With increasing adoption of digital and mobile channels, along with changing customer preferences, branch banking is undergoing a tremendous shift towards self-service banking. The dilemma for bankers is: how can they service their customers better while they reduce their footprints both in terms of physical location and the number of touch points inside the branch?
As bankers transform the traditional branch banking model and digitally transform their branches, there are three critical ways they are leveraging technology to drive this transformational change:
Leveraging data analytics to offer more tailored services. Banks, by the very nature of their business, have access to a wealth of customer information. As customer interactions at the branch level decline, this has an adverse effect on the bank’s knowledge of the customer because branches were the primary source of knowing the customer. Fortunately, analytics provide an opportunity derive insights from the customer data that does exist.
Big banks in their quest to provide the “right product/service” to the “right customer” and at the “right time” must increase their investments in analytics. By leveraging analytics, banks can develop a more holistic profile of the customer using spending patterns, account balances, and in some cases, social media data to enhance their ability to proactively offer customized products and services to the customers.
Leveraged the right way, analytics can empower banks to gain more granular understanding of the customer beyond their traditional approach of bracketing customers based on more basic information. Monitoring more timely information that customers may share on social media can provide insights into their life events – such as the birth of a child – which give banks an opportunity to proactively offer relevant, personalized, and timely products or services that improve the customer’s experience and increase the value of their interaction with the bank.
Embracing virtual advisors. Related to their increased demand for self-service capabilities, customers are seeking expert insight from advisors and experts. This requires banks to maintain a balance between providing technological solutions and human assistance. As banks transform their branches from being transaction-oriented to interaction-oriented and deploy newer and smarter branch layouts, technologies such as live video chats and platforms for remote advisory can help to balance the value of human interaction with customers’ desire for convenience.
Imagine a customer in a branch of the future guided by a virtual assistant who can perform all the necessary transactions through self-service kiosks and also connect the customer with advisors and experts through video conferencing. Some banks have already started to embrace remote advisors in their mobile applications, creating competitive differentiation and enhancing the overall customer experience, all while reducing their operating expenses.
Ensuring seamless interactions across any device or channel. As customers adopt digital channels, banks must rethink the way they are interacting with their customers across mobile channels. A recent study found that 55% of Americans access their accounts through mobile banking options (including laptops, tablets and smartphones) two to three times per week. Because of this, banks must take a more holistic view of cross channel and cross device interaction even while they invest in enhancing their mobile app functionality.
Consider a customer looking for a mortgage. That customer may login into the bank’s system from a laptop to initiate the process of filling out the required forms but then use a mobile phone to scan the required documents before they finally reach the branch to sign. Across this process, the customer will use different channels and devices and expect that the bank will provide a seamless interaction. But even as banks embrace new technology that enhances the customer experience at the front end, many are still operating on legacy systems that drag down their overall ability to integrate new technologies.
Bank branches of the future are destined to become the channel for customers to conduct their banking through integrated mobile and online banking experiences. Technology will be critical in enabling banks to reach customers more proactively and make banking more convenient even with a smaller footprint.
Mr. Ramakrishnan is a senior vice president in Chicago with Paris-based Capgemini Financial Services. He can be reached at Kartik.Ramakrishnan@capgemini.com.