Omnichannel for Financial Services – Challenges & Steps to an Effective Strategy
The Banking and Financial Services industry is frequently cited as being at the cutting edge of innovation in technology. Omnichannel is the latest in a long line of such buzzy phrases and one for which each institution must formulate a strategy to stay competitive. Views on what omnichannel actually means are diverse, and there is little consensus within the industry on just how “omnichannel” traditional institutions can become. There is a huge gap between the idealistic talk of the concept and the practical reality of actually implementing it. We write here a quick overview on (1) the concept and the current landscape, (2) common challenges and risks of implementation, and (3) how Ness is helping Banks and Financial Services institutions on their journey to serve customers across digital channels.
The Current Omnichannel Landscape
Omnichannel can be defined as providing customers with a consistent experience across channels, with seamless access to financial products and services—where, when and how they want to bank. This of course embraces branches, online, mobile, video and social. It is set to touch wearables, in-car and even the Internet of Things. We believe that in the financial services industry, the idea of providing exactly the same services to all people, across all channels, is unrealistic. There is a nuanced omnichannel agenda for each institution, given that they all have differing views of their customers and the ways in which those customers currently engage with different channels.
Recent studies highlight the omnichannel imperative. The Internet is already the most preferred virtual channel for conducting banking transactions, such as managing accounts and transferring money. According to research conducted by thefinancialbrand.com1, 86% of customers declared to have used online banking in the last six months vs. 79% of traditional branches. Mobile is also readily accepted as a convenient channel with 71% of the customers using the bank’s mobile app, according to a report by the U.S. Federal Reserve2. Consumers love mobile banking features like real-time expense tracking, mobile payments, and location-based commerce. Video is another enabler for building trust in situations where people are not physically available. Social banking is in its early stages, as customers are still reluctant to mix banking with social activities, but brands like Funding Circle and eToro use social techniques very effectively. Heritage banks have started using social media to launch new products, make announcements and drive new conversations with their customers. It’s somewhat inevitable that the number of services offered by banks through social media will grow swiftly in the next few years.
Challenges of Implementation
However, there are many challenges in improving your omnichannel offer. Our experience helped us compile a list of the most common activities that the financial sector is struggling to come to grips with:
- Address an inconsistent and confusing look and feel when accessing banking services through different devices and entry points.
- Establish a connected, 360o view of your customer and their behavior across channels.
- Guarantee that each transaction follows a consistent and logical template across all the channels.
- Implement a core platform to support integration of data points to surface customer-centric data insights.
- Make the business case for investment to promote enhancements in channel capabilities.
- Provide the ability to automatically retrieve customer account and transaction history, at the point of first contact, to personalize the customer experience across touchpoints.
How Ness Is Helping Financial Institutions Define Their Best Path
Ness Software Engineering Services (SES) is a valued partner with many global financial institutions in helping them design and implement an omnichannel vision. We bring external expertise in User-Centric design, Business Process Management, Business Intelligence and Data Analytics to consult on the best approach to break this complex exercise in Digital Transformation into logical phases, which mitigate risk and maximize opportunities to create internal champions and external validation of the vision.
We’ve broken the approach down into five simple steps in promoting an effective omnichannel strategy:
- Develop a business case. Assess existing channels while exploring new channels to capture insights and describe the way ahead.
- Use our Ness Connected framework to develop a strategy, where the actionable insights translate into the enterprise architecture, which carries the seamless channel experience.
- Rationalize your application portfolio to determine which are worth aligning to your omnichannel strategy and which are not.
- Use Data Analytics capabilities to promote and validate the experience with customers in order to optimize and tailor the channel-specific shopping experience.
- Evolve with changing customer needs and digital behaviors by exploring unused or emerging channels.
The “right” solution for omnichannel in banking is the one that makes the unique customer experience offered by your institution even more attractive and compelling to your customers and prospective customers. The trick is figuring out what that is and making it happen. That’s where we come in.
Sources:
1 http://thefinancialbrand.com/37996/bank-channel-usage-research/
2 http://www.federalreserve.gov/econresdata/consumers-and-mobile-financial-services-report-201503.pdf
