The quality of service measures the efficacy of any omnichannel banking model

For all the jargon associated with omnichannel digital banking, the concept is quite simple. With an omnichannel framework, banks will be able to simultaneously service a customer across all channels seamlessly, while customers get to engage with all channels with an identical experience, without having to be asked for the same information continuously. More than 70% of customers typically use two or more channels, and building the capabilities to meet with this demand is what omnichannel banking is all about. Just to put things in perspective, while multi-channel architecture focuses on the transactions, omnichannel architecture tends to focus on customer experiences.

The name of the game, therefore, is customer experience. But then, what makes an experience better? What makes digital consumer behaviour favourable to a bank? Transparency, relevance and personalisation are the keywords, and delivering them through a ubiquitous, seamless manner that is instant or as near-instant as possible is the winning formula. Customer experiences are best measured not just by the increase in the transaction volume or value, but also by the loyalty and retention of the digital age customer – which is easier said than done.

Defining digital customer journeys

Reorienting the omnichannel interactions, and the design of banking products and services has now seen a paradigm shift, where the ‘moments of truth’ that best describe the customer’s experience across each touch point, and the definition of KPIs around it, are taking centre-stage. Keeping the customer at the centre of any transformation is the fundamental mantra for any bank to win in the digital world and is no longer an option. And the customer should be able to access the bank from any channel – be it the traditional points of interaction such as the branch, ATM or the contact centre, or new age mobile channel, which is growing much faster than the share of interaction from its digital cousin, the web. Mobile channels have reportedly recorded the highest increase in revenue generation.

Understanding the context, defining the expectations and measuring the experience that the customer demands are all critical in defining customer journeys. Having the mobile to be just another interface of a web UI, for example, could be a grave error, as many banks have learnt it the hard way – just because, the ask on a mobile channel is very different from an internet banking channel. For instance, knowing where a local ATM is located is possible using a mobile GPS on an app or widget, not on the web channel.

Differentiated channel experience based on a persona is manifested in the way banks respond to their needs. For instance, a millennial customer is more comfortable with a self-tutorial, but a senior citizen may need a conversational instruction. And this is where industry innovations transcend beyond channels. A good example here is that of Belgian bank Argenta, which has recently announced a conversational experience on the mobile channel, using a single thread, with all previous chat history being maintained as part of its mobile app.

There are three key paradigm shifts driven by the omnichannel experiences:

  • Shift from a bank-centric view into a customer-centric view;
  • Focus more on interactions and moments of truth, instead of transactions and processes; and?
  • Not designed just to deliver on ‘perceived needs’, but also able to determine ‘predicted wants’.

The best customer experiences are delivered when both physical and digital channels co-exist, effectively complementing each other. This also implies that banks would need to connect with third-party applications to create new ‘application eco-systems’ with a lower cost of delivery.

Building an omnichannel technology

The advent of ‘API Banking’ has made the need for seamless interaction across systems and the ability to switch between devices much more necessary than before. The experience of the customer through the full cycle of the financial activity – executed across each device or channel – has to be both consistent and accurate. A typical open API-friendly technology architecture would deliver a scalable plug-and-play across devices and for hosting new outsourced marketplaces.

Typical challenges faced by banks are not so much in visualising the customer expectations, but more in building the infrastructure to deliver on it. When the back-end systems are siloed, or worse still the integration across the front and back end systems are convoluted, the experience is not seamless. An easy-to-relate seamless experience is what one gets when a video watched on a tablet can be continued on the mobile, from where it was last left. Starting the screening of options on the web, making an application on the tablet, signing up on mobile and getting the fulfilment completed at the branch, can all be done only when you have a fully integrated omnichannel platform. The reality, for the most part of the banking systems, is not an easy picture. To manage multiple tech-stacks, from different vendors, and continuous review of the upgrades and integrating siloes of customer data into one single meaningful digital omnichannel platform would be a pre-requisite before the customer experiences an omnichannel universal experience across his or her journey. The steps to delivering a good customer journey cuts across five stages:

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  • Assess: Determining the needs, goals and thought process of the customer persona;
  • Analyse: Map touch-points to each stage of the journey, across each of the channel;
  • Design: Build the storyboard and design, with a 360-degree feedback loop;
  • Implement: Develop the prototype and measure customer adoption across each channel; and
  • Measure: Identify deviations to the journey, and measure customer impact.

An agile approach delivers quick results that meet customer demands, having a ‘customer-first’ orientation of providing what the customer needs, rather than a product development approach that simply offers a bouquet of services for the customer to choose from – whether or not it is aligned to the expectations. An interesting use case is that of HDFC Bank, that allows the ATM to default the last transacted ‘language’ for the next transaction, thereby reducing 40% of the interaction time.

Omnichannel digital payments

An interesting example of an omnichannel application is in the area of payments. Digital payment processes are next-generation customer experiences, transcending mere transaction enablement, by integrating a host of smart payment and data solutions. They should provide the customer with a seamless experience at the point of purchase – across the web, tablet mobile, branch or social media, and drive an end-to-end value chain including issuing, payment processing, loyalty programs and e-commerce. This will encourage a fully digitised transaction lifecycle.

The omnichannel behaviour of the customer is best reflected when the research on e-commerce sites are done on the mobile; analysis is made on the computer on the web; and the actual purchase is made at the physical store. Apps will then need to be linked and integrated, on a singular platform – to have the entire customer journey across channels, to be seamless and to also ensure there is a smooth exchange of data, predictive analytics enabled insights and customer information to be transferred across applications in the back end.

ACI, for example, has recently announced its next-generation terminal payment applications post its acquisition of Revchip and TranSend, and also a collaboration with BioCatch to apply behavioural biometrics to prevent online frauds. Backbase has announced an alliance with Jumio to leverage on online identify verification capabilities, and enhance the onboarding capabilities

Connect to the digital ecosystem

Ultimately, how do banks benefit from an enhanced customer experience, and resultant loyalty and increased retention rates? The answers are essentially driven by a few axioms:

  • Relative cost of incremental acquisition is always lower on a digital channel;
  • The more the channel usage, the better the customer preference awareness;
  • Better awareness results in better experience, and a higher product adoption;
  • The greater the product penetration, the higher the average revenue per customer; and
  • Digital delivery models drive down cost of execution.

Reduced cost of operations and improved revenue per customer have a direct correlation to the bottom line. Simply put, a good omnichannel digital banking model is one that ultimately gets you a net positive impact. At the end of the day, that ultimately does count.

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