Welcome!

News Feed Item

Who's the Digital Native? In Banking, It's Not Millennials, Who Call Their Bank More Than Twice as Often as Boomers

Bain & Company's new retail banking research finds that seniors are eager to use digital, but receive little guidance from banks to get comfortable with the technology -- a risky oversight that could cost banks $70 million to $80 million in savings

NEW YORK, NY--(Marketwired - December 01, 2016) - Who is more likely to contact their bank's call center - Millennials or Boomers? The answer is surprising. Bain & Company's new report, Bank Branch/Call Center Traffic Jam: Why do customers keep visiting tellers and calling the contact center?, reveals that while mobile adoption is high at 82 percent among Millennials, 86 percent still visited a teller in the last three months and 60 percent called the contact center. Among those 55 and older, only 42 percent contacted their bank via phone. Younger customer also call more frequently: on average, they called their bank 1.4 times over a three month period, while older customers called only 0.5 times.

Among older consumers that use mobile banking, nearly half say they like the experience, versus about 40 percent of those 18-34. Clearly, they embrace mobile technology once they try it, but few receive much-needed guidance and information about using their bank's mobile apps. This situation creates an untapped opportunity for banks that understand how to reach both ends of the generation spectrum -- and everyone in between. Yet, some banks are still missing the mark, putting $70 million to $80 million of potential savings at risk for a typical U.S. bank with 1,000 branches.

"It's well known by now that digital self-service is much more cost-effective for banks -- about one-tenth the cost of a teller visit or live phone call," said Gerard du Toit, head of Bain's Banking Practice and lead author of the report. "Even with that knowledge, and despite the increasing power and presence of mobile, U.S. banks have a long way to go to realize the promise of digital self-service."

According to Bain's survey of 5,300 U.S. banking consumers, Millennials are typically much more familiar with digital and mobile technology. However, they are still on the banking learning curve. Bill paying, depositing checks, transferring money and resolving issues with their accounts are new terrain -- both online and off. As a result, they report that digital channels are confusing or inadequate for their banking, and they often need help. Among the heaviest teller users, for instance, 42 percent of the younger ones tried using another channel before visiting the branch.

Boomers on the other hand have deep banking experience, but they are often less familiar with digital technology and need additional support grow comfortable with self-banking. Bain found that half of older customers still use tellers through force of habit, and 75 percent of these visits are for routine interactions that can be done more quickly and efficiently by self-service. Yet, only a mere 17 percent of older respondents said they have received any guidance or training on how to use their bank's mobile app, compared to 26 percent of young respondents. Consequently, this group is less than half as likely as younger consumers to use mobile apps or mobile browsers to do their banking.

"Banks are missing a major opportunity to teach young consumers to bank and older consumers to self-bank," said du Toit. "Boomers in particular are ripe for mobile conversion. They just lack support and help from their banks to make the leap. Perhaps banks assume seniors are not interested or have decided that providing guidance is too much trouble, but they need to overcome their 'unconscious ageism' if they want to survive the mobile disruption."

Migrating customers -- regardless of age -- to digital as well as better serving them through online and mobile tools could reduce the routine transactions that add costly volume in branches and call centers. Almost three-quarters of reported branch transactions and more than half of phone interactions deal with deposits, withdrawals, checking one's account and other routine matters that could be better handled through self-banking at less expense to banks.

Tackling barriers to digital adoption among the young and the old can be daunting, but the payoff is swift and significant. Bain's study analyzes how some banks are spurring behavior change in their customers:

  • Devise interventions by front-line branch and service center representatives that blend education and encouragement: For example, not "why don't you use your phone?" but "would you like to see how you could save time?"
  • Invite customers to try digital banking with the guidance of a trusted employee they know or have worked with. At one major North American bank, this approach achieved a 70 percent conversion rate for future interactions.
  • Use Agile techniques to tackle the root causes of routine branch visits and phone calls. Banks taking this approach have been able to reduce branch and call center volumes by 20 percent in 12 months.

Banks that design an easy, accessible and convenient self-service experience stand a better chance of creating loyal customers - Millennials and Boomers alike.

For a copy of the report or to schedule an interview with Mr. du Toit, please contact Dan Pinkney at [email protected] or +1 646 562 8102.

About Bain & Company

Bain & Company is the management consulting firm that the world's business leaders come to when they want results. Bain advises clients on strategy, operations, technology, organization, private equity and mergers and acquisition, developing practical insights that clients act on and transferring skills that make change stick. The firm aligns its incentives with clients by linking its fees to their results. Bain clients have outperformed the stock market 4 to 1. Founded in 1973, Bain has 53 offices in 34 countries, and its deep expertise and client roster cross every industry and economic sector. For more information visit: www.bain.com. Follow us on Twitter @BainAlerts.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
SYS-CON Events announced today that TMC has been named “Media Sponsor” of SYS-CON's 21st International Cloud Expo and Big Data at Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Global buyers rely on TMC’s content-driven marketplaces to make purchase decisions and navigate markets. Learn how we can help you reach your marketing goals.
Amazon started as an online bookseller 20 years ago. Since then, it has evolved into a technology juggernaut that has disrupted multiple markets and industries and touches many aspects of our lives. It is a relentless technology and business model innovator driving disruption throughout numerous ecosystems. Amazon’s AWS revenues alone are approaching $16B a year making it one of the largest IT companies in the world. With dominant offerings in Cloud, IoT, eCommerce, Big Data, AI, Digital Assista...
SYS-CON Events announced today that TechTarget has been named “Media Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. TechTarget storage websites are the best online information resource for news, tips and expert advice for the storage, backup and disaster recovery markets.
We build IoT infrastructure products - when you have to integrate different devices, different systems and cloud you have to build an application to do that but we eliminate the need to build an application. Our products can integrate any device, any system, any cloud regardless of protocol," explained Peter Jung, Chief Product Officer at Pulzze Systems, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA
SYS-CON Events announced today that IBM has been named “Diamond Sponsor” of SYS-CON's 21st Cloud Expo, which will take place on October 31 through November 2nd 2017 at the Santa Clara Convention Center in Santa Clara, California.
SYS-CON Events announced today that Conference Guru has been named “Media Sponsor” of SYS-CON's 21st International Cloud Expo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. A valuable conference experience generates new contacts, sales leads, potential strategic partners and potential investors; helps gather competitive intelligence and even provides inspiration for new products and services. Conference Guru works with conference organi...
Managing mission-critical SAP systems and landscapes has never been easy. Add public cloud with its myriad of powerful cloud native services and this may not change any time soon. Public cloud offers exciting new possibilities for enterprise workloads. But to make use of these possibilities and capabilities, IT teams need to re-think everything they have done before. Otherwise, they will just end up using public cloud as a hosting platform for their workloads, aka known as “lift and shift.”
Multiple data types are pouring into IoT deployments. Data is coming in small packages as well as enormous files and data streams of many sizes. Widespread use of mobile devices adds to the total. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists looked at the tools and environments that are being put to use in IoT deployments, as well as the team skills a modern enterprise IT shop needs to keep things running, get a handle on all this data, and deliver...
SYS-CON Events announced today that Enzu will exhibit at SYS-CON's 21st Int\ernational Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to focus on the core of their ...
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
"Tintri focuses on the Ops side of the DevOps, which basically is pushing more and more of the accessibility of the infrastructure to the developers and trying to get behind the scenes," explained Dhiraj Sehgal of Tintri in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.
You know you need the cloud, but you’re hesitant to simply dump everything at Amazon since you know that not all workloads are suitable for cloud. You know that you want the kind of ease of use and scalability that you get with public cloud, but your applications are architected in a way that makes the public cloud a non-starter. You’re looking at private cloud solutions based on hyperconverged infrastructure, but you’re concerned with the limits inherent in those technologies.
Both SaaS vendors and SaaS buyers are going “all-in” to hyperscale IaaS platforms such as AWS, which is disrupting the SaaS value proposition. Why should the enterprise SaaS consumer pay for the SaaS service if their data is resident in adjacent AWS S3 buckets? If both SaaS sellers and buyers are using the same cloud tools, automation and pay-per-transaction model offered by IaaS platforms, then why not host the “shrink-wrapped” software in the customers’ cloud? Further, serverless computing, cl...
Automation is enabling enterprises to design, deploy, and manage more complex, hybrid cloud environments. Yet the people who manage these environments must be trained in and understanding these environments better than ever before. A new era of analytics and cognitive computing is adding intelligence, but also more complexity, to these cloud environments. How smart is your cloud? How smart should it be? In this power panel at 20th Cloud Expo, moderated by Conference Chair Roger Strukhoff, paneli...
In his session at @ThingsExpo, Eric Lachapelle, CEO of the Professional Evaluation and Certification Board (PECB), provided an overview of various initiatives to certify the security of connected devices and future trends in ensuring public trust of IoT. Eric Lachapelle is the Chief Executive Officer of the Professional Evaluation and Certification Board (PECB), an international certification body. His role is to help companies and individuals to achieve professional, accredited and worldwide re...