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04. 23. 2018

Banks made a big step in digital sales – W.UP Digital Banking Weekly

Banks made a big step in digital sales - W.UP Digital Banking Weekly

We have some good news: the biggest banks in key markets largely improved their scope and quality of banking digital sales in 2018, according to new research. But there is bad news as well. Digital challengers now target another profitable segment of incumbent banks.

Half of big banks reach Digital Promised Land

The digital sales capabilities of the 50 biggest banks in Europe, North America and Australia significantly improved in 2018, according to Avoka’s latest annual report. Online account opening for personal banking products, for example, jumped to 69% of all products wordwide, more than double where it was two years ago.

Mobile sales readiness jumped 50% in the US and Australia in the past year, but European banks improved at a slower rate than global competitors, with uneven progress across countries, as regulatory changes appeared to slow the speed of digital sales transformation.

Another attractive market slipping away from banks

Strong earnings in European consumer finance have drawn the attention of attackers, including challenger banks and fintechs, McKinsey said. Incumbents must focus on the customer and transform their operating models to maintain their position.

McKinsey brings the example of Sweden, which has been the focal point for this activity with its high rates of digital adoption and well-developed infrastructure for credit scoring and recoveries. Swedish universal banks have lost 35% of consumer-finance volumes in the past 15 years.

“Digital banking? Isn’t that just an app?”

About 80% of the big-bank decision-makers believe they have done digital, while 76% of the decision-makers at most large banks do not believe digital requires any change to their business model, Chris Skinner wrote in his blog recently, citing survey results.

“These results are quite stunning when it is obvious that digital is a massive, fundamental shift of their business model,” he said. Skinner reckons most senior decision-makers simply don’t know technology, which is a clear disadvantage for any digital transformation efforts.

7 Steps to make a digital banking service simple

Easy-to-use services for consumers are in particularly great demand and due to the nature of the human mind it is vital to perceive the world in a simple way, said Alex Kreger, chief executive at UX Design Agency.

Any financial service can get an advantage by delivering a perfect user experience based on a simple interface, he said. By understanding simplicity, it’s possible to highlight the key principles of simple banking. These include predictability, control and ease.

Digital sales: 12 strategies for banks to win in the digital world war