The Bankwatch

Tracking the consumer evolution of financial services

World Retail Banking Report 2013 | CapGemini / EFMA

The new CapGemini/ Efma World Retail Banking report is out today. This is the 3rd annual. 

A link to the full report, press release and infographic can be found here.  Its 40 pages and worth the study for anyone in bank channel strategy and management.

Paris, New York – April 23, 2013 –  Within the next six months, ten percent of retail banking customers surveyed globally will likely leave their bank and an additional 41 percent of customers say they are unsure if they will stay or go finds the tenth annual World Retail Banking Report 2013 (WRBR 2013) released today by Capgemini and Efma. To re-build the customer-bank relationship, opportunity exists for banks to become more customer-centric by leveraging vast amounts of customer data and by further developing mobile capabilities to create more personal interactions. The cornerstone of the WRBR 2013 is its extensive customer survey and Customer Experience Index (CEI)[1] which measures perceptions of 18,000 customers in 35 markets about the factors that matter most to them across channels, transactions and products.

 

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The report is an interesting of assessment of banks customer experience around the world, and development of potential solutions.

The is a great definition of the problem banks face in the commoditization of their products.

Banks have historically had difficulty distinguishing
their products from one another, and in recent years the
problem has only intensified. The look and feel of basic
banking products has remained largely the same, with
very little innovation forged in terms of linking products
or developing them outside their traditional silos.
Attempts to differentiate on price too have been curtailed
in recent years due to regulatory and cost pressures that
are keeping rates universally low.

As new channels have become available, the industry has
moved in lockstep to add them, creating an environment
in which most banks have at least a presence in every one.
The sole exception may be mobile, which the industry
is currently in the process of broadly adopting. The
retail delivery ideal has evolved into being able to make
any product available through any channel at any time.
However, banks often bolted on new channels instead of
fully integrating them with existing ones.

It then goes on to  speak about what interests me and the various channels and how banks can improve their customer experience there, versus what many have done and merely bolted on new channels, particularly mobile and merely presenting similar offerrings.

Where the Customer Experience Index (CEI) improved the most, credit is given to improvements in mobile and telephone. (Philippines & Portugal).

Next is the positive correlation between understaning of customer needs and customer experience.

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Finally the link is made between knowing the customers needs through data and using that data to support the channels appropriately.

The focus really turns to mobile and rightly so.

The correlation between age and positive experience seen
for branch and internet banking does not hold true in the
case of mobile banking. Because they are less familiar
with the full array of mobile functionality, customers of
all ages have a lower tendency of positive experience with
mobile. In addition, increasing age appears to have little
relation with more positive outcomes in mobile as in the
other channels. In North America, for example, 34% of
older customers have positive experiences with mobile,
compared to 41% of younger ones. As banks continue to
make investments in improving their mobile capabilities,
the overall number of customers with positive experiences
associated with the channel is expected to grow.

There is determined to be a direct correlation between Customer Experience and Product Channel fit.

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The report assesses the digital maturity of banks based on their finding that:

The study found that a firm’s level of digital maturity
is strongly correlated to its profitability and efficiency.

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Banks rank high with 35% in the upper right quadrant.  Mind you that means 65% are not there.

Interestingly the challenge facing banks is quite similar to that facing FaceBook and Google.  But banks have an important asset that those two do not … customer specific data.

The next frontier for mobility is to use the mobile
platform to enhance marketing and sales. Banks already
are using mobile messages to welcome customers and
inform them of new products.

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Finally the report follows through to the logical conclusion

Becoming a Customer-Centric Bank by Leveraging Data

 

Banks have access to more customer data than ever before and this must be more effectively
utilized for relationship-building to succeed in the future.

  • ƒƒBanks today have tremendous amounts of customer data available to them, but are able to
    successfully leverage only a small fraction of it for delivering actionable business insights.
  • ƒƒExtraction and cleaning of data is as important as analyzing it to gain customer insights.
  • ƒƒBefore technology investments are made, firms need to be more successful at defining business
    objectives and aligning the necessary technology to support those goals.

The remainder of the report provides a useful discussion on the nature of data that Banks’ possess and makes the case for a more rigorous and scientific data driven strategy to support customer experience in the channels, and particularly mobile and online.

Written by Colin Henderson

April 23, 2013 at 23:15

Posted in Uncategorized

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