Community Banker News and Views

By: Dean Nicolls
January 16th, 2019

Customer acquisition is top of mind for most banks and their boards.

This usually translates into new, slick marketing campaigns. These campaigns mean enlisting your advertising agency to cut through the clutter, which is increasingly difficult to do. Or you could look to mine more near-term customers right from your own website and the online account opening process.

More and more banks are onboarding new customers by enrolling them through their website. This process is rife with opportunity. According to The Financial Brand, 40 percent of online bank account applications were abandoned due to a long or complicated enrollment process.

Think about that. Only six out of 10 prospects who arrive at your site—with the intention of creating a bank account—complete the journey. That’s tragic. It makes more sense to fix that leaky funnel than to spend big on another advertising campaign in the hopes of driving significantly more website or branch traffic.

We know that there are a few places in the online account creation process where banks fall down. Let’s dissect some of these pitfalls.

Identity verification. Thanks to Know Your Customer and anti-money-laundering regulations, banks and credit unions need to impose more rigor to ensure the person creating the account is genuinely that person. Thanks to a steady barrage of data breaches and advanced malware, traditional methods of authentication, such as knowledge-based authentication and two-factor authentication, are no longer in vogue. Increasingly, banks are turning to online identity-verification solutions that require a government-issued ID and a selfie to more reliably verify digital prospects. These solutions can be pretty fast and are capable of completing the online verification process within a minute.

Simple messaging. Banks that provide simple, clear instructions, written in plain English, experience much higher conversion rates. This includes providing a clear rationale for why you’re asking online customers for their ID documents and selfie, and what you intend to do with that information.

Fewer screens. Obviously, the more hurdles you put in front of your customers, the less likely they will make it all the way through the account-opening process. So, if you can reduce the number of screens to identify a new customer from seven to four, that will have a material impact on conversion rates.

Go omnichannel. When it comes to establishing identity online, you want to open up the experience to as many channels as possible. Many identity verification solutions only offer a mobile experience, not allowing potential customers to use their webcams on their laptops or desktop computers. By disabling this channel, you’re eliminating a large swath of potential customers who either don’t have a smartphone or would prefer to complete the process from their laptop.

Being omnichannel also means supporting API-based mobile web and native mobile implementations. For companies looking to cast the widest possible customer acquisition net, including some older generations who may not be comfortable with newer technology, it just makes sense for your identity-verification solution to offer the broadest number of channels to your prospective customers.

No more maybes. Another cause of online abandonment are the longer wait caused by manual reviews. Several online identity-verification solution providers return a “caution” decision when they can’t easily confirm that the customer is who they claim to be.

Every “caution” or “maybe” requires manual review by a team of analysts. There are real costs to manual review. Jumio offers an online calculator to illustrate these expenses. These are real costs to your business, and they create real frustration for your customers.

So, if customer acquisition is job No. 1 for 2019, maybe it’s time to fix your sales funnel and plug the leaks with an efficient onboarding experience—one that optimizes and simplifies the identity-verification experience.

You can do the math. Spend big on advertising with iffy results. Or, create a great online experience that is designed for conversion. You’ll end up with happier customers—and a lot more of them.

Tags: Onboarding, Customer Acquisition, Omnichannel, Identity Verification

By: Emily McCormick, vice president of research for Bank Director
December 3rd, 2018
Over the past year, Congress has passed both tax reform and regulatory relief—signed into law by President Donald Trump in December 2017 and May 2018, respectively. And the Trump administration has appointed regulators who appear to be more favorable to the industry, including former bankers Joseph Otting, to the Office of the Comptroller of the Currency, and Jelena McWilliams, to the Federal Deposit Insurance Corp.

The survey examines industry attitudes about issues impacting M&A and growth, along with expected acquisition plans and expectations for the U.S. economy through 2019. It was conducted in September and October 2018.

www.bankdirector.com/index.php/issues/manda/2019-bank-m-survey-whats-driving-growth/

Aleksandar Lenov –  26 October 2018

Can you imagine leaving your home “un-connected”? No smartphone, no smartwatch, no tablet? No way! Neither does the person next to you. That is why today the average number of web-connected devices owned by a person is above three. This smart technology push created an addiction among people – being connected every channel possible. And what are banks to do but be where the clients are. So banks rushed to implement as many channels as possible, just to be faced with another challenge – a new customer behavior called channel switching.

And there you have it, the biggest problem of multi-channel: one channel does not have a clue what happened on the other one, and customers are having a nightmare of an experience. Let’s take a look from customer’s perspective. He sends a request to a bank via email. Eager to get a reply, he thinks it would be much more efficient to address the topic through the website online form, and subsequently does that. However, that particular team, handling online forms, does not deal with this type of topics. So the customer turns to the call centre, hoping for the resolution. Long story short – and it was long for a good reason… In each of these attempts the client had to repeat the same thing all over again. Imagine the aggravation. On the other side, a bank invested at least three times more resources for one customer. Customer experience 0 : Expenses 3

The game was on! The first response was to integrate all that user interaction into one place. Witness the birth of omni-channel, the one that will save us all. And let’s be honest – it did. Now, there is a consistency in customer experience. The process started on one channel is uninterrupted when channel-hopping. The change that happens on one channel is immediately reproduced on all channels in use by the client. This makes contracting and issue solving easier for the client. The customer information is stored centrally and handled from one place enabling banks to deliver a more personalized service. Processes are automated and human resources are used more efficiently. But what if a client predominantly uses one particular channel or wants to use only one channel for bank services? Can all banking services be done on that channel of choice? Also taken into account must be the relevance of the information that banks provide on the channel at a particular time. Is that information useful to the customer at that time?
To put it this way. When is it most likely to ask for help in the supermarket? When there are multiple sorts of the same product, and you need someone to assist you in choosing the right one for you at that time. Here is where the customer support steps in – to offer one or multiple products for the customer to purchase in order to satisfy his need. Opti-channel does a similar thing, determines the optimal number of channels for customer communication for particular customer request. It does not mean more channels. It means the most straightforward customer journey and adequate channel navigation. The other thing is personalization. There is personalization as we know it: you take customer behavior and account history, and send a personalized message, usually via email, at a certain time of month or when there is a marketing campaign. But is it relevant for the client at that time? Is the client even at a place likely to check his email or some other channel? Customers expect an optimal message, at an optimal time on an optimal device. Opti-channel provides such experience by utilizing publicly available geolocation, wifi and beacon technology.

Imagine yourself in a shopping mall just browsing, when you receive a message on your mobile banking app that you can get a discount in the tech store in that mall if you make a purchase with a card of a particular bank, the bank you are a client of. Also, you have been pre-approved a quick loan if you decide to purchase, since your card balance is a little low at the end of the month. Well, that is a relevant offer because you are in that mall, it is the end of the month and you are a little short, but you can not resist a new gadget, which is obvious from your card account history. Talking about personalized, in context, relevant and timely communication. That is the advantage of Opti-channel.
Maybe with artificial intelligence, predicting customer behavior, bot technology and advanced user interfaces only one channel would be sufficient for users. Maybe that will never be the case because we all use different smart devices at different times. One thing is certain for now – we want to be connected at all times. Having that in mind, users will expect to receive the optimal message, at the optimal time, on the optimal channel, based on the amount of data they provide and also based on the time they are willing to spend on banking activity