Consumer behaviors and expectations are shifting in ways that challenge retail banking providers to rethink their strategy and transform the customer experience.
Banks and credit unions that can deliver both a compelling new digital service model and retain traditional values around trust and service will be best placed for the competitive battleground ahead. This is the conclusion from a study fielded by Accentureencompassing nearly 33,000 financial services consumers across 18 markets.
The research identified the following five emerging trends based on three different types of consumer personas -- rich with insights about how people want to interact with financial providers in future, and where digital innovation must play its part.
1. Data is the New Currency
Consumers are willing to share their personal data with financial institutions, but they want something in return. Globally, 67% of consumers in the Accenture study said they would give banking providers access to more of their data in return for additional benefits. That number jumps significantly in the United States, where 73% of Americans would swap data for more perks.
2. Millennials Are Drawn to a GAFA Model
For many consumers -- particularly Millennials and Gen Z -- Google, Apple, Facebook and Amazon (collectively known as GAFA) are attractive alternatives to traditional financial providers. About 46% of U.S. banking, insurance and wealth management customers surveyed by Accenture said they would switch to the tech giants. That means GAFA could eat up to half of the market currently served by traditional financial institutions.
3. Consumers Warming to Automated Robo Advice
In Accenture's research, a very high number of respondents said they are open to a purely automated service and support experience, even when making more complex decisions around product choices. Consumers are now open to robo-advice to help determine which bank account to open (71%), which insurance coverage to purchase (74%), and how to plan for retirement (68%).
4. People Still Want That Personal Touch
Accenture cautions that it would be a big mistake for financial institutions to commit to a purely digital strategy -- one built entirely around AI, robo-advisors, automation and algorithms. Their study found that nearly two-thirds of consumers still want human interaction in financial services, especially to deal with complaints (68%) and advice about complex products such as mortgages (61%).
"While financial institutions may benefit from internal cost reductions by providing customers with a 'robo' option, our research found that consumers also expect first-class human interaction,” explains Piercarlo Gera, a senior managing director with Accenture Financial Services.
5. Banking Consumers Are Channel Omnivores
The majority of consumers in Accenture's study said they are less and less likely to care about which channel they use to interact with their financial services providers. Their primary concern is that they can get what they need quickly and easily.
"Consumers seem open to new forms of technology and advice, and are seemingly more comfortable interacting with robots for certain types of financial services, their reliance on branches continues,” says Peter Kirk, head of distribution and marketing services at Accenture in the UK. "Banks need to recognize that for many consumers, including the younger generation, the shift toward computer-generated services cannot be at the expense of access to human service at their local bank. The demand for branches seems set to continue.”