Banking and financial institutions are in the midst of a massive evolution with customer experience topping the list of priorities. With the rise of new and intelligent technologies and the growing need to digitize and automate financial services, traditional financial institutions are striving to stay on the cutting edge and ahead of changing regulatory compliances, by transitioning toward an omnichannel approach to banking.
The State of Modern Banking
Times are changing. In the 1990s, it was illegal to even interact with a bank using the internet—today, millennials and Gen Z’ers do their banking exclusively via digital channels.
Modern customers are managing their finances and transacting with financial institutions across a breadth of channels. A typical customer likely interacts with a financial institution via mobile app, online portal, and in-person at a branch, at the very least. As the ubiquity of smart devices and their respective apps and channels increases, customers have a range of options as to where and when they utilize financial services.
Most financial institutions have either implemented or are in the process of implementing a multi-channel presence—allowing customers to transact and manage their finances across a multitude of channels (mobile app, online portal, brick-and-mortar branch, call center, etc.). But, too often, the systems and processes available through each of these channels are siloed—leaving customers to deal with disjointed and redundant interactions as soon as they attempt to cross channels. Financial institutions may even have a digital channel strategy in place, but with disconnected channels in place, the integration to the backend operations department may not exist.
Customers have grown to expect successful transactions across all channels; the point of differentiation lies in a seamless experience. Customers should be able to manage their finances across many channels without having to re-submit documents, re-fill forms, or start over.
While the future of banking is certainly based upon this multi-channel approach, financial institutions must go one step further and shift from a disjointed, bank-centric approach to an integrated, customer-centric perspective. The key is an omnichannel system that enables banking and financial institutions to anticipate and exceed their customers’ needs, expectations, and desires.
What is Omnichannel?
An omnichannel approach levels up multi-channel by offering a consistent and seamless experience across all the touchpoints in a customer’s journey, and further, relies on data and insights to inform intuitive and personalized customer interactions. Omnichannel enables organizations to track the customer journey and retain the context of their interaction from one touchpoint to the next—helping banking and financial organizations to follow-up on abandoned transactions and offer personalized support.
An omnichannel approach also allows banking and financial institutions to future-proof their enterprise and deploy rapid, organization-wide changes to keep up with ever-changing regulatory compliances within the banking industry.
Components of an Effective Omnichannel Experience
Delivering a seamless omnichannel experience requires banking and financial institutions to implement a number of considerations and steps.
1. Consider the customer journey:
Financial institutions must consider every touchpoint along the customer journey and ensure that each interaction a customer has with the organization is seamlessly powered by a running record of the customer’s data, preferences, and patterns. This is most effectively achieved by investing in a unified, configurable platform upon which a financial institution could plausibly conduct all of its business operations.
This omnichannel approach, powered by a robust, unified platform, also allows customers to begin and end their customer journey on and across any combination of channels—including social, online portal, marketing material, and more—all while retaining the context of their interaction and all of their previously entered information.
2. Invest in new-age technology
One of the highlights of omnichannel is the emphasis it places on the customer, to that end, banking and financial institutions should invest in new-age technologies, such as social sensing, artificial intelligence (AI) and machine learning (ML), speech and sentiment analysis, to analyze and gain insights into customer behavior and intent. Utilizing intuitive technology allows financial institutions to bring a human touch into even the most digitized areas of their operations. Furthermore, a focus on customer patterns and intent enables financial institutions to deliver relevant recommendations, cross/up-sell products, and engage customers with personalized marketing and messaging.
3. Supplement legacy systems
The best omnichannel system is one that supplements an organization’s legacy systems and can leverage their historic data for analysis and future decision making. It is a daunting task to completely overhaul a financial institution’s backend system, so implementing a customized omnichannel approach which enhances the legacy system seems like the best option.
4. Capitalize upon customer data and insights
Omnichannel enables banking and financial institutions to collect customer data across all the touchpoints along the customer journey, across all channels. With a robust analytic process in place, organizations are able to mine valuable insights from this data. These insights are key in creating a personal relationship with customers by anticipating their needs and engaging with customers on their terms.
Furthermore, storing customer data and behavioral patterns allow financial institutions to remove many friction points experienced by customers, such as having to fill in the same fields across multiple online and mobile forms.
The Need of the Hour
Migration of branch operations to digital: Moving forward, as omnichannel enters the mainstream within the banking industry, financial institutions should begin digitizing services that have traditionally been regarded as exclusively in-person, in-branch transactions, such as loan and mortgage approval, financial advising, etc.
Additionally, the frequency of virtual interactions for financial advising requires a dramatic increase as financial institutions strive to stay relevant. In fact, 72% of customers, ages 40 and under, are comfortable with the idea of using virtual financial advisors.
Capitalize upon digital sales: Omnichannel is primed to be a huge driver of digital sales. Currently, about 25% of product sales in the banking industry occur via digital channels. However, implementing an omnichannel approach and creating a seamless customer journey, wherein customers are empowered to easily complete transactions through any (or multiple) digital channels, is a surefire way to boost digital sales in the future.
Focus on the evolving customer journey: Over the past decade the importance of the customer, and the customer journey itself, has evolved so much. Moving forward, financial institutions should gear themselves by building their businesses upon a unified, configurable platform and implementing an omnichannel approach. These two components can help them in adapting to the ever-changing customer journey by gathering data and insights, and then building new processes and tools based on their customers’ analyzed needs.
There is no denying that the financial services industry is undergoing some serious shifts in terms of where, when, and how business is conducted. And as the number of channels available to customers increases, the best way financial institutions can be future-ready and cater to their customers’ evolving needs is by implementing an omnichannel solution—truly honing in on the customer journey and capitalizing on all of the touchpoints which comprise the modern banking and financial services industry.
Ritesh Varma
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