The Benefits of Omnichannel Technology in the Banking Sector

What is Omnichannel Technology?

Customers are now accustomed to personalized ads like movie recommendations, suggestions for shopping or courses they can study, funds they can invest in, or insurance they can buy, etc. They want more than just the availability of information and accomplishing tasks online. Banks must look into the customer’s convenience and preferences. The omnichannel strategy makes this possible.

Customers are offered the same services anywhere, anytime, and on any channel. Interconnected channels enhance the customer experience. For instance, customers can start applying for the loan online and finish it in the branch office.

From Multi-channel to Omnichannel Approach

A multi-channel approach is offering transactions with the bank through multiple channels like the physical branch, mobile app, website, or social media. All channels function individually in this approach.

Omnichannel takes it one step further and connects all these channels in real-time. Such synchronization ensures a seamless experience across all channels.

Omnichannel has a Consumer-Centric View. It focuses on interactions between banks and customers across multiple touchpoints. It takes advantage of growing technology and huge amounts of easily accessible user data to create a superior Customer Experience.

Omnichannel Platform provides cross-channel consistency and Consumers transact or interact with the banks via any of the available channels. It also ensures better communication and creates a positive brand image.

Benefits Omnichannel Technology

1. Channel Usage According to the Customers’ Preference

In Omnichannel Banking, all the channels provide the same information and service. Customers can approach the bank branch about an issue and can call later to check on its progress. The bank’s server will send a message to the customer to inform them that the issue is resolved. Multiple channels are well connected to ease the customers’ journey.

2. Improved Customer Support

Data collected from customers across multiple platforms is synchronized in real-time and stored at a single place (server or cloud). Customers can approach any channel and give their account number. The support staff will be able to see previously made complaints immediately and can easily update the customers on the current status of their query/complaint. They can check their balance or loan status on the same platform (channel).

An added benefit is that customers do not have to repeat their information or questions over and over again in an omnichannel experience. Support staff, both online and face-to-face, have full information regarding a customer due to a centralized database. Thus, Omnichannel Banking creates a zero-frustration, seamless user experience.

3. Improved Data Collection

When customers interact with their banks on any of these channels like a website, mobile app, or social media platforms, their data is collected and stored.

Data like customers’ online behavior, location, emotion, preferences for products and services, etc. can be stored (with customer’s consent) via multiple channels. This can be analyzed using Big Data to derive meaningful insights and offer personalized products, services, or ads. This helps banks in offering personalized service experience to their customers.

4. Time-saving

By having a centralized database, even chatbots can answer standard questions. Customer care representatives can take over when and if needed. The repetition of information is unnecessary. Wait time in branches is reduced, thus leading to efficient operations and time and cost-saving. Omnichannel creates efficient use of resources due to readily available organized information. This helps in cutting down operational costs also.

5. Improved marketing strategy and higher conversions

• Customers’ interests, behavior, and needs are recognized using Big Data Analytics. Banks will be able to target their potential clients with customized marketing, offerings, and advertisements.
• For instance, When Rajesh visits a car website, the bank will analyze this data. Later on, when Rajesh plays YouTube videos on his phone, a car loan advertisement will pop-up or play in between those videos.
• If Ruhee visits a real estate agency, her location is collected and she gets a home loan advertisement when she browses any social media platform on the internet or uses banking app, or visits the bank’s website.
• Such tailored marketing approaches result in higher conversions as compared to a regular advertisement.
• Omnichannel Marketing Strategy also reduces the cost of marketing to attract new customers, as it is targeted to a specific audience.

6. Higher Customer Retention Rate

Customers aren’t impressed by conventional service. Having an understanding of the clients’ needs and demands will help the banks to provide personalized banking solutions. It results in increased customer satisfaction.

Happy customers are not only loyal but also recommend the bank to their friends and family. Word of mouth publicity will also result in more conversions as they are trustworthy. Such references increase the customer base and reduce turnover.

7. Increased Security

Omnichannel Banking facilitates Multi-Factor Authentication (MFA). It means the user requires to provide more than one verification factor to access the account. This secures the customers’ data and prevents any cyberattacks.

For instance, when Ruhee tries to withdraw cash in an ATM, she is required to enter an OTP sent to her registered mobile number. A combination of multiple security measures like Google Authenticator, passwords, branch visits, etc. is used to provide maximum safety.

Disadvantages

• The omnichannel platform requires a change in the banking organizational structure. It requires all the departments to coordinate with each other. Initially, this seems costly, time-consuming, and tedious. However, its benefits are far greater at a later stage for the banks.
• Customer information collected across different channels must be available in one place. Fuzzy data has to be converted into usable information. Such development requires more investment in IT resources for complete technological redesigning. So, again the initial set-up costs will be high, but the benefits can be reaped later on in form of targeted advertisements and offering customer-preferred ads on various social media platforms.

Conclusion

Traditional models of banking are inadequate in catering to the needs of the millennials and tech-savvy customers. Banks must incorporate an Omnichannel platform to personalize the customer experience. It helps banks form a deep connection with customers. Moreover, in times of pandemic, omnichannel technology has proved a boon for all the banks and financial institutions.

Customer satisfaction and customer data will determine the growth of the bank. Hence, investing in enabling the Omnichannel platform is crucial to provide a seamless experience to the customers.