Before the onset of the pandemic, digital banking during COVID-19 surged, which in turn drove financial institutions to seek to create better consumer experiences. However, COVID-19 created an urgency by banking customers and left financial institutions struggling to understand how to serve their customer segments going forward.
A PWC study, completed before 2020, found almost 73% of respondents consider the customer experience an important factor in their purchasing decisions but particularly influential in healthcare (78%), banking (75%), restaurants (74%) and hotels (74%). The same survey found only 49% of U.S. consumers said companies provide a good customer experience at the moment. It found closing any customer experience gap requires finding that sweet spot — where technology complements the human element of customer experience without creating new frustrations. That perfect balance is still the goal.
Digital Banking During COVID-19 and After
The Digital Banking Post COVID-19: Digital CX Banking Report surveyed more than 500 banking customers in June, more than 135 days after the first documented COVID-19 case in the U.S., to explore and describe the mindset and behaviors of banking customers. We wanted to learn whether the pandemic changed customer needs and wants. What did they expect before COVID-19 hit and what are their expectations currently? Have customers changed their perceptions of digital banking since the lockdown?
We uncovered customer perception and behaviors and categorized them into three segments:
- Traditionalists: Customers who prefer interpersonal contact at the branch and will likely return as branches re-open.
- Transformers: Customers who used to prefer branch interactions but are willing to go digital now when “forced” to go digital during the pandemic.
- Trailblazers: Customers who always preferred digital banking interactions and will continue to use online and mobile service and products.
Expectedly all three groups have displayed amplified use of digital banking during COVID-19, as all consumers had to rely on digital services with branch activity disrupted. All these segments represent some of your banking customers, which makes serving them all an ongoing challenge.
However, we found the Transformers, the most dynamic group. While most Traditionalists and Trailblazers enjoy a steady financial institution relationship, most Transformers do not.
Transformers (44% are 25-44 years old) are open to new experiences in banking but feel ignored at times and do not believe their institutions provides them with enough financial advice, which they sorely need and want, especially now. They will use online and mobile banking but are more likely to go into the branch to make a deposit or withdrawal, get cash or cash checks.
Financial institutions have a great opportunity with Transformers. For example, they favor a mix of digital and in-person interaction with their bank or credit union, which might make them receptive to a web chat or video teller meeting.
For banks and credit unions, Transformers seem well prepared, more enthusiastic and adept enough to move to more digital and self-service channels post-COVID-19, having out of necessity already used those channels.