The phrase “omnichannel” is one that many banks and financial institutions are familiar with; though, to this point, many organizations have had a hard time making the transition from “buzzword” to business practice. However, with more people relying on multiple devices in their day-to-day lives, especially in banking, the time has come for banks to fully embrace an omnichannel approach, or risk falling behind.
First, it’s important to define exactly what we mean when we use the term “omnichannel banking.” Fundamentally, the term refers to an approach that is customer-centric and channel agnostic in nature. As an example, consider a customer who initiates a loan application process via PC, mobile device or in-branch; however, they cannot move in between channels easily once the process has started. With an omnichannel approach, however, a customer can start their application on a laptop, ask questions over the phone and then finish the process on their mobile device allowing them access to their accounts, transactions and information anywhere, anytime, through any device – seamlessly and without repetition.
In order to execute a successful omnichannel strategy, organizations need to understand what that transformation will mean and more importantly, how it will impact every aspect of their business. Here are four considerations that financial institutions must account for in order to succeed.
1. Modernizing Legacy Systems: Financial institutions are striving to develop a holistic, “single customer” point-of-view that maintains a consistent look and feel for the customer, regardless of the financial product they are dealing with. However, this presents a problem in terms of legacy systems that many banks have in place, as these systems tend to operate in silos. In order to overcome this, a completely open structure will be necessary – and banks will have to walk the line between leveraging technology to modernize their system without having to re-engineer their entire network.
2. Big Opportunity With Big Data: The next consideration centers on data and what to do with it. There is an immense opportunity for financial institutions when it comes to Big Data and advanced analytics. Through Big Data, businesses can glean the insights needed to provide a more polished user experience, bolster their identity theft and fraud prevention methods, develop more targeted loyalty programs and product offerings, and even artificial intelligence to predict certain behaviors. Big Data is also a powerful tool to help inform investment decisions, as it can keep enabling banks to stay a step ahead of prevailing trends, opportunities, and threats. Banks must account for this data and have a plan for how to leverage it.
3. An Integrated Infrastructure: A successful omnichannel ecosystem will need to account for and integrate across three layers: the core banking platform, the “middleware” layer, and the user experience (UX) layer, which is what customers see and where they interact. To successfully integrate these layers together requires a combination of private cloud – which banks traditionally use for maximum data security; and public cloud – which allows more flexibility and less limited access to and storage of data, in order to scale and get to market quickly.
4. Security is Top-of-Mind: Finally, of course, is the importance of having security measures in place that underscore every aspect of a transactional journey. Besides the identification and verification security that the customer sees, the omnichannel infrastructure must also include data center, network, infrastructure and application security, next-generation firewall services and distributed denial of service (DDOS) prevention services. Additionally, new technology like identity-based micro-segmentation and encryption can help banks fortify their security, by creating segments within an organization where only authorized users can access information, while those without authorization cannot even see that those endpoints exist. This extra layer of security goes beyond the firewall by rendering devices, data and end users undetectable to unauthorized users.
Ultimately, the goal is for all of these steps to be addressed behind the scenes. By creating an environment where the customer is able to recognize the rigorous security measures in place – without seeing or feeling a hindrance in their own ability to bank with flexibility and across different platforms – the banks will be in a good position to build customer loyalty and drive future growth.