Finextra – by Balazs Fejes
Omnichannel has become little more than a buzz-word and an unrealistic vision for the retail banking sector. In his blog, Balazs Fejes, SVP and Global Head of Financial Services at EPAM Systems looks to dispel the myth about the application of an omnichannel approach to retail banking. He believes that unlike the consumer retail markets, where the term was coined, the ability for banks to provide all services, across all channels, to all people is an unrealistic ideal.
Digital technology has undoubtedly changed the way we will bank forever. A recent report from the British Banking Association (BBA) showed that in 2013 the customers of the five biggest retail banks downloaded more than 12.4 million banking apps; used their mobile phones for 18.6 million transactions per week; made nearly 40 million mobile and online internet transactions per week; and signed up for more than 457.7 million SMS balance alerts and other text message notifications.
The impact of digital innovation is clear. So too are the changing needs and preferences of banking customers who now expect the companies they do business with – including their banks – to put them at the center of an integrated approach that enables them to choose the channel, service or product that provides them with the most value and convenience.
Against this backdrop, the ‘omnichannel’ vision has become a buzz-word strategy synonymous with financial institutions’ attempts to offer a joined-up, 360 degree approach to servicing customers. However, the application of a truly omnichannel experience to banking nd financial services, I believe, is a stretch. Unlike the consumer retail markets, where the term was coined, the complexities of banking and the financial markets mean that the ability for banks to provide all services, across all channels, to all people is an unrealistic ideal. Banks interact with their customers at a number of different levels, across differing service expectations and different levels of technological sophistication. While the use of traditional banking channels is shrinking in line with a greater use of digital there are still large areas of banking services – those involving complex financial instruments, products or portfolios – where non-digital interaction is still critical.
An omnichannel approach is not simply about delivering the same experience. Its application, particularly in banking and the financial markets, requires a deeper understanding that different customers have different needs and engage with different channels at different stages of the purchasing process." Research from Google exemplifies this, showing that 46% of people managing their finances online switch between devices before completing the activity.
Whether banking services are offered via a mobile, on a tablet, through an ATM or at a bank branch, the omnichannel approach is not about providing a ubiquitous service offering through each of those channels. Instead, it is about having a greater understanding how customers use different channels to interact with their bank and making sure the journey between each delivery channels is seamless. An omnichannel approach should accept that the availability of certain services will vary according to device and look to deliver seamless navigation across multiple channels as a way to enhance the customer experience. Only then will banks be able to simplify their engagement with customers whilst supporting the complexity of products and service requirements that are inherent in the financial markets today.
Original publication is here.