Banks are remodeling the in-branch experience by bridging their digital and human delivery channels to enhance customer-centricity and service delivery to stay relevant to their audience.
For most retail and wealth customers, the conventional bank branch experience and day-to-day banking activities have been shifting to online platforms supported via digital channels for the past 15 years. Disruption to the banking industry comes from Fintech companies, powerful telecom networks and online retail behemoths forcing the financial services industry to view their traditional and digital channels as connected entities, rather than isolated business formats. To optimize performance, meet consumer demand and remain profitable, branches need to become more productive and less costly and to retain staff that will adhere to a new wave of customer-centric service orientation. To achieve this, banks are needing to go back a step in order to move forwards, that is by fusing their digital functionality with human interaction to extend the personal touch of wealth management advisory for new account customers, whilst retaining the loyalty of a higher tier of wealth customers.
Big Data is supporting banks’ goals by bringing clicks and bricks into greater alignment with virtual and video banking bringing customers closer to their banks. Now call center agents have even greater access to customer information, allowing a richer conversation and level of interaction to troubleshoot a gamut of concerns from run of the mill card and ATM access and payment issues, to understanding the workings of their accounts and knowledge of other wealth products. In many ways, branch innovation is drawing inspiration from the 5-star hospitality industry in paving the customer journey. By reframing all aspects of the branch model beginning with the use of engaging language i.e. calling customers “guests” and offering to “serve”, enhancing user experience means melding branch aesthetics with ergonomically well-embedded, easy-to-use technology and coupling this with human assistance at every touch point, to match the in-branch experience with its online proposition.
Future bank branch transformations will rely on Human Centered Design (HCD) or Design Thinking. While not an entirely new idea for technology firms, who tend to focus first on the consumer experience, HCD’s 5 tenets namely Empathize (develop a deep understanding of the challenge,) Define (articulate the problem,) Ideate (brainstorm and develop solutions,) Prototype (attempt a variety of solutions) and Test (continuous short-cycle innovation to test your preferred solution), are encouraging changes within banking.
Boston Consulting Group’s (BCG) report Global Retail Banking 2017 demonstrates that in emerging markets, including Asia-Pacific, Latin America, the Middle East Africa, and Eastern Europe that with rising discretionary incomes, robust GDP growth, and a larger population of banking customers, retail banks will continue to experience strong growth accounting for 75% of the industry’s CAGR over the next several years. BCG’s surveys also show that customers want choice in how to engage with their bank and that they expect service to be consistent, streamlined, and engaging no matter what channel they use. While 43% of survey respondents indicated a preference for digital-only experiences, the same percentage said they want a mix of physical and virtual interactions—a hybrid banking experience, in which digital tools and capabilities combine with human input and advice at the moments that matter.
Over 50% of customers surveyed via BCG’s REBEX benchmarking and its latest Retail Banking Customer Survey in China, Colombia, Italy, Russia, Spain, the United Arab Emirates and the United States, said they prefer this type of hybrid banking relationship. BCG analysts posit that to enable this hybrid model, banks must go Bionic and that by accelerating bionic transformation, retail banks can generate a 30% increase in net profit by 2020. A bionic transformation consists of blending digital and personal interactions to create a more responsive and cost-effective distribution model by combining human judgment with data power and mapping a customer journey with end-to-end processes supported with robotics and machine learning. BCG advises that, at branch level, banks must create multiple branch formats, embedded within a well-rounded multichannel experience. The research forecasts that banks that move to a bionic network can see revenue gains of 5% to 15%, network cost reductions of 15% to 35%, and increases in customer satisfaction of 10% to 15%.
These new drivers of the future hybrid branch can ensure that customers are well equipped to reach their desired financial goals. By learning and documenting customers’ experiences and issues and then responding to this feedback by creating solutions, banks now capture customers’ emotions so that to on-board and retain clients, institutions can assure customers that their problems will be solved, their time will be well used and they will feel valued.