Key Takeaways from CBA Live 2024

In a world where instant gratification is the norm, the banking industry has started indexing on speed as one of the biggest competitive advantages. But consumers are no longer just looking for speed – they want it all: consistency across channels, self-serve options, proactive outreach, a human touch, and personalized recommendations. In addition, speed typically comes with added expense to fulfillment teams and requires front line staff to chase customers down to complete the rest of their account setup steps.

This week at CBA Live 2024, Marc White, Head of Solutions Engineering at Blend, delved into the importance of delivering a superior digital banking experience, while drawing parallels with the fast food industry. In this session, Marc covered the essential ingredients for winning bank primacy, growing deposits and depositors, deepening customer relationships, and creating quality “food” fast – not “fast food.”

There is a wealth of information about a person that exists, whether through their online presence, social media accounts, or the financial institutions and merchants they interact with. The companies that have differentiated themselves have found a way to leverage that information to better address the needs of the person.

This wealth of information also means that consumers are constantly being inundated with opinions masquerading as sound advice. In other words, it’s becoming increasingly difficult to parse through all that noise to find quality guidance.

So, what is the key to reaching these consumers and cutting through the noise? Typically, a person is most comfortable doing what they already know – and if what they know can become easier, they are more likely to choose that path. That’s what influences their purchasing decision.

Before we dive into the qualities of an excellent digital banking experience, there are some important lessons we can learn from the fast food industry. McDonald’s was founded in 1948 with a core business principle of catering to as many people as possible. They focused on a limited menu – burgers, fries, and shakes – selling them for half the price in half the time compared to competing restaurants.

McDonald’s became known for their order-at-the-counter service vs. relying on waiters and waitresses. Instead of cooking each meal to order, the food was prepared ahead of time and kept warm under heat lamps. Their key metric was speed.

In the 1950s, McDonald’s started franchising and today they have over 40,000 stores in the U.S.
Their objective to make food as quickly as possible for as many people as possible remains the same. And that’s what consumers know and have come to expect with fast food establishments. It’s the place you go to when you need something fast and convenient; you’re not necessarily expecting something healthy and fresh.

In the late 1990s and early 2000s, the concept of “fast casual” dining emerged. Their business model was to continue to serve food fast, but they prioritize fresh, high-quality food with fewer frozen or processed ingredients.

In 2004, the documentary “Super Size Me” was released, changing the way people viewed what they choose to put in their bodies. Suddenly, there was an overabundance of information out there about healthy eating, diet culture, and the importance of fresh, nutritious ingredients. People started making more informed decisions about their food choices. They still wanted food fast, but they now also value high-quality options, personalized recommendations, and easy, intuitive experiences.

Today, Chipotle, Shake Shack, Sweet Green, and Panera are all examples of fast casual establishments that focus on quality ingredients and personalization without sacrificing convenience and speed.

So, what did McDonald’s teach us? People will always be focused on doing what they’ve been doing, and it’s even better if you can find an easier way to do it. And perhaps most importantly, education affects behavior.

Similarly, the banking landscape has witnessed significant shifts in consumer behavior. With a growing preference for digital banking channels, traditional brick-and-mortar branches have seen reduced foot traffic. According to a Forbes Advisor 2022 Digital Banking Survey, 78% of adults in the U.S. prefer to bank digitally, expecting seamless, rewarding experiences from their financial institutions. However, outdated technology and inconsistent service hinder banks from meeting these expectations, leading to decreased customer loyalty.

To address these challenges, banks must prioritize the full banking experience, not just speed. The best account opening process offers a people-centric, automated, end-to-end experience, accommodating various account types and structures. By simplifying the account opening process and surfacing relevant product offerings, banks can reduce abandonment rates, increase efficiency, and deepen customer relationships.

Here are the essential ingredients for an excellent account opening experience:

• Prioritize the full experience: Speed, funding, cross-sell, and omni-channel are all important aspects; not just speed to open.
• Make sure you are able to support a wide range of account types: The inability to support certain account types and structures can cause customers to abandon the process before they even start.
• Provide self-serve options: Making it easy for customers to self-serve means the account requires less involvement from a banker to get completed, saving time, money, and resources.
• Look for appropriate cross-sell opportunities: Surfacing complementary products or services that meet the customer’s needs can help deepen relationships. On the flip side, offering a product that a customer isn’t qualified for may lead to abandonment.

The key to delivering delightful banking experiences lies in balancing speed with quality and leveraging technology to automate manual tasks so you can focus on the most important thing – your relationship with your customer. By embracing proactive approaches and offering personalized financial advice, banks can win customers for life.