Customers embrace banking by appointment

When the pandemic restricted access to branch lobbies, customers took to the idea of making appointments when doing their banking.

Matt Hertel from UKG joins us to talk about the current state of appointment-setting and where he sees it going in the years ahead.

A few takeaways from our conversation:

  • New checking accounts and consumer loans were the leading categories for appointments, opening cross-selling opportunities.
  • Virtual meetings are at the leading edge in the appointments space, both for the customer and for institutions.
  • With customers doing more digital banking, appointments can provide bankers with opportunities to make strong connections.

Subscribe to the BAI Banking Strategies podcast:

Apple Podcasts     Spotify    Google Podcasts    Amazon Music

Sign up for the free BAI Banking Strategies newsletter and get industry insights delivered to your inbox.

By clicking the Subscribe button, you acknowledge that you have read our Privacy Policy and Terms of Use and agree to be bound by them.

Below is a full transcript of my interview with Matt Hertel.

Matt, could you start us off with a brief overview of Ultimate Kronos Group, UKG for short, and particularly where the company, in a general sense, where it fits into the financial services space.

Sure. So we just celebrated our first anniversary, Terry, with UKG. And it’s the merger of two great organizations: Ultimate Software and Kronos. We are a global leader in human capital management and workforce management solutions. Now in the financial services space, we have a specialized products group that deals just with banks and credit unions. Currently we deal with hundreds of banks around the country that utilize our retail banking solutions, which include various technologies from appointments to lobby management to analytics, long-term capacity planning and branch staff scheduling.

UKG recently came out with what the company is calling its 2021 appointment study. So Matt, could you tell us a bit about the parameters of the study and also why you did the study? What were you trying to learn?

To frame up this study, in general, we’ve operated in this space since 1990 and we’ve been doing studies in FinServ here since 1992. Dating back that far, we have teller line studies and lobby studies, but we came out with the appointment studies in 2017. This specific study deals with over 100 customers with nearly 1,500 locations and well over 100,000 appointments. The purpose, really, was to see how customers use this technology and compare and contrast the results from 2021 to prior studies.

We really wanted to identify trends in the data to see what’s going on with the customers and the consumer, see frequency of usage of this technology, as well as typical branch stats – what does the activity look like for each location?

So what did you end up learning from the study? Could you maybe share with us at a high level what the key findings, what some of them were from the study, and whether any of those findings came as a surprise to you or the team at UKG?

Probably the greatest takeaway from the study was just how much customers have taken to the technology. The usage has exploded in the last 12 months, maybe last two years. We saw specifically year over year, a 1,000% increase in this adoption. At a higher level, the explosion is definitely the biggest takeaway. When we look at the data at a deeper level, we saw that the average branch had a monthly number of appointments around 85. And with 20 business days in a typical month, that means about the typical branch at around four appointments per day. So that’s kind of the bread and butter of where that technology impacts the branch staff, the branch network. And I would say probably, if there was a surprise it would be in the area of virtual meetings. Before the pandemic, I can’t say we had a lot of usage in non-face-to-face use of the technology – phone appointments, virtual meetings. But because of that, we have just seen an explosion in the virtual realm. And I would say probably the earliest adopter in that area was Zoom. Certainly there’s other technologies – Teams, WebEx, GoToMeetings. So there’s a lot of offerings out there, but the use of Zoom meetings was probably the biggest surprise to me.

UKG offers appointments setting software as part of its businesses, as you’ve said. But this was something that you were doing prior to the pandemic as well. Of course, no one could have predicted the disruption and the sudden needs created by the pandemic. So when you all were thinking about appointment setting as an idea and when you were turning it into a product, what was the original problem you are trying to solve for?

Well, historically, customers would walk into the branch and if the right resource wasn’t there, or if you’re trying to schedule a mortgage closing, for example, from your underwriting department, there was a lot of back and forth to try to schedule a meeting with the prospect or the customer – emails, phone calls, voice messages, things like that. So the whole idea was to automate the process, eliminate that back and forth of the manual communication, and just let the customer pick the right time, the right location that worked for them, and that provided the bank with the opportunity to meet their needs. Ten years ago, this type of technology was really forward thinking, but with that boost that we just talked about of over 1,000% increase in the last year, the adoption of this type of technology to simplify the process, to make sure that the customer needs get met, and it’s with the right resource the first time, that first-stop resolution, is really what we were trying to solve with the technology here.

But to be clear, I mean, that 1,000% boost, that 1,000% increase in usage that you’re talking about, that is pandemic-driven, right?

I would say most of it is, correct. Certainly that brought it to the forefront, made the need greater, and we certainly didn’t anticipate that type of growth outside of the pandemic, that’s for sure.

So what did the study turn up as the most common banking products or services the customers were seeking when they were looking to make an appointment? And what does that tell you about what may be of interest to the banking community?

Well, the findings in the study resulted in 58% of the appointments were for revenue-generating products. Forty-two% were service-related appointments. So the split has changed a little bit from prior studies, which were more in the 60-40 range, 65%-35% products to services. So I think because of the pandemic and the customers reaching out for more service-related types of appointments, it really made an impact on those one-on-one meetings for the revenue-generating products – consumer loans, for example. So we found that in the results, new checking accounts and consumer loans were far and away the most requested products and the most requested appointments. So obviously, that’s really the bread and butter for banking, where we live in this space and how we meet those needs. So the other, following those top two were some service-related – medallion signature was pretty high as well, because obviously, you can’t get that anywhere else besides in a bank. And so that was the highest on the service side.

So we’ve been talking about the impact of COVID on digital banking. By some reports, there have been banks that have said that in the first year or so of the pandemic, their migration to digital sped up by five years. They basically did five years in a single year. So looking at specifically at your appointment study findings, what did you see in the results that you can clearly point to as being pandemic-related? And what might that mean for when the pandemic is behind us?

User adoption was significant. And I really think that was driven by the need for social distancing – the pandemic directives for how do we move forward with the current environment? So a few years ago, we’d never talked about social distancing or anything like that. So I think that was a significant driver in the adoption. We started working remote, schooling moved out of the classroom and into remote teaching. There were just so many reasons to have to deal with things in the pandemic, and I really think it was driven by not being around large groups, not being in branch lobbies where others were waiting. And that really drove, then, the virtual appointments taking off. I didn’t see that. And as a long banker, I can totally appreciate that now because of the pandemic, but that was really what I saw take off. I don’t know if that’s going to continue past the pandemic. I certainly think, from a needs perspective, that’s still going to be there in the high-value areas, which would be trust and mortgage and areas of the bank that are very high-touch, high-value. But I don’t know if that virtual type of meeting is going to continue in the mass area, where we’ve got more frequent touching and more frequent traffic.

Matt, we’re in the midst of a vast rethinking about the role of the branch as digital banking becomes more widely adopted, and this is particularly among younger Americans. Staffing is a big variable that we hear more about, a future of fewer and smaller physical locations, and there’s also a heightened focus on delivering a personalized customer experience. So how should we be thinking about appointment-setting in this broader idea, this broader framework of transforming branches?

I think the appointment software really has been impacted by the move to mass need from that high-value, frequently touched interaction of trust and investments to more of a revenue-generating need. What we’ve seen, and the activity because of this has been incredible, and the usage has been very frequent. With the fewer branches, the smaller physical spaces, customer service is more and more important because they are coming in less frequently, so it’s more important to make sure we take care of each of those interactions. And a virtual meeting is now replacing a lot of the face to face foot traffic that we have had in banking over the years. As a long-time banker, when I was in the branches, customers would come in repeatedly, frequently. The younger consumers find less reason to go into the branches. When they do, we really need to make sure we cross-sell, we maximize that opportunity with those because we don’t know when they’re coming back in. That might be our one and only shot to deliver all the impact and products and services that we can and gain their wallet share.

Whenever there’s an appointment system in place, there’s also last minute cancellations and people who just don’t show up at all for their appointments. So do you have any data that might gauge how much of an issue that is at this point, particularly with this large increase in usage, maybe what causes it, and whether there’s anything that banks and credit unions can do to address it?

So Terry, in our 2019 study, we found that the no-show rate was around 4%– 24 out of 25 appointments showed up as planned. By comparison, this year, the overall no-show rate was just over 10%. So breaking down that no-show rate by time of days shows that the earlier in the day the appointments were scheduled is when the no-show rate was highest. So before 10 am is when there was the greatest no-show rate an opportunity. The flip side of that is we had the highest completion rate for appointments after two o’clock. So between two and close is when the customers showed up most frequently. But what’s interesting is when you look at the face-to-face, in-branch meetings compared to the phone and virtual meetings that we had with customers, the virtual meetings were really low. That was around that 4% rate that I mentioned was typical in 2019. Phone no-shows were a little bit higher at around 6%. But in this study, the in-person no-shows were a lot higher than in 2019. They were over 10%. So I think that the no-show was really impacted in this study by the pandemic and especially with the highest rates being before 10 o’clock in the morning. I think people had concerns that would develop overnight, the night before the meeting, and that’s why the no-show rate was higher first thing in the morning and significantly higher – two and a half times higher this year than it was in 2019. So what I think that banks and credit unions can do, knowing that the highest or higher no-show rates are in the morning, is maybe not offer appointments before 10 o’clock. Maybe offer more of the times in the afternoon, after lunch. And I think they would see an improved completion rate, rather than the higher no-show rates in the morning. They would have more successful appointments. They would be better prepared. And it could also level out their workloads if they’re not busy in the afternoons now. Drive some of the appointment activity to those hours when it’s slower and they’re more likely to show up. So I think that banks in the branch network can adjust to that just by evaluating the no-show activity at their own organization.

So Matt, let’s wrap it up here. Where is the front edge of this appointment-focused technology, this approach to customer service? And where do you see it going in the years ahead that could make it even more impactful as an application than it is today?

I believe I’m pretty sure we are at that front edge with the high-value, high-touch customers. They have expected this type of service, and I think the banking industry has delivered that. But for the high-volume area, the masses, kind of, if you’re looking at a bell curve, that middle chunk of consumer, I think that’s still ahead of us. Financial institutions are going to need to embrace this technology going forward for the masses. The young consumer is not going to be coming in the branches as much, but yet they have service expectations that need to be met. So we need to offer the ability to these consumers, these next-generation customers, the ability to reach out, let us know what they need, and we need to meet those needs. I have two kids that are in that next wave, and they both have told me that they see no reason to go into the branch. Now, they’re not homeowners yet. They don’t have large retirement chunks yet. But as the new generation or next generation of consumers mature, I think that we’re going to see middle of the bell curve need this type of technology and they’re going to expect it. And I think that the virtual and phone meetings are probably where that front edge is – no longer just one-on-one meetings with a prospect or a customer, but it could be one-to-many where we have one banker presenting to groups of first-time home buyers or one banker presenting to groups of IRA prospects or wealth management types of candidates. So I think this technology is going to continue to evolve in the front edge for the high volume of customers is still ahead of us.

Yet another area in which changing customer expectations stand to drive new offerings from institutions trying to keep up with the competition. Matt Hertel from Ultimate Kronos Group, thanks again for being with us on the BAI Banking Strategies podcast.

Thank you, Terry. My pleasure.

Terry Badger is the managing editor at BAI.