Leading Banks Embrace Back-to-Basics Consumer-Driven Retail Banking Strategies

Multi-Channel Expansion, Deeper Customer Purchase Behavior Analysis, and Branch Re-Furbishment Are Top Initiatives


BOSTON, MA--(Marketwire - September 14, 2010) -  Aberdeen, a Harte-Hanks Company (NYSE: HHS), recently surveyed 100 retail banks to determine the current state of consumer-driven process and technology strategies within retail banking that are impacting customer retention and profitability. According to the Aberdeen Group report, New-Age Retail Banking: Five Technology Imperatives for Consumer-Driven Banking, the foremost business pressure for retail banks is "the historically high levels of competition for customer share of wallet" (selected by 48% of responding banks as their top pressure).

This pressure is due to factors such as soft consumer spending trend, price or rate sensitivity of consumers, possible fall-out from financial system regulatory changes that can impact revenue streams and customer relationships, and lagging global market recovery which has slowed down consumer banking. Moreover, the need to ensure timely response to continued growth and the evolution of non-traditional consumer banking channels (e.g. in-store retail banking, online, call center, and mobile) is a pain-point for 44% of retail banks. "The business impact of digital banking (mobile and online) is profound and banks of all sizes do not want to be left behind. Banks and credit unions are and will continue to implement tools that help embrace the digital consumer," says Sahir Anand, Research Director, Retail and Banking and chief author of the report.

As a response to the business pressures, leading retail banks (top 20% of banks surveyed) are focusing on unleashing consumer-driven retail banking strategies rather than a single-minded focus on sales and operations. Forty-seven percent (47%) of leading banks compared to 35% of all other banks are refurbishing bank branch operations. "This action is an essential shift to create a more responsive customer service culture with an aim towards acquisition, re-engagement, retention, and re-activation of lapsed customers. Multi-channel integration at the branch is a key step for creating a unified view of all bank brands," says Anand.

In order to create a consumer-driven service culture, a third of leading banks are re-structuring customer service touch points across all channels. Such a strategy requires process upgrades and technology convergence across channels and touchpoints. In some cases sizeable branch and bank headquarters technology upgrades have been undertaken due to legacy IT infrastructure and lack of inter-operability between customer and operational functions.

A complimentary copy of this report is made available due in part by the following underwriters: Temenos, MFoundry, and Verizon Business. To obtain a complimentary copy of the report, visit: http://www.aberdeen.com/link/sponsor.asp?spid=30410182&cid=6578&camp=2

Visit Research.Aberdeen.com for additional access to complimentary Retail Research.

About Aberdeen Group, a Harte-Hanks Company

Aberdeen provides fact-based research and market intelligence that delivers demonstrable results. Having queried more than 30,000 companies in the past two years, Aberdeen is positioned to educate users to action: driving market awareness, creating demand, enabling sales, and delivering meaningful return-on-investment analysis. As the trusted advisor to the global technology markets, corporations turn to Aberdeen for insights that drive decisions.

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