It was the beginning of the 1980’s when ATMs were in their infancy, brick-and-mortar banks were the standard, and being "online" would not become the beloved adjective it is now for 25 more years.
The hyper-evolution of technology, financial services, and data since the ‘80’s has been nothing short of fantastic – from the disruptive players like PayPal to the burgeoning field of electronic payments and mobile banking – think Apple Pay, Venmo, and Square.
So, if today’s customers no longer need to set foot in a physical location for transfers, deposits or balances, what will banking look like in another 25 years? There is no question that banking is close to completely digital now, and it will move even closer – meaning time is of the essence for all of us in bank marketing to envision the future of financial institutions, and how we’ll make the most of it.
More mobile apps and other convenient channels will be available for customers to engage with banks at any time; freed from the constraints of standard business hours. Comparison-shopping for a bank will never have been easier. Will customers pick their banking relationships through crowdsourced applications? Will banking be turned into a game with a financial “Fitbit” type personal monitoring app wrapped around people’s wrists?
A bank’s offerings will still matter, but building strong customer engagement will be paramount. As a customer develops a genuine connection to the brand and benefits from personally relevant services, they will share their preferences, interests and attitudes that will help bank marketers continuously improve their products – if they are listening. Customers will want to be found based on their own highly personalized interests, shown how their banking relationship would be a strong personal asset and they will be willing to maintain a long-term relationship. However, it is important to remember that customers will be continuously expanding their expectations of relevant communications and services – so they may share their personal data only as long as they get valuable banking services in return.
Data analytics will be a mandatory part of bank marketing and sales initiatives, rather than the new business fad it is right now. Today’s struggles with the overwhelming abundance of customer information will have smoothed into highly-tuned business process. With this refinement will come better customer engagement, product delivery, and the excitement of improved line-of-sight to return on investment.
With the evolution to mobile, banks are being forced to examine their traditional service offerings and the definition of a “branch” – giving way to premium branches, self-serve kiosks, and mini-branches. According to Cap Gemini, branches today are 75% of a bank’s total retail distribution costs. When coupled with the fact (as reported by Jones Lang LaSalle) that up to 50% of branches in U.S. bank networks may be declared obsolete by 2020, those that remain are likely to be an investment in augmenting the customer experience with “the human touch” for complex services, rather than for the delivery of standard banking products.
Technology will be a centerpiece of banking. The use of interactive voice recognition, biometric security, talking to a teller from a cardless ATM, gamification of online banking and the like, will be seen as just part of the banking process. It is hard to imagine the disruptive banking technology of the future – but we can be sure it is coming at us quickly. The most adaptive financial organizations will be the winners and their customers the most engaged.