Omnichannel is the king of the buzzwords in retail banking. It’s the idea that “customers should receive a consistent seamless service across all channels”. In this utopia the branch, phone, web and mobile app all come together as one. But if you’re a fan of omnichannel, you might want to sit down, because I’ve got some bad news.
Don’t get me wrong, ’omnichannel’ had it’s time. Banks needed to make sure that when a customer makes a request on the the phone, it was reflected in their app, and taken into account the next time they go to a branch. It’s a basic need for the different channels managed by different teams to be connected and consistent. We get it.
But omnichannel is doomed, because it’s based on a false assumption. It grows from the idea that ‘channels’ are equivalent and interchangeable. It assumes that whatever the channel, you are effectively interacting with a junior bank cashier to get the same services: “Here is your statement sir”, “of course I can move money between accounts, give me the details”, “yes, your balance is 215 pounds and twenty five pence”.
The problem is that “truly” digital banking isn’t just another channel. It’s not a substitute for interacting with a cashier / teller. It’s more equivalent to having an experienced personal wealth manager watching over your finances 24/7, providing insights and proactively addressing issues. That is a big upgrade!
Like the finest private banker, next generation digital banks (like Monzo) will be proactive and predictive, providing the right services magically just when you need them. They will monitor your transactions when they happen, let you know if your salary didn’t get paid, check that electricity bill isn’t crazy money, and quietly arrange travel insurance in the background when you decide to take a weekend away. Although, no, it won’t give all of the perks of a private bank. No Koi carp, posh coffee, or giant cheque books I’m afraid.
“Truly digital banking will deliver private banking to the mass market.”
This level of service just can’t be delivered cost effectively in any other channel, and the contrast will be stark when a phone call leads you to an Indian call centre operator reading a script, and a branch visit leads you to an overworked junior bank cashier who doesn’t have a clue who you are.
In this context, omnichannel makes no sense. You can’t provide a “consistent seamless service” across all channels, because digital banking will be 10x better than anything you’ve delivered before, and the ‘in person’ experience will seem bizarrely impersonal and lacking.
Even worse, if you hold onto the ideal of omnichannel, your digital approach will never live up to its potential, and all you’ll get is a watered-down commodity service that is held back by previous ideas of what mass market banking can provide.
So as I discussed with an 11:FS client last week, we’re not aiming for seamless ‘omnichannel’ banking, we are heading for something new: “DigitalPlus” . Truly digital high-end private banking supported by staff in different channels who can help customers start to use the digital service, get the best out of it, deal with problems, and provide the human touch where it’s needed.
Yes, omnichannel must die, but only because we can do better.
This is a guest post by Jason Bates, co-founder of 11:FS, Starling and Monzo. Jason co-founded Starling and Monzo, two new digital banks in the UK. As Chief Customer Officer he led proposition and product development of the award winning banking app. Now with 11:FS he is working with global banking and retail clients on creating and launching next generation services.