Today’s European bank sites don’t sell, but they will — if banks integrate today¿s siloed apps through scenarios targeted at specific products and consumers, according to a new report by Forrester Research (Nasdaq: FORR).
“Eight million Europeans have already bought a financial product online, and leading European banks are reporting a ramp up in Net sales of simple products like unsecured loans and credit cards. To see how well equipped today’s sites are to cross-sell, we evaluated Europe’s top 20 banks — and all failed,” said Forrester Senior Analyst Remus Brett. “Firms don’t let their customers view what they own; they don’t help them assess their financial position; they don’t offer meaningful financial advice; and they require users to start from scratch when making product applications. But now that most banks have a critical mass of experienced online users, they must gradually shift their Net focus from “cost cutter” to “revenue generator” or watch their online operations continue to pile up losses. They will do this by extending business with those who are ready to buy online, and by matching their online offerings to consumers’ buying experience curve.”
Forrester advises that banks knit together today’s siloed apps to create a complete online purchase cycle. Scenario Design — linking banks’ business objectives to their customers’ online goals — will make them identify the information required to support the process. By combining standard financial segmentation like assets and demographics with online experience and affinity, banks will find that they must treat technology-optimistic, self-directed investors differently from mainstreamers, who need more human help. Smart banks will imitate pioneers like Egg, which sold 2.8 million products to 2 million online customers by phasing its offerings to match consumers’ experience curve. To kick-start online selling, banks must analyze all the possible stages and decision moments from product awareness to purchase — and map the data flows required to support these processes. Scenarios must also address cross-channel customer needs, such as the stage at which different consumers will require telephone or face-to face assistance.
“These scenarios will require a redesign of the Web site and a toolset that will bring the bank closer to the components of Open Finance,” Brett added. “To give users a consolidated view of all their products, banks first need to reconcile the up to six different ID codes that they hold per customer. Pioneering banks will use Web services standards to take existing customer ID data from an app and return it in a cleaned, canonical form. To let online users access the data required to assess individual product or portfolio performance, banks must deploy financial services hubs to extract the relevant data tied up in multiple legacy and CRM systems. To ease the data flow, firms should deploy caching software to hide infrequently accessed data like prior daily balances. Europe’s upcoming broadband boom will present banks with two key opportunities to support online sales through low-cost collaborative advice and agent cobrowsing. Finally, to stop customers abandoning lengthy online applications and dismissing planning tools in frustration, banks need to prepopulate online fields with all known customer data.”
For the report “Making Europe’s Online Banking Sell,” Forrester evaluated Europe’s top 20 banks, using the principles of Open Finance. Forrester’s Open Finance review measures how a site helps customers complete a purchasing cycle by seeing if users: 1) understand what they own; 2) understand how they’re doing; 3) receive advice; and 4) execute transactions. We rated sites against 21 functional criteria grouped into these four categories, on a scale from -2 for a strong fail to +2 for a strong pass. Even the highest-ranked sites — ABN AMRO, HypoVereinsbank, and Halifax — failed to reach the pass mark.