Creating a unified customer experience in middle-market banking

Middle-market banks have historically employed a fragmented digital strategy to improve back-office efficiency, focusing on sales enablement and client servicing. This was coupled with a variety of offerings that still relied on in-person interaction to achieve optimal experiences for customers. In order to stay competitive, these banks are now responding to changing customer needs by working to provide product-based digital solutions that are both online and client-facing.  

Banks are using multiple online solutions and vendors for application frameworks and software. Due to the different products used to manage clients, this can leave customers feeling like they don’t have an identity within the bank—and are instead in a transactional relationship.  

Many of these product-based digital solutions aren’t connected, and banks struggle to develop a unified, seamless experience for customers due to lack of staff, budget, and overall strategic vision when compared to larger institutions. 

The banking industry has been bracing for new relationships with a wave of younger, more digitally savvy customers—and that time has arrived. One key trait of this new era of customers is that, unlike older generations, millennials don’t wait for dissatisfaction to make a move: One in five adults have switched their primary bank in the last two years, with millennials leading these defections. 

Many reported that they were satisfied with the bank they left or one they planned to leave, and customers overall are split on their satisfaction: A recent West Monroe survey (below) of 5,000 bank customers, just half (50%) graded their experience with their bank as an “A.” This indicates that satisfaction does not always translate to loyalty.

But while it may seem like leaning heavily (or almost entirely) into digital offerings is the best strategy for gaining ongoing customer loyalty, banks must acknowledge and plan for a persevering desire by a subset of customers for in-person engagement points. 

A 2021 report by American Banker found that while Gen Z and millennials vastly prefer app-based interactions, older generations still heavily rely on in-person and online channels. Surprisingly, though, the report revealed a more complex picture with equal rates of use of ATMs across generations, and 40% of Gen Z and millennials still consistently visit bank branches. 

When done well, the banking portal should act as a more personalized extension of the in-person branch, allowing customers to make appointments, chat with bankers, and look at investments. This portal provides the experience needed to maintain customer satisfaction in an industry with evolving demands. 

Banks should center their digital engagement model around a unified customer portal, which provides a digital identity for the customer and allows them to interact with the bank through web and mobile channels across multiple product areas. Designing a holistic portal as the entry point to all prospects and customers allows for future business growth by breaking away product vertical barriers and providing a consistent and recognizable bank experience to each customer. 

The urgency for banks to deploy a digital engagement model 

The pandemic accelerated the need for digital offerings and services, pushing middle-market banks that traditionally thrived on white-glove treatment for clients to create and rely on digital solutions. Needs shifted as clients got more comfortable with digitally advanced offerings—digital options that are now considered industry standard. Banks now must determine how to properly translate their white-glove service to the digital environment, which also provides an opportunity to gain control of the customer journey and how the bank’s brand is perceived. 

Many middle-market banks used the Paycheck Protection Plan (PPP) online application as their first successful entry into a digital-first product. During that period, clients valued speed and were unable to apply in person, meaning banks did not need to consider the whole customer experience. When looking at the overall digital strategy, however, the process for quickly launching the PPP application should not be emulated on a long-term basis.  

Benefits of a unified customer portal  

Serving as the digital entryway to the customer’s relationship with the bank, a unified portal allows the user a holistic view into all bank offerings. The portal also offers online support from specific locations, facilitating the in-branch experience as needed with online scheduling and chats with bankers. The personalized homepage allows the customer to see the current state of their relationship with the bank and allows them to change over to other authenticated login platforms. 

More important, this helps banks transition from an in-person oriented experience to an enhanced online presence without losing customer loyalty and satisfaction, two critical aspects of the banking relationship. For bankers, a unified portal gives them an opportunity to surface product recommendations (cross-sell/upsell opportunities) and facilitate new account openings based on the profile of the customer without needing to engage with a sales rep. Acting as a footprint across the in-person and digital relationship, the portal ultimately provides a connected, convenient experience in a digitally focused era.  

Should banks build or buy these investments? 

With any technology investment, banks will weigh whether they will see a greater return from building a custom solution or buying something readymade. Building a unified portal gives banks more control over the customer experience, but it’s a much larger, longer-term investment in both people and technology. Custom-built portals can require additional cloud infrastructure, further integration into systems and a larger team to maintain. Some middle market financial institutions struggle to hire talent like software developers to maintain custom solutions when compared to the larger banks due to smaller hiring budgets for IT. This hiring gap can make ongoing maintenance more difficult and make it slower for the platform to evolve over time.  

However, buying a platform-based solution still includes some of the same struggles, as a team of specialists is needed in the technology department to support the portal on an ongoing basis. While this can be a smaller team than full-stack software engineers, it still requires a section of the budget. However, one benefit to buying a platform-based solution is the access to existing architecture. The bank is assured that it will be using a trusted, tested platform to build its customer experience around. 

The answer whether to build or buy will vary across banks depending on products, experiences and services offered within. We recently laid out a simple prioritization approach (above) to help banks evaluate the buy or build decision, discussing the benefits and considerations and questions for choosing the right path.  

Importance of customer data to manage portals 

Customer data has historically been spread across different product-based core systems, meaning there’s no true 360-degree view of data for banks or customers. An important aspect of developing a unified portal is evaluating how to bring together data. Banks need to look at their customer mastering strategies and create a system of record for all customer data that can then provide a feed to other systems as needed and power cross-sell opportunities. Most banks will have work to do to realize this vision: West Monroe’s Be Digital Survey found that just 52% of banks say they are “very effective” at having cloud-based, data, IP, and infrastructure. 

As portals create new entry points for customers, banks will need to have processes in place to manage their data. Below are a few other considerations regarding data management: 

• Service requests: Service workflows will need to be created to fulfill incoming requests, establishing self-service capabilities and service tiers 

• Leads and opportunities: Sales teams should be prepared for intake of new product requests, assignment and ownership of opportunities, and reporting 

• Contact information: Teams must control what data is accessible and editable for customers 

Remain competitive in an ever-changing environment

In order to compete with a market that includes big banks with bigger budgets and Fintech disrupters who are digital-first, middle-market banks must provide a captivating digital engagement model for their customers. Without adapting to meet changing customer needs, these institutions will struggle to grow and survive in a competitive landscape with plenty to offer elsewhere.