Separate Your Bank from the Competition with Your Storefront
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Creating Competitive Advantage Via Your Bank Storefront Brian Warrick, Director of Product Solutions
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As banking has become a commodity, learn how providing your internet prospects and customers with innovative services will help attract, service, and retain your customer base. Powered by the Magnolia framework, see how to position your institution to provide the experience that will keep customers on your site - and off of your competition's.
Transcript of Separate Your Bank from the Competition with Your Storefront
Creating Competitive Advantage Via Your Bank Storefront
Brian Warrick, Director of Product Solutions
Storefront?
Banking Pressures
• Housing market collapse, Economic Downturn• Increased complexity in operational efficiency, security & risk
management• Evolving regulatory environment• Products are commoditized• Tighter expense & cost controls• Customers demanding higher levels of service
Current Trends
• Bank closures• 89 Banks failed in 2009 (so far…)
• Increased M&A activity• Analysts predict 50% decrease in # of US Banks over coming years
(American Banker Analyst Roundtable, 2Q2009)
• Increased pressure on IT personnel• Financial Insights forecasting first-ever negative growth in IT spending
in 2009• Small to Mid-size Bank IT staffs consumed with
application/infrastructure maintenance
• Customer Attrition increasing• Turnover rates reach 15% annually (American Banker)
...But Opportunities Abound
• Web Banking on the rise• 51% of internet enabled US households do some banking online• Only 10% of households currently perform banking transactions
• Mobile Banking to see huge growth• 50 Million users by 2013 (Tower Group)
• Switching banks is more common• Customers are looking for safe havens
Customer Engagement is Key
• Engaged customers less likely to leave for competing offer (Gallup Study)
• 37% Retention yield for engaged customers• “Extremely Satisfied” website users are 7X more likely to be engaged
with their bank• 15X for ‘Extremely Satisfied” mobile banking users
• Firms that minimize turnover will grow 30% faster (Tower Group)
• For large Banks, a 5% shift in engagement = $1 Billion (JD Power & Assoc)
Customer Engagement Best Practices
• Excellent Customer Service• Personalized, Effective, Efficient
• Easy, Multi-channel Access• Web, eMail, Chat, Phone, Branch
• Simplicity• Intuitive, Informative, No Jargon
• Promote Trust and Confidence• Security and Consistency
The Customer Lifecycle
Online Evolution
• Basic Informational• Branch locations, Product list, FAQs
• Expanded Informational• Rates, Calculators, Contact Forms
• Simple Transactional• Balances, Transfers, Payments, Loan Applications
• Enhanced Transactional• Account Origination & Funding, Real-time Loan Decisioning
• Virtual Financial Center• Personalized Financial Management, Guidance, Securities & Insurance, Chat
• ~30% of US Banks have Online Account Origination
The Multi-channel Bank
Financial System of Record(FSOR) Multi-factor Authentication
Partner Service Interfaces
Host Processors and Other Integrated Services
Customer Service Channel
Customer Internet Channels
PostGresqlMysQL
DB2Oracle
SQLServer
SOR & Partner API’s
Batch
AccessEdge
MQ
Web Services Channel Apps
Services API
Internet Portal (https)
APIAPI
Intranet Portal(https)
Storefront Portal (http)
Content Management System(CMS)
ProductEdge
Web ServicesAPI
Content Management System(CMS)
URL
SOR & Partner API’s
CustomerEdge
Services API
APIAPI
Content Management System(CMS)
SOR & Partner API’s
Services API
Web Services API
Customer Identification
Bill Pay Processing
Remote Deposit Capture
Call Center Telephony
Item Processing
Document/Output Solutions
IVR Services
IVRBrokerage,Insurance
Services Portal
SOR & Partner API’s
URL
Storefont
• First face to prospects and customers• Up to 60% of visitors browse and leave
• Primary source for Product and Service information• Personalization begins here with Customization• Content should be relevant and current• Interactive tools and features to aide decision making
• Website feature usage is positively correlated to customer engagement and satisfaction (Gallup)
Overall CMS Deployment Overview
Publish
MagnoliaRepository
ProductEdge
MagnoliaRepository
AccessEdge
MagnoliaRepository
CustomerEdge
Storefront Portal Internet Portal Intranet Portal
MagnoliaRepository
AuthorCMS
Publish Publish
1 to N 1 to N 1 to N
Master
Success Factors
• Speed to Market• Extensibility and Reusability• Reduced Expenses• Freedom from the development cycle• IT Resources unleashed• Seize opportunities
Case Study
Pre-CMS
Task Hours IT Cost Business Cost
Requirements Definition 3.78 $378.00 $226.80
Development 6.27 $627.00 $0.00
Quality Assurance 4.69 $469.00 $0.00
Customer Acceptance 0.86 $86.00 $51.60
Deployment Support 1.96 $196.00 $117.60
Totals $1,756.00 $396.00
Grand Total $2,152.00
IT Hourly Rate $100
Business Hourly Rate $60
Case Study
Post-CMSTask Hours IT Cost Business Cost
Requirements Definition 2.45 $147.00
Development 0 $0.00
Quality Assurance 0 $0.00
Customer Acceptance 0.86 $51.60
Deployment Support 0.25 $15.00
Totals $0.00 $213.60
Grand Total $213.60
IT Hourly Rate $100
Business Hourly Rate $60
29% ROI
Case Study - Benefits
• Change cycle reduced from Months to Hours
• Content shared across platforms
• Increased Business User Satisfaction
• $50 Million Deposits Realized
• ~$100K Annual Savings
• 5% Reduction in Phone calls /eMails
• $90,000 operational expense savings
Powered by Magnolia
Magnolia Experience
• Ease of use, minimal training• Scalable and performant• Reusable – content shared across channels• Feature Rich• Excellent Support
Thank You!
For additional questions or follow-up:
Brian Warrick
+1.908.256.5892
