[Research] Financial Sector Success Contingent on Digital Engagement
In today’s digital world, we all expect simple, intuitive interactions – no matter what. So it should be no surprise to those in the financial services sector that their customers are also starting to increase their demands.
Whether the goal is to make an investment, research new credit options, or take out a loan, your customers are now in charge. They expect your products to be competitive in the market and personalized to their unique situation in life. And above all, your customers expect to access this information easily online, across web, tablet, and mobile device interfaces.
The online experience that you build will make or break your institution’s success. In fact, Forrester Research indicates that successful online engagement drives loyalty, raises net promoter scores, and is cheaper for the business.
The two pie charts showcase the results of two survey questions, where Forrester Research reviewed how new channels promote branding and customer loyalty. Overwhelmingly, respondents say that they are more likely to recommend a bank or stay with a bank if they are already using mobile banking capabilities.
While mobile banking is a clear necessity in today’s digital environment, there are a number of other important digital avenues that financial groups need to explore. An Accenture study found that already 72% of customers are active users of mobile banking. But 82% also cite that they are interested in digital financial products and services.
As my headline suggests, financial groups need to facilitate better digital engagement if they wish to succeed. While customers may be interested in engaging through digital mediums, they will not tolerate a poor experience. And as the Internet reduces barriers to entry, even within the financial services industry, you should expect your competition to grow. 72% of customers say that they are just as likely to bank with non-financial services companies.
In fact, 35% of banking revenues will be at risk by 2020 due to disruption in the financial sector. To compete effectively in today’s digital climate, the financial sector needs more than mobile banking functions. Gone are the days of paper-based origination processes and highly commoditized products. Your competition is looking for a way to use digital mediums to their advantage and you need to respond quickly.
Deutsche Bank announced plans to shrink its securities business and other non-performing lines, reallocating EUR 1 billion towards a new project to create a more digital bank over the next three-to-five years. But large, multi-national businesses can be sluggish; they may have plenty of money to spend, but they may not be as nimble with change.
While niche, and mid-sized institutions have fewer resources and smaller budgets, they have greater autonomy and agility to quickly progress new projects. The time to act is now. Beat your rivals to market through rapid, continuous innovation. It’s time to think like a software company.
Do you know your top digital priorities? Find out how you can compete and win against your larger rivals. Download this eBook for more information on the business applications that can significantly impact your online engagement.