Your customers' preferences were bound to change, are you ready for them?
Published June 14, 2021
New realities shaped by the pandemic have resulted in consumers adopting new behaviors and preferences, which has a direct implication for banking in a post-COVID world.
Here’s an example: It’s 5 p.m. on a weekday and you’re starting to think about what to eat for dinner. But the idea of stopping at the grocery store doesn’t sound appealing—especially given the potential risks associated with in-person shopping. So, what do you do?
If you’re like an increasing number of consumers around the world, you use a digital channel to ‘order ahead’ whether from a grocer or a restaurant.
This shift to the convenience of order-ahead and digital is opening the door for shoppers to try new brands and businesses for their common purchases. It’s creating not just an opportunity to attract new customers, but also increases the chance of retaining existing customers, too.
Related: Digital first or customer first? The future of brick-and-mortar is both
France: 58% of French consumers have now tried new shopping behaviors such as new places to shop, new websites or brands, and methods such as in-store pick-up and self-checkout. Of those, approximately 70% intend to continue the new habit beyond the crisis.
Older adults adopting digital-first behavior
Baby boomers and seniors are often viewed as hold-outs to these new digital experiences, preferring to shop in person whenever possible.
But a recent National Restaurant Association survey of adults who ordered takeout or delivery found the biggest increase in adoption was among baby boomers, age 56–74, who increased their use from 41 percent in February 2020 to 60 percent in late October 2020.
And for banking, we can expect to see older generations increasingly forego the branch and tellers for the convenience and safety of digital and self-service.
US: Older Americans are increasingly buying groceries—and just about everything else—on the internet, and those over 65 are now the fastest-growing category of e-commerce shoppers.
High-net households to drive digital first behavior
A survey by the National Restaurant Association asked how likely consumers are to continue using takeout over the next three months. The highest positive response was among households with $100,000 or more in annual income with 57 percent saying they’ll use take-out more frequently.
Financial institutions (FIs) often feel high-net-worth households are expecting to be served in-person, but these results indicate that, for common transactions, high-net-worth household customers appreciate the convenience of order-ahead and digital transactions as much as—or more than—others.
Related: How financial institutions are accelerating the journey to digital-first banking
India: The vast majority of Indian consumers have tried new shopping behaviors and digital habits during the crisis and report a high intent to continue.
Video interaction becoming common
Another key shift is the increasing use of video in transactions between consumers and businesses, and banking is leading the way.
In the UK, for example, Nationwide reported 15,000 video banking interactions per week in January 2021 from fewer than 100 in January of 2020! And Bank of America reported over 100,000 Webex meetings hosted by advisors, a seven-fold increase from the prior year.
And our NCR customers have reported sharp increases in the use of ATM video tellers for financial transactions that have traditionally required a trip to the branch.
All the changing preferences point to digital-first
One of the end results of these changes is that it’s clear that consumers like and will continue to demand digital-first experiences. According to a recent McKinsey survey, 85 percent of first-time digital users are satisfied or very satisfied and 75 percent plan to continue using digital post-COVID. So, it’s never been more important for financial institutions to accelerate their digital strategies and continue to transform their branches through digital-first self-service and assisted service experiences.
