Retail banks are figuring out something that retail stores grasped quite some time ago: They are not in the business of selling products. They are in the business of building relationships.
“Improving sales results is no longer job number one,” the research and advisory firm Celent declared in its recent report on bank executives’ priorities. “Surveyed North American financial institutions now solidly identify improving customer relationships as their top retail banking strategic priority.”
So, have these financial institutions turned their back on making a profit? Not at all. Rather, they have concluded that maximizing profitability means not wasting precious one-on-one time with a customer touting random products that that customer does not need, want or value.
It boils down to this: If you’re selling, you’re simply pushing information at the customer. If you’re building a relationship, you’re drawing information out of the customer. In doing so, you’re figuring out what products a customer is most likely to need, want and value.
As a result, your time with that customer — whether online, on a smartphone, at a self-service device or face-to-face with a member of your banking team — produces maximum profitability for both the consumer and the financial institution.
The first step toward this outcome is customer analytics, as Deniz Güven, senior vice president of digital channels at Turkey’s Garanti Bank explained in “Omnichannel Marketing for Financial Institutions: An Industry Guide,” published by ATM Marketplace and sponsored by Auriga:
Currently, our marketing intelligence can analyze the customers’ behavior and deliver the proper product [offers] to them. We are now migrating our state-of-the-art marketing algorithm into a self-learning system. We expect that in the near future our campaigns will be triggered automatically by a self-learning mechanism itself according to big data analysis …
The second step is omnichannel management and marketing, something that few financial institutions are doing in the fullest sense, according to Mark Aldred, head of U.K. sales for Auriga:
There remains a long way to go before banks can claim to be delivering a truly integrated digital strategy. Whilst most operate over multiple channels and offer wide ranges of services, few have deployed what we understand to be a true omnichannel strategy. It is fair to say that, as a result, many are very advanced in their deployment of certain channels and less so with others. Consequently, they are indeed at only the early stages of the adoption of true omnichannel.
Most financial institutions aren’t quite there yet. But most would like to be and many are either making plans or have a plan in place and are beginning the work of breaking down silos and implementing omnichannel systems. An infographic, sponsored by Auriga, offers a look at today’s omnichannel banking landscape. The infographic is available for download in English, Italian, German and French.