May 27, 2015 | Ken Hans
Reaching Financial Service Consumers in the Digital Age
Modern smartphones qualify by definition as personal computers, and about 80% of the world’s total population owns a smartphone. In 2013 alone, over 1 billion smartphones were sold to consumers. These smartphones are quickly replacing an array of other once-common devices, including home phones, cameras, maps and GPS systems. This is resulting in an increased need for financial innovation as consumer expectations shift. People expect and demand more and more of their banking services to be offered through the mobile channel.
Changing Trends in Consumer Interaction
Many brick and mortar bank branches are seeing a slowdown in face-to-face transactions. Why? According to Brian Moynihan, CEO of Bank of America, “People effectively carry a branch in their pocket.” In other words, mobile banking is easier and more accessible for customers who have a smartphone. The benefits to banks from this trend are varied, and include:
- Lower processing costs for check deposits (an average of $0.10 for digital-mobile against $4.25 for bank-teller assisted deposits)
- Lower costs of service overall
- Higher customer satisfaction rates due to the ease of performing transactions digitally
Given the benefits for financial institutions and customers, it’s no wonder that “bricks and mortar” is being replaced by “clicks and Twitter.”
Customer Engagement with Mobile Banking
We are indeed in a digital age, with a survey conducted by The Financial Brand finding that 53% of respondents used their mobile banking app at least weekly. Eighty eight percent (88%) of these customers also logged into their bank’s online banking portal at least weekly. For financial institutions, these statistics create a clear goal: meet the needs of customers on each digital banking channel while providing a consistent user experience.
Dynamic, fresh and live-feed information can help customers access up-to-date information, while on the banking side, messaging and customer touch-points can be introduced in and around digital app functionality. The key is to celebrate the app functionality, highlighting what the benefits are to the customer while soliciting ongoing feedback through channels such as app store reviews and social media as part of “Social Care” in the overall customer care experience. Real-time digital customer interaction, including relationship-focused account alerts, help reach and engage customers to drive customer satisfaction with the mobile banking experience.
Strategies to Successfully Reach Digital Financial Services Customers
Now that most financial institutions have “Digital 1.0” presence, we are seeing an uptick in banks looking to define their “Digital 2.0” strategy. Digital 2.0 is more personalized and user-interactive than its predecessor, and it’s critical for institutions to create “stickiness” and brand loyalty while leaving flexibility for platform updates and future monetization opportunities. The first step to achieving this goal is creating consistency through mobile and online banking convergence, using one platform for ad displays and activity and response reporting. This allows financial institutions to:
- Take advantage of faster deployment times for added products and services
- Consolidate customer finance tools under “one site” – increasing personalized cross-sell marketing campaign opportunities
- Design functionality around the tools customers already have and use, including tablets, device cameras, and geolocation reporting for improved security
- Look ahead to coming trends in mobile banking, such as voice-enabled transactions
Digital 2.0 has the added benefit of improved and real-time data tracking. This allows not only faster problem reporting, but also enhances the ability to pinpoint conversions from targeted marketing, identify cross-sell marketing touch points that are performing well, and adjust digital messaging for better targeting. For, as it has been said about the digital revolution, “Data is the new oil in the digital economy.”
The digital age of mobile banking has arrived, and it is here to stay. To remain competitive, financial institutions must understand shifting customer demographics in, and expectations for, their digital channels. Emerging platforms that combine digital banking utilities under one platform provide improved customer experiences and bottom-line benefits for the institutions that adopt them. This presents banks with an opportunity to show their dedication to serving customers while strengthening their marketing and service capabilities.