCP�VJCV�QH�CP[�VKOG�DGHQTG�1977. The study also reports that in 2014, there were 2.9 bank branches per 10,000 people, higher than the 2.2 ƒIWTG�TGEQTFGF�KP������
“New technologies have certainly created convenient new ways for bank customers to conduct business, yet there is little evidence that these new channels have done much to replace traditional brick-and-mortar QHƒEGU� YJGTG� DCPMKPI� TGNCVKQPUJKRU� CTG� DWKNV�Ŭ� TGRQTV�
Eric Breitenstein and John McGee, both analysts in the agency’s research division. “Convenient, online services are here to stay, but as long as personal service and relationships remain important, bankers and their customers will likely continue to do business face-to-face.”
So why are consumers, and even business customers, visiting the branch? When asked, “What are the reasons you come into the branch?” banking consumers rank “Make a deposit/withdrawal” as the number-one reason (71%), followed by “Open an account” (61%), “Mortgage/loan” (22%), “Business to business” (15%) and “Wealth management/Retirement/Insurance” (13%) (Figure 5).
71%
Figure 5. Banking Consumers: What are the reasons you come into the branch? (Choose all that apply)
Make a deposit/withdrawal
Open an account
Mortgage/loan
Business to business
Wealth Management/retirement/insurance
61%
22%
15%
13%
2 “Brick-and-Mortar Banking Remains Prevalent in an Increasingly Virtual World,” FDIC Quarterly, Volume 9, No. 1, 2015.
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The fact that 61% of consumers are coming into the branch to open an account allows for opportunities to cross-sell. Does the customer have any long-term savings RNCPU!�&QGU�JG�QT�UJG�PGGF�VQ�TGƒPCPEG�CP�CWVQ�NQCP�HQT�C�better rate? Does he or she need insurance?
When asked to rank “What’s important when you visit your branch?” banking consumers rank “Location” to be the most important, followed by “Personalized Service,” then “Hours of Operation” (Figure 6). Therefore, “Location” (convenience) narrowly edges out “Personalized service” but not by much. Personalization is still a dominant concern of consumers.
Forty-three percent of banking consumers report they visit their branch more than 10 times a year, while 31% XKUKV� VJGKT�DTCPEJ�ƒXG� VQ�PKPG� VKOGU�C�[GCT�CPF�����XKUKV�VJGKT� DTCPEJ� HGYGT� VJCP� ƒXG� VKOGU� CPPWCNN[� (Figure 7). This means that 74% of consumers still visit their branch CV� NGCUV� ƒXG� VKOGU�C� [GCT�� CNNQYKPI�RQVGPVKCN� HQT� C�JKIJN[�personalized in-person meeting, at least one per quarter.
Figure 7. Banking Consumers: How many times per
year do you visit your branch per year?
Figure 6. Banking Consumers: Please rank what’s
important when you visit your branch?
12
3
Location
Personalized Service
Hours of Operation
More than 10
5-9
Less than 5
43%31%
26%
The In-Branch Experience (cont.)
When banking consumers were asked “Would you be willing to bank on a weekday if you were offered a guaranteed time during the week?” an overwhelming 83% of banking consumers answer, “Yes” (Figure 8). This indicates that banking consumers value their time and are XGT[�CVVTCEVGF�VQ�VJG�PQVKQP�QH�C�URGEKƒE�OGGVKPI�DGKPI�UGV�aside for them.
Additionally, when asked “Would you be willing to come into the bank off-peak if there is an incentive?” 86% of banking consumers answer, “Yes.”
When bank executives were asked what options they are considering to improve their in-branch customer experience, 64% respond “Training our associates to be customer advocates,” followed by “Adding more business banking services” (33%), “Adopting the universal banking UVCHƒPI� OQFGNŬ� ������ ū2TQXKFKPI� XKFGQ� VGNNGT� UGTXKEGUŬ�(24%), “Changing branch design to be more café style” (23%), “Providing more specialists” (21%) and Providing more flexible hours of operation” (9%) (Figure 9).
Training associates to be customer advocates is clearly a top priority for bank executives who are looking to improve their in-branch experiences, meaning they are looking at new approaches to front-line employees’ impact on the customer experience.
The In-Branch Experience (cont.)
64%
Figure 9. Bank Executives: In terms of improving your in-branch customer experience,
what options are you considering?
Training our associates to be customer advocates
Adding more business banking services
#FQRVKPI�VJG�WPKXGTUCN�DCPMGT�UVCHƒPI�OQFGN
Providing video teller services
Changing brand design to be more café style
Providing more specialists
Providing more flexible hours of operations
Other
33%
28%
24%
23%
Figure 8. Banking Consumers: Would you be
willing to bank on a weekday if you were offered
a guaranteed time during the week?
18%
83%
No
Yes
21%
18%
9%
13
14
David Kerstein, founder and President of Peak Performance Consulting Group, comments on this data point and the notion of associates as customer advocates in the branch:
“The answer is not just about training, although that may be part of the solution. Becoming better customer advocates means empowering front line staff to make local decisions on behalf of their customers. And that means simplifying procedures so customer-facing staff can be more effective.
Banks need to re-think the customer experience journey. As touchpoints have grown, so has complexity. The root cause of poor customer experience almost always stems from internal process disconnects, not front line willingness to ‘do what’s right’ for customers.”
When asked “What barriers are preventing you from making these improvements?” 48% of banking executives report “Lack of budget/funding,” 23% respond “Lack of planning,” 11% say “Lack of support from upper management,” 10% report “Lack of vendor support,” 5% identify “Time constraints,” and 3% respond “Lack of SWCNKƒGF�RGTUQPPGNŬ�(Figure 10).
48%
23%
11% 10%
Lack of budget/funding
Lack of planning
Lack of support from upper management
Lack of vendor support
Time
.CEM�QH�SWCNKƒGF�RGTUQPPGN
Figure 10. Bank Executives: What barriers are
preventing you from making these improvements?
5% 3%
The In-Branch Experience (cont.)
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$CPMKPI� GZGEWVKXGU� TCPM� ū+ORTQXKPI� UVCHƒPI� CNNQECVKQP�utilization rates” as their top in-branch customer experience goal, followed by “Reduce customer wait times” and “Reduce associate turnover” (Figure 11). Since UVCHƒPI� CNNQECVKQP� KU� C� VQR� RTKQTKV[� HQT� DCPM� GZGEWVKXGU��this means they want to make sure their branches are QRGTCVKPI�GHƒEKGPVN[�
Figure 11. Bank Executives: Please rank the
following in-branch customer experience goals
in order of importance
Figure 12: Bank Executives: Does your organization
HPSOR\�DQ\�VSHFLDOLVWV��H�J��ÀQDQFLDO�DGYLVRUV��ZKR�
operate out of multiple branches?
3.3 Floating Specialists and Universal Bankers
Financial institutions are constantly striving to put their DGUV� RGQRNG� HQTYCTF�� 5VCHƒPI� C� DTCPEJ� YKVJ� C� JCPFHWN�of well-seasoned specialists can be costly. One way to manage costs is to have banking specialists work/float between multiple branches.
When banking executives were asked, “Does your QTICPK\CVKQP� GORNQ[� CP[� URGEKCNKUVU� G�I�� ƒPCPEKCN�advisors) who operate out of multiple branches?” 58% respond, “Yes” (Figure 12).
+ORTQXG�UVCHƒPI�CNNQECVKQP�WVKNK\CVKQP�TCVGU�
Reduce customer wait times
Reduce associate turnover
Yes
No, and we do not plan to
Not yet, but we plan to in the next year
Not yet, but we plan to in the next 18-24+ months
1
23 58%
31%
9%3%
16
When asked, “How do you manage the schedules for your specialist banker?” more than half of bank executives (58%) TGRQTV� WUKPI� 1WVNQQM�'ZEJCPIG�1HƒEG� ����� CPF� PGCTN[�a quarter of bank executives (23%) report using Offline process/pen & paper (Figure 13). As banks aim to make VJGKT�DTCPEJGU�OQTG�GHƒEKGPV��VJG[�OC[�ƒPF�VJCV�OCPWCN�processes lead to lag time, and a lack of automation will be a major issue.
The universal banker, also referred to as a universal agent, is a cross-trained employee capable of performing both teller and customer service representative tasks. Forty-seven percent of banking executives surveyed answer “Yes” when asked if their banks employ universal bankers (Figure 14).
Figure 13. How do you manage the schedules for your specialist bankers?
2XWORRN���([FKDQJH���2̪FH��� Workforce Management
2̫LQH�3URFHVV���3HQ��3DSHU Other
Floating Specialists and Universal Bankers (cont.)
52%
23%
18%
18%
Figure 14. Bank Executives: Does your bank
utilize universal bankers?
47%
37%
9%7%
Yes Not yet, but we plan to in the next year
No, and we do not plan to Not yet, but we plan to in the next 12-24+ months
173”The Future of Fintech and Banking,” 2015, Julian Skan, James Dickerson, Samad Masood
“The teller lines, where typically only simple transactions are processed are slowly disappearing, as the Universal Banker approach is an initiative getting strong consideration. By eliminating the usual passing of a FXVWRPHU�EHWZHHQ�VWDII�PHPEHUV�WR�IXOÀOO�GLIIHUHQW�VHUYLFH�needs, the customer experience is enhanced due to one- stop service and lower costs can result. The universal banker concept is evolving even further with software that allows cash-based transactions to be processed anywhere in the branch (solutions like RTA for Remote Transaction Access) — securely, effectively — truly allowing for an open plan environment and differentiated level of service.”
- John W. Smith, CEO, DBSI, Inc
$CPM�GZGEWVKXGU�VJCV�YQTM�HQT�ƒPCPEKCN�KPUVKVWVKQPU�YKVJ�assets of $50 billion and above are more likely to answer “No.” This is likely due to the larger staff at bigger banks.
As Smith points out, technologies that enable transactions to be processed anywhere as well as technology that allows in-branch staff to collaborate with one another will lead to an enhanced in-branch experience and allow for more opportunities to cross-sell and ultimately increase business.
3.4 Services and FinTech
According to a recent report3 released by Accenture, global KPXGUVOGPVU� KP� (KP6GEJ� ƒPCPEKCN� VGEJPQNQI[�� VTKRNGF� VQ�US $12.21 billion in 2014. The driver behind this increased interest is that banks want the capability to offer new services to their customers.
Bank executives report that their bank currently offers or plans to offer the following services in the next two years: mobile payments (91%), person-to-person payments (81%), merchant services (78%), securities (64%), health savings accounts (63%), insurance (63%) and real estate services (59%) (Figure 15).
As mobile payments seem to stand out in terms of what bank executives plan to offer in the next two years, Doug Brown, Senior Vice President of eBanking at FIS Global notes:
Figure 15. Bank Executives: Does your bank currently offer, or plan to offer the following services?
“As consumers spend more time RQ�WKHLU�PRELOH�GHYLFHV��ÀQDQFLDO�institutions must engage wisely with customers on this channel. This means not only providing account information, but enabling capabilities such as mobile banking and payments, real-time money movement and mobile commerce. This will allow for an enhanced customer experience and enable customers to live the digital lifestyle they have become accustomed to.”
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Mobile Payments (Apple Pay/Google Wallet)
Real Estate Services
Merchant Services
Person-to-person Payments
Health Savings Accounts
Securities
Insurance
Plan to offer next year Plan to offer in the next two years No plan to offerOffer now
37% 25% 29% 9%
53% 5% 41%
66% 7% 5% 22%
49% 18% 14% 19%
48% 4% 11% 37%
57% 7% 35%
47% 7% 9% 37%
19
Banking executives surveyed were asked to “Indicate which of the following technologies you are planning/considering in the next 18 months (Choose all that apply) (Figure 16). Thirty-three percent of banking executives list “Mobile deposits,” followed by “Customer survey” (31%), “Web video conferencing” (20%), “Cardless cash” (12%), “Debit card payments via wearables” (10%) and “Assisted selling” (9%).
In terms of FinTech trends, AmericanBanker.com has a slideshow on its site titled “7 Ways FinTech Is Improving the Customer Experience.”4 One of the seven FinTech technologies listed in the slideshow is “Booking Off-line Appointments Online.” The description states:
“Smartphone users have gotten used to doing things when it’s convenient for them. Now, Regions Financial (RF), Wells Fargo, Needham Bank, and BMO Harris are enabling consumers to go online to make appointments with bankers offline and avoid lobby waits.”
#P�GZCORNG�QH�C�ƒPCPEKCN�KPUVKVWVKQP�WUKPI�VJKU�VGEJPQNQI[�successfully is Logix Federal Credit Union. Logix has recently found success in increasing business volume in its Los Angeles-area branches by using online appointment scheduling.
With the intent to increase business volumes and provide C� DGVVGT� UGTXKEG� GZRGTKGPEG�� .QIKZ� ƒTUV� FGXGNQRGF� CP� KP�house solution for members who wanted to schedule an appointment to open an account, apply for a loan or meet with an investment advisor at one of its branch locations. Members would complete a form online requesting an appointment for a certain day and time. Then the information was manually handed off to the requested branch for scheduling, and a branch employee YQWNF�EQPVCEV� VJG�OGODGT� VQ�EQPƒTO�VJG�CRRQKPVOGPV��However, the in-house solution did not provide information to the member on which staff members were available for an appointment and at which location.
Figure 16. Bank Executives: Indicate which of the following technologies you are
planning/considering in the next 18 months
Mobile Deposits
Customer survey
Web video conferencing
Cardless cash
Debit Card Payments via Wearables
Assisted selling
20%
Services and Fin Tech (cont.)
31%
33%
12%
10%
9%
4“7 Ways FinTech Is Improving Customer Experience,” AmericanBanker.com,
KWWS���ZZZ�DPHULFDQEDQNHU�FRP�JDOOHU\���ZD\V�ͧQWHFK�LV�LPSURYLQJ�WKH�FXVWRPHU�H[SHULHQFHV�����������KWPO
Logix Case Study
Logix found that it was not getting back to members VQ� EQPƒTO� VJGKT� CRRQKPVOGPVU� WPVKN� ��� JQWTU� CHVGT� VJG�appointments were requested, and in many cases, it was not able to accommodate a member’s request for C�URGEKƒE�FCVG�CPF�VKOG�DGECWUG�KV�YCU�PQV�CXCKNCDNG��+P�those cases, members had to schedule an appointment for another day.
The credit union recently implemented online appointment scheduling, which gives members a self-service option to schedule an in-branch appointment to meet with a banking specialist. Now Logix reports that it is currently experiencing 5,600+ appointments per month in its 15 branches, and the number continues to grow. The result is increased business volume, especially with new accounts CPF� NQCPU�� CU� YGNN� CU� OQTG� GHƒEKGPV� UVCHH� QRGTCVKQPU��It is technologies such as this that will enable banks to establish a more personal relationship with their customers while laying a foundation of trust and ultimately creating brand loyalty.
20
“Appointment scheduling has enabled Logix to better meet the needs of our growing member base, provide a higher level of service to them, and produce more new accounts and loans, through our existing cost structure.”
- Michael Twomey,
Senior Vice President Sales & Retail Banking,
Logix Federal Credit Union
Services and Fin Tech (cont.)
21
3.5 Branch Transformation: Future Branch
6JG�VTCFKVKQPCN�DTCPEJ� KU�DGKPI�TGFGƒPGF��0GY�ūHNCIUJKRŬ�branches with a community or neighborhood atmosphere are serving as the prototype to make consumers feel more at home in the branch with the hope that they will spend quality time there.
Many consider Umpqua to be the trailblazer for this type of future branch when it created a “neighborhood store” in 2007. Its “stores” have more of a coffeehouse feel with services such as food and drink, Wi-Fi, and dog treats. Its newest branch in Portland, Oregon, features an in-bank library.
The results of the bank executive survey reveal that branch redesign/modernization is the top branch transformation initiative that bank executives are considering (46%), followed by cross-selling platforms (45%), expanded business services for commercial banking (28%), customer experience solutions (27%), appointment scheduling (27%), kiosks (27%), and free Wi-Fi for customers (27%) (Figure 17).
When bank executives were asked, “How does your organization view the trend of offering an in-branch café-style experience?” 39% respond “We will wait to see if this model is successful for others,” and 27% report, “We have already implemented this model” (Figure 18).
Figure 17. Bank Executives: Please indicate any branch transformation initiatives you are considering
46%Branch redesign/modernization
Cross selling platforms
Expanded business services for commercial
Customer experience solutions
Appointment Scheduling
Kiosks
Free WiFi for customers
Digital signage
In-branch analytics
Expansion of ATMs
Queue management
Cardless Cash
45%
28%
27%
27%
27%
27%
20%
19%
18%
7%
5%
Of those bank executives who answer that “yes,” they plan on implementing a café-style branch, 67% of respon-dents report that they plan for a branch re-design in the next six to twelve months, and 33% report that they are still in the planning stage (Figure 19).
Capital One also has its 360 Cafés. Not only do these cafés come with a coffeehouse feel, but its employees
22
are called “digital lifestyle coaches.” The purpose of these coaches is to help customers use technology to their advantage and “simplify the ever-changing digital landscape.” The 360 Cafés are located in New York, Boston, Philadelphia, Chicago, Los Angeles, San Francisco, and St. Cloud, Minnesota.
Figure 18. Bank Executives: How does your
organization view the trend of offering an
in-branch cafe style experience (with coffee,
free Wi-Fi and other amenities)?
We will wait to see if this model is successful for others
We have already implemented this model
We will not implement this model
We plan to implement this model
Figure 19. Bank Executives: If you do plan on
implementing a café-style branch, what is the
timeline for redesign?
Branch Transformation: Future Branch (cont.)
In the next 6-12 months
In the next 18 months
In the next two years
We are still in the planning stage
39%
27%27%
8%
39%
0%0%
33%
23
“There is much talk to the ‘branch of the future,’ but much of this meaning is truly singular. Yet, no other industry talks this ZD\��+RWHOV��465V��UHWDLOHUV��HWF��ZLOO�ÀQG�FRQVLVWHQW�WKUHDGV�RI�customer experience improvements and ensure these are layered-in appropriately across their entire channel. Now, of course, all improvements can be strategized to be delivered in the next new location, that’s absolutely spot on. But, the art and science is how to WDNH�WKH�NH\�HOHPHQWV��FUHDWH�D�UHÀQHG�6PDUW�.LW��DQG�LQFRUSRUDWH�them effectively and consistently across not only the branch channel but to also drive mobile, migration to self-service, etc. Lastly, there typically is one key element in delivering the above, that doesn’t typically happen well and limits the results. That is in how the YDOXH�LV�DFWXDOO\�GHÀQHG�����
'HÀQLQJ�WKH�YDOXH�LV�WKH�H[HFXWLRQ�RI�QRW�MXVW�WKH�QHZ�WHFKQRORJ\��but the intended customer experience, the choreographed consumer ÁRZ��DQG�KRZ�WKH�VWDII�ZLOO�RSHUDWLRQDOL]H�WKH�DUWLFXODWLRQ�RI�WKH�),·V�YDOXH��WUDLQ�WR�WKH�EHQHÀWV��DQG�WUDQVLWLRQ�HIIHFWLYHO\�
7KLV�GHOLYHU\�FDQ�EH�GHÀQHG�DQG�SDFNDJHG�LQ�WKH�ULJKW�SOD\ERRN��When done correctly, the results get fully obtained!”
Branch Transformation: Future Branch (cont.)
In terms of the future branch, Smith notes:
David Kerstein comments on café-style branches:
“Just like other successful UHWDLOHUV��EDQNV�QHHG�WR�ÀQG�ways to connect with customers. The idea of serving coffee or offering free Wi-Fi – making the bank branch experience more friendly — is not new. Umpqua Bank and Amplify Credit Union, among others, use their branches for community events to encourage prospects and customers to engage with branch staff. Capital One’s experiment is worth watching. They are taking lessons from their acquisition of ING Direct and entering new markets like Boston with a small number of consumer
24
friendly café-style branches. Will it be successful? If they can convince customers that they are adequately convenient with only D�IHZ�KLJK�SURÀOH�ORFDWLRQV��WKHQ�it could be a game-changer for the industry.
What does this trend mean? Banks need to re-engage customers and improve relevancy of bank branches. If customers are visiting branches less frequently, and if they are now more likely to visit for advice and support rather than transactions, then the industry needs to re-think the in-branch experience.”
4 Omni-channel
The interaction of today’s banking consumer is complex, convoluted and non-linear, traversing multiple touchpoints. To adequately interpret customer preference and provide a holistic customer experience, banks must consistently provide superior service through contextual interactions across all channels. These channels include the web, email, social portals, voice, mobile and text, call centers and the branch (Figure 20).
25
Figure 20. Customers expect consistent and contextual interactions across channels
Unfortunately, today, most banks’ channels operate in silos both organizationally and from a systems standpoint. Therefore, they fail to provide a consistent experience, up-to-date information CPF� C� WPKƒGF� NQQM� CPF� HGGN�� YJKEJ� FKUCRRQKPVU� EWUVQOGTU�� 6JKU� KU� GURGEKCNN[� VJG� ECUG� YJGP�customers have to “start over” when going from channel to channel with a customer service issue, for example.
25
SOCIAL MEDIA
CALL CENTER
VOICEINTERNET
PRINT MOBILE & TEXT
Omni-channel (cont.)
Figure 21. Bank Executives: How would you rate your
organization’s omni-channel customer experience?When bank executives were asked how they would rate their organizations’ omni-channel customer experience, an overwhelming 81% indicate that it needs a certain level of improvement. (Figure 21).
The channel bank executives perceive as needing the most improvement is social (48%), followed by web (42%), mobile banking (40%), call center (39%), online banking (37%) and in-branch and chat (both at 34%) (Figure 22).
26
Figure 22. Bank Executives: Which channels need to be improved? (Choose all that apply)
48%Social channels
Website
Mobile banking
Call center
Online banking
In-branch
Chat
Text (SMS)
Voice/IVR
ATM
All of the above
42%
40%
39%
37%
34%
34%
28%
22%
16%
5%
Excellent Average Needs some improvement
Needs great improvement
Terrible
26
19%
52%
17%11%
1%
Banks acknowledge that they need to understand their customers’ individual experiences on a continuous basis as they interact with their customers both on- and off-line. This will put banks in the best position to manage all the touchpoints that can affect the customer experience.
Consumers today have never had more channel options. They continue to expect more seamless interactions that build brand experiences and boost loyalty and retention. Therefore, it becomes a necessity for banks to offer a robust cross-channel experience that delivers against customer expectations. Every touchpoint must enrich the customer’s experience, and every interaction must be viewed as pivotal in the customer’s purchasing decision.
The following are some examples of how banks can provide high-value interactions at various touchpoints with specialized associates (Figure 23).
Omni-channel (cont.)
#U�DCPMU�VT[�VQ�DWKNF�CP�GOQVKQPCNN[�YGKIJVGF�TGNCVKQPUJKR�YKVJ�GCEJ�EWUVQOGT��VJG[�YKNN�ƒPF�VJCV�providing a superior experience is an effective way to drive a more personal relationship with EWUVQOGTU�CU�YGNN�CU�C�OGCPU�QH�ICVJGTKPI�OQTG�KPHQTOCVKQP�HQT�C�EWUVQOGT�RTQƒNG��YJKEJ�CNNQYU�for more personalized offers and consistent service across all channels in the future.
27
Figure 23. Where Are High Value Interactions Happening?
ANYWHERE Scheduled and on-demand
tele-presence enables specialized associates to have high-quality
customer interactions at the customer's convenience,
wherever they are.
CENTRALIZED Specialized associates available
in premier branches.
ROAMING Specialized associates float across branches with a managed schedule
PAST
FUTURE
Analytics
In terms of gathering more information on the customer, feedback should be used to unearth pain points that require change. The personalization required to deliver a personal banking experience that differentiates and drives more business requires data. However, the data that banks need to personalize the customer experience is typically in disparate systems, only serving the various channels through which they deliver services. As long as this data is siloed, providing a superior and personal DCPMKPI�GZRGTKGPEG�KU�GZVTGOGN[�FKHƒEWNV�
In Jim Marous’ article “Top 10 Retail Banking Trends and Predictions for 2015”5 on TheFinancialBrand.com, his top trend is “Using Customer Analytics to Drive Contextual Experiences.”
Marous writes:
“In 2015, banks and credit unions will leverage richer analytics-driven insights to enable a more personalized approach to targeting and engaging with consumers. From location-based offers to improved service delivery, organizations will use spending patterns, product use, and channel interactions to enable improved experience-driven banking.”
In the article, Marous quotes Jenni Palocsik, Marketing Director of Retail Financial Services at Verint, as saying:
“Increasing customer expectations – as well as consumers’ ongoing ‘disregard’ for the limitations of existing (and outdated) banking silos – will force retail banking organizations to provide employees with contextual data for smarter consumer engagement, and provide management with robust analytics for ongoing decision-making and for mitigating regulatory risk.”
5
28
5Top 10 Retail Banking Trends and Predictions for 2015, Jim Marous,
TheFinancialBrand.com, December 19, 2014.
29
Palocsik answered the following questions for this report:
How do you feel banks should capture contextual data? Will it be through traditional analytic vendors or another type of vendor?
“Banks need to partner with technology vendors
that can help them both capture interaction data
from every touch point with the customer—from
social media, live chat and email, to more
traditional channels like calls into the contact
center or visits to a branch—and analyze that data
to quickly identify interaction drivers, root causes
and emerging trends that can help retail banking
executives make more rapid, informed decisions.
It’s important to identify partners that can deliver
new capabilities as your bank continues to evolve
and transform itself over time. Likewise, it’s critical
to make sure that the right consulting services
and support are in place to help you achieve your
business strategies.”
Q:
A:
Q:
A:
Once employees are given this contextual data, what will be the best way for them to use it? What tools? On their tablets in the branch?
“In today’s environment, employee engagement
and empowerment are critical to help ensure the
best outcomes for both the customer and the bank.
:KHQ�EDQNV�VKDUH�DFFHVV�WR�D�����GHJUHH�YLHZ�RI�a customer’s interactions, their staff can quickly
understand and respond to each request, providing
seamless transactions regardless of the previous
channels used. This insight can help mitigate the
need for the customer to explain everything again.
When this information is augmented with tools like
knowledge management and case management,
banking staff can help quickly and consistently
resolve customer issues, as well as cross-sell
appropriate products and services.”
As the TimeTrade survey reveals, both consumers and business customers express a lack of personalization and admit that they either do not have a relationship with the bank, or that they feel the bank does not know them as a customer. Banks that take advantage of advanced analytics will be able to deep-dive into individual customers’ feedback and needs and be able to take action in real time to prepare for an in-person meeting and provide an enhanced customer experience.
Analytics (cont.)
30
6 Security Concerns
Cybercriminals around the world are trying harder to CESWKTG�EQPƒFGPVKCN�WUGT�FCVC�CPF�KPƒNVTCVG�DCPM�CEEQWPVU�D[�ETGCVKPI� HCMG�UKVGU�CPF�YGD�RCIGU� KOKVCVKPI�ƒPCPEKCN�QTICPK\CVKQPU�QT�QVJGT�ƒPCPEKCN�+PVGTPGV�TGUQWTEGU��6JGUG�type of phishing attacks have become very popular because they are simple for hackers to deploy and extremely effective. Unfortunately, the focus on bank web services is currently one of the strongest phishing trends.
An international cybercrime gang has been known to deploy malware via phishing scams to get inside of computers at more than 100 banks and steal upwards of US$300 million — possibly as high as US $1 billion.
Brian Krebs of the Krebs On Security blog points out that “this gang specializes in hacking into banks directly, and then working out ingenious ways to funnel cash directly HTQO�VJG�ƒPCPEKCN�KPUVKVWVKQP�KVUGNH�Ŭ6
+P� VJG�7�5���JKIJ�RTQƒNG�UGEWTKV[�DTGCEJGU�YKVJ�5QP[�CPF�Target have made consumers more wary of performing transactions that involve highly personal information.
When asked “What are the reasons you abandon online banking forms such as loan applications?” 45% of banking consumers rank security concerns as the top reason, HQNNQYGF� D[� ū+� ƒPF� +� YCPV� GZRGTVKUG� HTQO� C� NKXG� DCPMKPI�associate” (32%) and “I am not sure if I am choosing the right options” (24%) (Figure 24).
I am not sure if I am choosing the right options
Security concerns
+�ƒPF�+�YCPV�GZRGTVKUG�HTQO�C�NKXG�DCPMKPI�CUUQEKCVG
30%
Figure 24. Banking Consumers: What are the
reasons you abandon online banking forms such
as loan applications?
45%32%
24%
31
Information security consultants warn consumers to be very cautious when sharing information online, saying cyber criminals capitalize on information found on the web when looking for possible victims. Furthermore, security experts unanimously agree that cyber threats are increasingly becoming one of the desired outlets for run of the mill criminals.
Financial institutions must adopt high-end measures to ensure protection in online banking, especially now that most banks are now capitalizing on e-banking services HQT� GHƒEKGPV� QRGTCVKQP� CPF� EWUVQOGT� EQPXGPKGPEG�� $CPM�services such as Internet banking and mobile phone banking, as well as more sophisticated uses of e-money instruments such as cash/remittance cards and electronic wallets, are becoming more common. What’s important to remember is that all these are accessible via mobile phones or tablets, which can possibly make them more vulnerable.
6GEJPQNQIKGU�UWEJ�CU�DKQOGVTKEU� G�I��ƒPIGTRTKPVU�� XQKEG�recognition) will become commonplace in transaction authorization, but they will remain tied to a replaceable physical device (e.g. smartphone). Biometrics are unique and unchanging, yet they can be captured and replicated, UQ� VYQ�HCEVQT� CWVJGPVKECVKQP� G�I�� C� ƒPIGTRTKPV� CPF� C�phone) will always be required.
In the end, both banks and consumers are wary of cyber threats, but experts agree that this is a good thing, as caution may be the factor that helps manage the attacks KP�VJG�ƒTUV�RNCEG�
Security Concerns (cont.)
32
Demographics7 Millennials
&GƒPGF� CU� VJQUG� DQTP� DGVYGGP� ����� CPF� ������ Millennials will soon be the largest age demographic in the U.S. and have the potential to become the highest earning generation to date with 8.3 trillion in aggregate annual income by 2025 (Figure 25). As the transfer of wealth shifts to this generation, banks must keep in mind who their customers will be when planning their products, services and branch transformations.
Figure 25. Income By Demographic Group (Trillions)
Source: GenerationY: Why They’re Worth a Second Look, Harland Clarke, 2013
The following are statistics from the TimeTrade consumer banking survey, which shows how Millennials are different from the other demographics.
• Millennials are 30% more likely to bank on their mobile devices and are 6% less likely to visit a branch versus the other age groups
• Millennials are 8% more likely to visit a bank to open an account or get a mortgage/loan than other age groups
• Millennials are more likely to prefer pre-booked appointments (40%) than other age groups (34%)
• Milllennials are less likely to have an existing relationship with a banking associate. 64% of Millennials respond “no” versus the other age groups (58%).
• When asked “Would you be willing to bank on a weekday if you were offered a guaranteed time during the week?” 86% of Millennials report “Yes” versus 80% of members of other age groups
• Seventy-two percent of Millennials are influenced by a café environment versus 45% of members of other age groups
• Security concerns still dominate online banking concerns, but 10% more Millennials need assistance making a buying decision than members of other age groups
• Millennials are 3% more likely than members of other age groups to choose a bank based on its products and services versus convenience
2010 2015 2020 2025
Baby Boomers
Gen X
Millennials
8.3
6.4
1.1
33
Demographics (cont.)
David Kerstein comments on Millennials:
“Millennials are poised to become the prime bank customers. The leading edge is now in their 30s: they have stable jobs or are starting businesses, are getting married, having children, buying homes. And their banking patterns are not yet fully established. Data shows that they switch banks at over 5 times the rate of Baby Boomers. These are SURÀWDEOH��DFFHVVLEOH�FXVWRPHUV��EXW�WKH\�KDYH�GLIIHUHQW�H[SHFWDWLRQV�about their bank experience.
On-line and mobile are of primary importance to these customers compared to traditional bank clients, who rate convenient branch access as the principal determinant of bank preference. Millennials are digital natives. They grew up with computers and cell phones and Facebook and Twitter. They expect instant access, and they value peer ratings on social media. They expect to research services on-line, and perhaps even open accounts instantly.
%DQNV�QHHG�WR�DGMXVW�WKHLU�VHUYLFH�GHOLYHU\�DQG�SURGXFWV�WR�ÀW�WKHLU�lifestyle. They value services like mobile check capture, mobile bill pay and peer-to-peer transfers. They want on-line money management tools and the ability to open accounts on-line. They value services that make the bank more convenient for them, like on-line or mobile appointment setting.”
33
)GP� :GTU� CTG� FGƒPGF� CU� VJQUG� DQTP� DGVYGGP� ����� CPF�1979. With a population of more than 66 million, Gen X represents 18% of total U.S. spending power.
Gen Xers are known for being very educated, informed and thorough in their research. As this group has grown up witnessing many corporate scandals, companies have to earn their trust. According to the TimeTrade survey, Gen Xers highly prioritize personalized service over location and hours of operation as what is important when they visit a branch (Figure 26) versus the Millennials and Baby Boomers, where there is not much difference between the choices.
Forty-eight percent of Gen Xers report having a banking relationship with a member of the staff at their local branch (Figure 27) versus 36% of Millennials and 37% of Gen X.
Other facts about Millennials and Gen X that banks must take note of are as follows:
0,//(1,$/6��*(1�;HUV
• Value advocacy over advertising
• Demand responsiveness to needs
• Want expert help making tough decisions
• Expect convenience & consistency across channels
• Will not take a phone call, but will read texts
• Prefer mixed-use lifestyle retail experiences
Demographics (cont.)
34
Figure 26. What’s important when you visit your
branch? Gen X
Personalized service
Location Hours of Operation
Figure 27. Do you have a banking relationship with a
member of the staff of your local branch? Gen X
52%
48%
No
Yes
*HQ�;�
1
2 2
35
Baby Boomers are described as those who are born between 1944 and 1964. Baby Boomers are the largest demographic in the U.S. Like the other demographics, Baby Boomers like to research online, but they are more likely than other demographics to use “consumer websites and publications” and much more likely to cite these as “primary” sources.
Sixty-seven percent of Baby Boomers prefer to bank in person at the branch (Figure 28). This is sharply higher than Millennials (45%) and Gen Xers (41%) who respond the same. Banks should take note of the services, such as wealth management, which may be a priority to this demographic.
Forty-eight percent of Baby Boomers visit their branch more than 10 times a year, which is higher than Millennials at 42% and Gen Xers at 44% (Figure 29). This is only logical since Baby Boomers prefer to bank in person at the branch, DWV�VJG�HTGSWGPE[�UQNKFKƒGU�DCPMUŨ�QRRQTVWPKVKGU�VQ�ETGCVG�a highly personal in-branch experience for Boomers.
Financial institutions should take note that all demographics have different banking habits, and banks that can cater to all these age groups in a comprehensive, timely manner will drive more business to their organizations.
Demographics (cont.)
More than 10
5-9
Less than 5
64%
30%
Figure 29. How many times per year do you visit
your branch?
Figure 28. How do you prefer to bank? (Check all that apply) Baby Boomers
On my mobile (mobile banking application)
Online banking
ATM
Phone
In person at the branch
36%
61%
14%
10%
62%
Baby Boomers
48%
24%
28%
Conclusion
36
8
$CPMU�OWUV�MGGR�KP�OKPF�VJCV�HTQO�VJG�FKIKVCN�ƒTUV�VQWEJ�CNN�the way to the in-branch visit, it is all about the customer’s path and how to provide the best service across all these touch points. - Creating a high-value, personalized interaction will lead to a more satisfying experience for the customer and higher lifetime value.
The TimeTrade survey revealed that various demographics have different banking habits. Millennials are looking for products and services that are very focused on the individual, while Baby Boomers and Gen Xers have done more research and want purchase validation from an honest and transparent bank. Though all have different banking habits, what they all have in common is an interest in saving and growing their money.
+P�QTFGT�HQT�ƒPCPEKCN�KPUVKVWVKQPU�VQ�UWTXKXG��VJG[�OWUV�DG�progressive in how they create the in-branch experience using modern-day technology while providing prompt service, all the while knowing customers’ needs before they even enter the branch and providing a consistent customer experience across all channels. Though this UGGOU� NKMG� C� VCNN� QTFGT�� NGCFKPI� ƒPCPEKCN� KPUVKVWVKQPU� CTG�doing all of the above and are aware of their customers’ ever-changing needs. Banks that showcase their technologies and provide superior service across all channels will continue to thrive in the competitive and GXGT�EJCPIKPI�ƒPCPEKCN�UGTXKEGU�OCTMGV�
37
TimeTrade would like to thank those who helped contribute to
the State of Banking 2015 report.
Doug Brown, Senior Vice President of eBanking, FIS Global
'DYLG�.HUVWHLQ�� Founder and President of Peak Performance Consulting Group
Jenni Palocsik, Marketing Director of Retail Financial Services at Verint
Thank You
www.timetrade.com
You may contact or follow TimeTrade on social media via:
John W. Smith, CEO, DBSI, Inc
Michael Twomey, Senior Vice President Sales & Retail Banking, Logix Federal Credit Union