The observation that today’s up-and-coming, digitally-obsessed millennial generation is displacing the self-absorbed, want-it-all-now baby boomer generation has, frankly, been beaten to death.
Sure, on any sidewalk, in any shopping mall, you can see people shuffling zombie-like, their smartphone six inches from their eyes, their thumbs flying and their screens pinging. But take a closer look and there really is no demographic delineation regarding this stereotype. Boomers are as likely to do this digital shuffle as any Gen Yer.
In banking this translates into the proliferation of retail channels and how they are configured. Branches get “staffed,” so to speak, with kiosks and smart ATMs and interactive teller machines, for example. Then, of course, there is online banking, mobile banking, and tablet banking. Remote deposit. Digital signatures. It goes on, personal touch replaced by digital links, and everybody is doing it.
And who knows what’s next? Already on the horizon, in something called the “internet of things” as well as “wearable technology,” direct human interaction could be supplanted not only by preprogrammed instructions but by artificial intelligence that decides things for you.
After all, already IBM’s Watson computer has won Jeopardy!, and many cars now parallel park automatically. How great a leap is it to imagine a day when a digital banking program decides for you that you just can’t afford that $15 grande double mocha frappiano with triple shots, and disallows your purchase? (Presumably, you had previously opted-in to such a set up, but still…)
Which makes it somewhat heartening that recently evidence has emerged that people—even the millennials—not only appreciate the personal touch, but in many cases prefer it.
Here’s a quick rundown:
• Javelin Strategy & Research’s study of underbanked consumers in the mobile era estimates that there are something like 64 million in this group, mainly younger consumers. One of its conclusions: “[The] underbanked rely heavily on digital interactions for their financial transactions, yet they also appreciate high-touch. Over 40% of underbanked consumers demonstrate a preference for face-to-face interactions.”
Of course, this is qualified somewhat in that the preference for high-touch varies considerably by the type of financial activity involved.
• NICE Systems, in its global customer experience survey, determined that 88% of all customers elect to pick up a phone and call when they have customer service issues.
“On average, customers use about six different channels to contact companies for various customer service questions, issues, or complaints, ranging from social media to email to trying to solve the problem by themselves on the company website,” says Yochai Rozenblat, president of the NICE Enterprise Group. “The usage of multiple channels continues to grow, especially in the areas of social media, online and direct chat platforms, and apps. Yet, the majority of customers still prefer to speak with a live service representative over the phone to get their issue resolved quickly.”
Synergistics Research surveyed small-business checking account holders and found that 60% have one representative or relationship manager at their financial institution who manages most of their company’s overall banking matters. Of the ones who don’t have such a personal relationship with their financial institutions, 60% say they would be interested having one.
“Although low tech, the personal channel should continue to receive ongoing high priority for expanding and strengthening small business customer relationships,” says Genie Driskill, COO of Synergistics.
Before taking this argument too far—that the personal touch remains all mom-and-pop and apple pie—there’s no denying that the digital onslaught is unstoppable. New technologies appeal to all sides of the equation. Customers want convenience, quickness, security, and control, all of which technology provides. Banks want efficiency, effectiveness, economy, and customer satisfaction, all of which technology can provide. And third-party providers, who lead in the research and development of all this technology, take great pains to provide exactly what banks and their customers want.
That leads to the observation that providing the high-tech and the high-touch at the same time becomes something of a marketplace art.
Max Colangelo, leader of Accenture’s Banking Industry for much of Europe, gives this example:
“When a customer is car-buying, an email can effectively summarize and provide the bank’s suggestions for the purchase. By reviewing a wealth of the customer’s accumulated transaction data—acquired through an opt-in basis—the bank can recommend a make and model that best suits the car-buyer’s needs, and that information can be bundled into a compelling electronic report.
“But when that same car buyer is ready to haggle, speaking to a live person might better build the trust needed for that singular transaction.”
Thinking about all this, there’s a danger that it can be somewhat disheartening. It goes to reinforce the adage that bank channels never go away, new ones just are added. Credit cards have not displaced cash. Debit cards have not displaced checks. ATMs have not displaced teller lines.
The notion that there will always be a need for a human in the equation, after going through all the effort to automate the business in many, many ways, could, if one were not careful, cause one to say, “Here we go again.”
On the other hand, the human channel is different. Humans have needs that other humans can provide when machines can’t.
Colangelo puts it this way: “Something critical can be lost in the technology shuffle—something banks, in particular, cannot afford to lose. That is, the human touch. Without the strong, reassuring sense that a real, caring, and empathetic person is somewhere involved in the monetary process, banks flounder.”
Sources used for this article include:
- Bank Apps Being Used More Than Ever, ABA Finds
- Enhancing Diversity & Inclusion in the Financial Sector: Practical Strategies for Recruiting and Retaining Diverse Talent
- Bank of America to Co-head Quest for Merger Deal for Ailing Italian Bank
- Banking in the Era of Uncertainty
- The “DEBT TSUNAMI” and What It Means for Banks