The ubiquity of smartphones, an increasing focus on customer convenience and new disruptive innovations mean banks and consumers increasingly interact through digital platforms.
There were 14 million downloads of mobile banking apps in 2014 according to the BBA’s most recent research. Digital banking is now considered mainstream and customers naturally expect to be able to seamlessly move between mobile, internet and branches to access their accounts.
However, the customer-facing veneer often belies the capabilities of back office IT, which is creating issues for banks. Without putting omnichannel strategies in place to connect customer communications, they are vulnerable to financial and reputational risk.
The key benefit of creating an omnichannel strategy is it’s the only way banks can ensure that customer experience is the same no matter the channel. It establishes a single view of the customer and means that one channel can influence another when it comes to communications.
Many banks typically face challenges caused by fragmented back office systems, which mean that different elements simply don’t talk to one another. For those who don’t establish an omnichannel strategy – there’s significant risk of FCA fines.
The FCA places an obligation on banks to keep an auditable trail of where and how statements and other critical documents have been shared with customers.
Email is the main way banks notify their growing number of digital customers that their statements are ready to view. However, those with full inboxes or out of date addresses won’t receive notifications. Without an omnichannel strategy, bounce backs from these addresses don’t necessarily trigger any action, for example a letter going out to alert the customer that their account has gone into overdraft or the bank is having an issue reaching them. This puts any communication trail at jeopardy and leaves banks open to regulatory breaches and subsequent fines.
Getting around legacy IT
Mergers and acquisitions across the sector have left many banks and building societies with unconnected systems that control different communications. This makes the journey to an omnichannel approach harder for the sector than it is for others.
A grass-roots IT upgrade would require huge levels of investment. However, this doesn’t leave banks without other options. They can look at ways they can work with the systems they have to bridge gaps between channels.
We worked with a leading building society to remove the risks created by fragmentation by implementing an omnichannel platform that sits in front of their systems. This cleanses all email data initially, applying simple hygiene checks on each address to ensure it has an ‘@’ symbol in it, or a .com or .co.uk. Any that aren’t correct are filtered into a second database, which is then supplemented with any email that has caused a bounce back after notifications are sent out.
Customers with these non-working addresses automatically receive a printed letter as a reminder to update their email details and to let them know that their statement is ready to view online. Each month this process is managed between the print and digital communication teams and when an additional email address is added to this ‘bounce back’ database, it automatically triggers a printed letter to go out to the customer – maintaining the bank’s audit trail.
Think like a customer
Banks face a whole host of regulatory issues already and this may feel like just another issue to be addressed. However, there are other incentives to build an omnichannel strategy beyond the threat of a fine. The lack of an omnichannel approach leads to significant confusion in customer journeys.
Implementing a strategy can also help banks adapt and adopt new trends. This is particularly valuable when it comes to new customer-facing technology. Introducing digital wallets such as Apple Pay, for example, can run without a hitch. Customers have to verify these via an SMS notification and, much like the email example above, if a mobile number isn’t correct this can make the process cumbersome and quickly frustrate customers.
Gone are the days when people stayed with their bank from cradle to grave. Consumers are more willing to switch than ever before. Guaranteeing the same experience no matter the channel, and minimising instances where customers have to resend information, is a crucial strategy in ensuring customer loyalty.
Banks need to establish the best way of work around outdated legacy IT systems and move towards omnichannel communication. This will not only ensure data is organically updated, it can protect against hefty fines and at the same time help them respond to the rapidly evolving ways in which customers want to interact with their bank.
Kevin Mills is business director, banking & financial services, at Communisis Plc, which delivers omnichannel marketing, transactional and regulatory customer communications for brands across print, digital and mobile channels.