Digital Channel Evolution, Member Loyalty, and Forgotten Generations
There was a time when online banking was all the rage. The first iteration of the online banking space was in 1997. Back then, the internet was just getting started, and online banking was financial institutions' entrance into the digital channel. Fast forward 22 years and the digital landscape has forever changed with the creation of the mobile app. Today consumers have their mobile device with them everywhere they go.
A recent article in the Credit Union Times stated that "application loyalty is the new brand loyalty as consumers demand a flawless digital customer experience," according to a new study examining consumers' reliance on applications and services. The article goes on further to state that "consumers choose retailers according to how quickly they can get access to a product or service without visiting a store (63%), and they pick their bank based on the ability to perform all transactions digitally." Brands that excel at the digital channel will increase existing consumer loyalty and are more likely to attract new consumers through the most trusted form of marketing...word of mouth.
It is important to note that online banking remains a strong presence in the digital ecosystem. While mobile gets most of the focus due to the plethora of fintech companies that are dedicated to that channel, the online channel is still the preferred method for many digital banking users. As of June 2019, Bank of America has 27 million mobile users and 10 million online banking customers who do not use the mobile app. In many of the trade magazine articles, millennials get the focus as the generation that will become the new credit union members, but existing credit union members in older generational groups still need to be a focus as they bring the lion's share of the deposits and loans to credit unions.
This article was originally written before COVID. Think about what we know now. When it comes to digital banking, there is no longer a "generation gap."