Banks That Neglect Personalization Trends Now Will Sacrifice Online Banking Customers Later
Consumers most value online banking features that address communication and personalization, according to recent surveys by Gartner, Inc. However, financial institutions could be failing to capitalize on online banking by not providing the features that consumers really want.
“As consumer adoption of online banking increases, banks are searching for ways to differentiate their services while maximizing the cost-effectiveness of self-service channels,” said Stessa Cohen, research director at Gartner. “Online banking represents a key opportunity to achieve these objectives if banks can provide the features that consumers prize most highly.”
In December 2008 and January 2009, Gartner surveyed of 3,988 consumers 18 years or older in the U.S. and U.K., and it examined the attitudes and behaviors related to retail payments, banking and investments services.
The survey found that U.K. and U.S. consumers are heavy users of online banking and have many online banking choices. More than half the consumers in the survey said that they used only one online banking site, but more than 40 percent use two or more online banking sites (41 percent in the U.S. and 48 percent in the U.K.), meaning that they are in a position to compare online banking features on a regular basis. As a consequence, banks that fail to provide similar features and capabilities will be at risk of losing their online banking customers.
When asked to indicate the importance of 18 different online banking features, both U.S. and U.K. consumers ranked security the No. 1 feature, followed by single sign-on as their No. 2 feature for online banking. They also ranked highly the ability to deposit checks online from home and the ability to set up a separate account to save up for a specific goal. Other top ranking features included the ability to set up alerts for account and credit card balances and the ability to analyze spending and cash flow.
Gartner found that younger online banking consumers value features that enable customization of their online banking experience, while older customers seek tools that let them use current services more effectively or communicate better. Further analysis indicated that older consumers want features that make the online banking channel itself easier to use, while younger consumers are looking for additional financial planning tools to help them manage their money more effectively.
“The survey showed that banks and customers want very different things on a bank’s Web site,” said Ms. Cohen. “Customers want to personalize their experiences, analyze their transaction and payment data, so they can better manage their money, pay bills and transfer funds,” Ms. Cohen said. “Banks want to sell customers more products. Banks that neglect personalization trends now will sacrifice online — and possibly mobile — banking customers later.”
Gartner advises banks to measure their ability to meet current customer requirements by analyzing the features ranked most highly by consumers in the survey against the capabilities of their own current online banking site. Based on these findings, they should then plan a path to increased personalization, including features ranked lower in the survey in order to enable the bank to differentiate in the future and meet emerging consumer online banking requirements.
Once new online banking features are available, banks also need to ensure that customers are aware of them — high percentages of consumers surveyed report that they were not aware that the features that they consider very important were available from their bank.
Additional information is available in the Gartner report “Top Five Online Banking Features Address Communication and Personalization.” The report is available on Gartner’s Web site at http://www.gartner.com/DisplayDocument?ref=g_search&id=1022727&subref=simplesearch.
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