Each year, CSI assembles its Banking Priorities Study–a benchmarking survey in which banking executives from across the country share their thoughts on a range of topics to shed light on their strategies and plans for the coming year.
For the 2017 survey, more than 160 banking executives, representing institutions of various asset sizes and geographic locations, answered 10 questions on what they expect will be their greatest challenges, top opportunities and foremost concerns for the year ahead.
The study always sheds light on the most pressing issues facing the industry at that particular point in time: Four years ago, a good portion of the respondents indicated a growing confidence and comfort in cloud adoption, which was just coming to prominence at the time. And last year, respondents ranked mortgage-related regulations as their greatest compliance concern heading into 2016, as banks were busy digesting the Consumer Financial Protection Bureau (CFPB)’s final rule on the Home Mortgage Disclosure Act (HMDA).
And this year’s study is no different.
When asked about their greatest challenges going into 2017, a whopping 72 percent of respondents said driving growth and profitability was their greatest challenge–up from 29 percent last year. This question was setup a bit differently than in past surveys, as CSI supplied answer choices for the first time, which included driving growth and profitability, mitigating fraud/cybersecurity and managing compliance.
It’s no surprise that driving growth and profitability was the No. 1 answer, as this area has been, and will continue to be, a major challenge for financial institutions across the country. As the number of customers using digital channels to access their personal finances and execute transactions continues to increase, so will the need for institutions to provide their customers with the most seamless and efficient banking experience across their various channels to ensure growth and profitability.
Accordingly, there seemed to be a pervading focus in this year’s study on creating an omnichannel experience from all respondents. In fact, almost a quarter of respondents (23 percent) listed pursuing an omnichannel experience as their biggest challenge in 2017. This is a very telling statistic in regard to the strategic road map that banks could follow in 2017, as the notion of omnichannel banking to improve customer experience figured prominently in responses throughout the report.
So why is omnichannel banking so important? Because it’s what your customers expect.
In a blog post about omnichannel banking, CSI CEO Steve Powless wrote that if your customers’ online experience is not cohesive with what they encounter when they walk into your branches, those customers might look to conduct their business elsewhere.
“The time is now to evaluate your current offerings and identify where you need to go to achieve full mobile and Internet channel integration,” Powless said.
When asked about the areas in which they expect to increase spending over the next 12 months, 56 percent of respondents said Information Technology, while 55 percent answered that they expect to increase spending on customer service initiatives. Increased spending in both of these areas is another telltale sign that banks will be working, and spending, toward implementing omnichannel initiatives this year.
In fact, for the first time in the history of the Banking Priorities Study, respondents were asked about specific omnichannel strategies they plan to pursue in the coming year. Over half of those surveyed (57 percent) said implementing customer relationship management (CRM) software was their No. 1 omnichannel strategy.
An integrated CRM opens up communication and streamlines coordination between all business lines and banking channels, enabling banks to hone in on the banking channels their customers prefer. In addition, integrated CRM software helps financial institutions proactively anticipate individual customer product and service needs.
Mobile banking adoption (47 percent) and online account opening/funding (46 percent) were also popular answers to the omnichannel question. Both of these strategies are important for banks who wish to retain their current customers, as well as attract new, younger consumers who expect a full suite of digital banking solutions.
According to Millennials and Banking, a survey from the American Bankers Association (ABA), 67 percent of millennials (and 50 percent of other customers) want digital budgeting tools from their bank. Also, almost a quarter of respondents (23 percent) cite lack of a mobile app as the main barrier to bank engagement.
In his article, Omnichannel Banking: More Than a Buzzword, Jim Marous, co-publisher of The Financial Brand and owner/publisher of the Digital Banking Report, said developing strategies to integrate disparate digital and physical channels into a single, seamless experience has to be a priority for financial institutions.
“Building a positive omnichannel experience remains a work in progress for most banks and credit unions. Research shows that when done well, an omnichannel experience can strengthen relationships, streamline the experience and increase profitability.”
Through the 2017 Banking Priorities Study, we see that banks have taken this concept to heart. And the responses prove that banks are placing a heavier emphasis on pursuing omnichannel initiatives this year. What about you?
Download the 2017 Banking Priorities Study.