Customers demand more from financial services these days, especially now that software-based financial technology (fintech) providers offer digital alternatives. Digital disruption is forcing banks and other financial services towards one solution: digital transformation.
Learn how in the newest infographic below from VMware AirWatch, “Banking on Digital Transformation.”
Customers Care Less About Traditional Financial Services
The results of a Gallup Panel revealed that customers are decreasingly engaged with (or in other words, emotionally connected to) their primary bank. Fully engaged customers bring in 37% more annual revenue, but according to the results:
- Only 33% of Baby Boomers are fully engaged with their primary bank,
- An even smaller 26% of Generation X customers are fully engaged and
- Just 23% of Millennials are fully engaged.
The least engaged generation, Millennials, just so happen to have the highest share of wallet with their primary bank, according to Gallup:
- Baby Boomers: 61%
- Generation X: 64%
- Millennials: 69%
In fact, 1-in-3 Millennials could switch banks in the next 90 days, and 33% of Millennials expect banks will be unnecessary in five years, according to the Millennial Disruption Index! About 73% of Millennials are more excited about fintech products than traditional bank services.
About 2-out-of-3 customers worldwide already use fintech products, and 88% of customers across regions trust fintech providers, according to the World Retail Banking Report 2016 by Capgemini and Efma.
To boost engagement, banks must give clients what they want: digital interaction. However, banking IT investment for customer experience lags far behind.
Globally, financial services spent $459 billion on IT in 2015, according to IDC. About 80% of that was spent on compliance, security, risk, infrastructure and data. Only 20% was left to invest in the customer experience.
Line of Business Demands Work and Productivity Apps
Financial services employees also want to work digitally anytime, anywhere and on any device. Most banks expect front-line staff to use tablets soon (92%). In the financial services industry, 95% of employees already use mobile messaging at work at least a few times per week (even though 38% of financial institutions don’t provide mobile messaging apps).
- Application development/testing environment
- Customer relationship management
- Collaboration and content management platforms
But barriers to fully adopting and implementing business mobility in financial services persist. More than 50% of financial institutions encounter security and compliance issues with mobile deployments.
The top concerns include security (52%), budget (42%) and skills (33%). Another 43% of IT executives can’t move forward on mobility because of a lack of integration with legacy systems, according to Gartner.
That is a lot of pressure on IT, but a simple, single solution exists. You can adapt to always-on consumers, empower employees with secure mobility and transform financial services.
Gallup, Millennial Disruption Index, Capgemini and Efma, IDC, Celent, Infinite Convergence Solutions, Cloud Security Alliance, VMware, Gartner