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Posted by Brad Strothkamp on May 24, 2012
With all the focus and hype around mobile and payments, one major trend surfaced that has as much impact on financial service companies as anything mobile. In 2011 for the first time, consumers who opened financial products opened more of those products through digital channels (online and mobile) then they opened in a branch.
Every year, Forrester surveys North American consumers and asks them about the products they purchased/opened in the previous 12 months and the channels they used to research and apply for the those products. In 2011 across products including checking, credit cards, mortgages, insurance and investments, 37% of US online adults that opened a product opened that product online with another 2% that opened via mobile. This compares with 36% who applied in a branch. These percentages are up significantly from 2010 where 32% applied online and 40% in a branch. The percentages for Canada are less for digital, but we expect those numbers to continue in the digital direction with the focus Canadian banks are putting on digital sales.
So why the big move? In general more products were opened in 2011. In the US in 2011, 38% of online adults opened a product versus 32% in 2010. Other reasons for the move in digital sales include:
This major trend shift further highlights the need to focus on online sales or risk revenues in the future. Many retail banks are headed in that direction. In a survey Forrester recently conducted with the Consumer Bankers Association around digital priorities, digital executives reported that online sales is the biggest investment priority for the digital team as well as the biggest area of hiring. As these teams evolve, there are a few things they need to keep in mind:
I'd like to hear your thoughts.