What young people want
Whilst there has been a huge shift in recent years to mobile banking, with most consumers preferring to access mobile channels being far more frequently for day-to-day interactions, there is, what some might consider (not including me though), a surprisingly high number of consumers who still want to visit branches. In a recent survey from Fiserv, who spoke to over 3,000 banking consumers in the United States, we discover that consumers chose a number of channels through which to conduct their banking, depending upon the task they wish to perform. For instance, more than 80% of the participants in the survey had logged into their bank’s site or mobile app in the past 30 days, averaging just over 11 visits each. However, 61% of the respondents said that they had also visited the branch during that same 30 day period. I thought you would like to read about some of the findings of this study.
According to the study, more than half (53%) of consumers prefer online or mobile banking for standard daily transactions, but 44% said they prefer a traditional branch. Surely some of these people would prefer to migrate their entire life to digital channels? Not so, as there would still be a significant number of customers who will still want to visit branches.
This might come as a reality check for those bankers who are racing hell for leather toward a digital-only world and decry the relevance of any brick and mortar presence, but it’s clear according to the data in study after study after study, that branches are still a critical component in the retail delivery model.
Consumers engage through both digital and traditional channels, and a mobile-only approach is going to appeal to a limited segment of consumers.
In many cases, consumers are going to branches for routine activities that could be easily accommodated in online or mobile channels. Among those in the Fiserv study who said they have visited a branch in the last month, the common reasons were to deposit cheques (68%), withdraw cash (51%) or speak to representatives (22%), while online site users most commonly went online to check balances (79%), pay bills (47%) or transfer money within the same organization (41%).
The channels through which transactions were conducted also appear to show a relationship to the consumer’s stage of life. This is highlighted by the fact that ‘Millennials’, aged 25 to 35, reported visiting a branch 4.6 times in one month – higher than any other generation and much higher than the overall average of 2.9 times. ‘Millennials’ were also more likely than any other generation to have applied for a loan (17%) or received a loan (18%) in the last year, which may factor into this higher frequency of visits.
Millennial consumers are making use of all financial channels, deciding which channel to use is often dependent on their personal needs at a particular moment in time. As life stages change, many Millennials’ life events require higher levels of engagement in their finances, and they appear to be using all the available tools at their disposal.
The study also underscored the influence of mobile technology in people’s lives. On average consumers reported having 24 apps installed on their phones, with nearly one in six (15%) having 40 or more. Two out of three consumers (66%) use five or more apps daily.
Despite their affinity for mobile apps, consumers have yet to fully adopt mobile wallets. Only 16% of people have used a mobile wallet — 20% for men and 12% for women. Millennials are the most common mobile wallet users, with 36% of younger Millennials (those ages 18 to 24) reporting that they use mobile wallets.
While this preference for apps opens up new possibilities for financial institutions, it also provides opportunities for non-financial institutions to cater to consumers. With Millennials, ages 18 to 35, and Gen Xers, ages 36 to 50, expressing more comfort than other generations using non-financial organizations for financial services, financial institutions will need to prioritize efforts to build and preserve loyalty among these segments.