In 1977, Citibank blitzed pre-approved credit cards to 20 million Americans. Easy way to make sales targets eh? In 1978, an article in The Times appeared, condemning Citi for its campaign “Indeed, many bankers are predicting that the nation’s second largest bank will lose its shirt in trying to create a national network of credit cardholders.”
In 2020, CitiGroup have the largest amount of credit card clients in the world.
Unfortunately, in 2020 and probably far beyond, this method of selling, cross-selling and up-selling is no longer viable in Europe with the stringent credit checks now required; so how do banks ‘push’ new products on new customers and current customers?
This may surprise you, but it starts with:
A Bank Branch (but before you cancel shutting all those branches down, read on)
Ah, the bank branch, traditional, sturdy, and completely underutilised for everyday banking which is now done online. “Shut em all down!” I hear you cry. Not so fast. Turns out, that although we’re pretty relaxed with doing online banking for everyday banking tasks, small transfers, checking transactions and to see if we got paid, what we’re not rushing to do is apply for a Mortgage, buy Insurance products, take a loan and over 50% of us (worldwide by the way, except you Norway), are still not even willing to open a new bank account online.
That’s right, and furthermore, not only are we not very digitally adventurous when it comes to anything out-of-the-ordinary with banking, turns out, neither are our parents or our kids. Yip, you read that right. Every single generation that is currently alive and kicking came back with over 47% of them stating that they still want to open their account in a branch. Well I’ll be.
But wait, what?
People purchasing financial products including loans, mortgages, credit cards, and even opening bank accounts are reluctant to do this online. Banks have two things to consider: Digital Literacy, and Financial Literacy. Conquering one may be simple enough, after all, Amazon taught us what self-service was all about. But what about Financial Literacy? Bit more complex than putting something in your basket and checking it out.
Many people have anxiety when it comes to money, some, even a phobia - so when a bank closes its branches and suddenly, entire communities are forced to pay in cheques online, or fill out mortgage applications without a bit of guidance, or even applying for the right loan – they get anxious, which is why up to 80% of banking customers still walk into a bank branch for a mortgage and up to 50% still open an account in-branch.
This leaves banks in a bit of a pickle. Most customers apply for mortgages, loans and bank accounts between 1-5 times in their lifetimes – so, bank branches, as prized as they are with customers who have particular needs, are not used for everyday banking – the footfall of branches is simply too low to justify so many of them remaining open.
Interestingly, many Challenger Banks are struggling to gain the trust for their customers to fully convert and use them as their main bank account – the lack of financial advice and access to a branch could very well be attributing to this.
But how do you shift customers behaviour and expectations?
In short, you don’t shift your customers behaviours or their expectation, you shift, so you can meet them where they are. To achieve higher, more meaningful digital sales is just as much about how you interact with leads and prospects through the funnel as it is getting them there.
Most consumers do their research online – it is rare for a banking customer to walk into a bank and ask for information on a product. However; banks have not yet been able to convert these into digital sales, (coincidentally, the Insurance Industry in many countries is having the same issue) and customers as we confirmed in the stats above, are still going to branches to purchase these.
So how do banks meld the simplicity and ease of online, with the trust and security of a branch?
The Digital Bank Branch (it’s not what you think)
Creating digital options within a bank branch may help the speed at which customers are serviced in-branch; however, it’s not true digitalisation – simply having a self-service iPad in the bank branch did not make the customer’s journey there any easier.
Fortunately, there is another solution that shift the in-branch experience to an immersive online experience.
The Digital Bank Branch is a branch that customers can visit online, either through a banks website, online banking portal or app. Online meeting rooms, whiteboards, screen drawing, document sharing and form filling collaboration are features that closely mimic the bricks and mortar experience. Banking staff can easily connect with their customers and have a seamless face to face experience from anywhere in the world.
Want to see the Digital Bank Branch in action? Simply request a demo below and one of the team will take you through a guided tour.
Don't forget to tell your friends!
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The year is 2020 (‘huzzah’ I hear you cry, and maybe not a delighted cry), and we take ATMs for granted, in fact, many countries are moving to a cashless society where Apple Pay and the good old-fashioned chip and pin card is relied on heavily. (And to the three people who still believe in Cryptocurrency, you’ll have your time to shine I’m sure). However, there was a time where ATMs were not accepted and went through a similar journey as online banking and mobile banking (which almost 40% of the population still does not trust completely).