The Video Advantage in Banking
In 2012, the average mobile user made at least one video call per month and by 2017 it is predicted that at least five video calls will be made each month, according to Cisco’s recent Visual Networking Index (VNI) Global Mobile Data Traffic Forecast. Video communication is becoming a common theme for businesses and consumers and that theme has emerged throughout retail banks as well.
Twenty-three percent of consumers in developed markets and 43% in emerging markets saw the use of video conferencing as a way to enhance the quality of advice in situations where the access to quality expertise is a concern. As a result of this trend, branches have begun to implement solutions that center on video and collaboration as they look for ways to differentiate themselves, provide better service for customers and at the same time increase operational efficiency.
Retail banks want to provide customers with an experience that cannot be replicated currently in the home, thereby giving a reason for the customer to come into the branch. Today, banks are also beginning to use video in the branch to grow top line revenues in a very tightly regulated environment with increasing downward pressure on fee revenues. With video integration in the branch, retail banks can virtualize their pool of experts and make them available to more branches in their footprint, at a lower cost.
It is apparent from survey results conducted by Cisco clients using video-enabled collaboration, that bank customers are very comfortable with using video solutions to conduct their financial business. Most of the reasons stated have to do with being able to get their questions answered or look into a new product or service at a time that was convenient to them (no scheduling and having to return to the branch for the meeting).
Again, based on survey feedback shared by our customers, this acceptance of video transcends multiple generations, with Gen X and Gen Y consumers as well as baby boomers and seniors becoming more comfortable with using the technology. For example, a mortgager recently told us that about a third of their customers who engaged with video technology to start the mortgage application process stated they would choose banks offering the video solution over those that do not.
Video actually addresses several use cases in the branch. First and foremost, the investment in the infrastructure and technology can be used to drive top-line revenue for banks, especially in the areas of small business banking, treasury and cash management services and mortgage applications. Mortgage processing times, for example, can be drastically reduced. The technology can also be used as a cost-avoidance mechanism. Banks are using video to train internal branch-based employees on new products and services and enable experts throughout the company to collaborate prior to customer meetings.
Video interactions decrease the time it takes to engage and address the customer’s needs or questions and at the same time avoid unnecessary travel expenses by the bank. It enables retail banks to grow and scale resources out to branches, especially in rural areas, where in the past it was either time- or cost-prohibitive to have someone stationed in those branches to meet with customers. In other words, it enables bankers to virtualize their resources and make them available to more customers. Although most of the interactions over video are currently taking place in a branch-to-branch or branch-to-contact center context, many solutions vendors are working to extend video capability to other channels, such as the Internet or online banking, mobile and the home.
There are some notable challenges that banks face when looking at rolling out video-based services into the branch and contact center environment. In most cases, the network bandwidth allocated to the branches is sized to allow for voice traffic as well as to run the applications on the teller line and provide basic e-mail, file and print capabilities. Most bandwidth-intensive tasks, such as imaging and file transfer services, occur after hours so as not to impact applications and availability while the branch is open. The fact remains that the branch network will need to be upgraded to support the addition of video calls during banking hours. Bandwidth to the contact center is often less of a concern, but the addition of video-based services in those locations should be accounted for in the network architecture for the contact center that will host the service.
Once video is introduced in the branch, the amount of bandwidth required to deliver that experience increases. The amount of the increase depends on the number of video endpoints that are deployed and the quality of the experience you want to deliver to the customer. In some cases, current business process and workflow may require modification. Video adds an additional element to a business process that originally may have only included a phone interaction from the contact center. One common theme often heard from customers is that voice and video quality are important. Customers are looking to have an experience that cannot be replicated from the home via a web camera and publicly available Voice Over Internet Protocol (VOIP) services and software applications.
When video is implemented across the branch footprint and multiple products and services are offered over the solution, the benefits outweigh the cost exponentially.