UK retail banks' multi-channel ambitions will flounder without a core Web service that offers transactions, financial management and advice, according to a new report from Forrester Research.
For the research, the North American company spoke with 25 vendor firms and 30 UK retail banks and building societies. The report, "Streamlining Multi-Channel Banking", advises that financial firms must restructure their channel management around the PC, with other access points - including branches - taking a supporting role.
Forrester analyst Charlotte Hamilton, says: "Few firms today offer services beyond basic functionality like transfers and bill payments. Banks haven't expanded into third-party products and don't attract customers with aggregation across accounts or decision support."
The report shows UK banks are rushing to launch services on both handheld devices and iDTV. Forrester suggests that mobiles don't match the PC/Web for online banking, and believes most firms will find that platform costs make iDTV banking prohibitively expensive.
Forrester advises that while WAP adds little value today for banking, firms should nonetheless explore the core functions of portability, messaging and telephone services, and offer simple callbacks by telephone, build loyalty through timely messages and enable location-based information with WAP. Larger firms that offer iDTV banking should focus efforts on customers who are not online, says Forrester.
The report predicts in 2005 PC services will dominate UK retail banking, offering customers financial management and advice alongside electronic transactions. The research advises banks to adopt the PC as a core strategic channel, with both the telephone and branch networks supporting the online service. In this vision of the future, the branch becomes a meeting place where customers discuss their finances with advisory staff as kiosks take transactions away from branch cashiers.
According to Hamilton, as banks seek customer migration online, traditional channel management must evolve to support customer relationships based on the PC. Firms must align their existing channel management with new managers for transactions, personal finance management (PFM) and advice. "These new roles demand that channel managers support customer migration online for better service," she says.