Digital Banking Maturity 2020 - Deloitte
Transcript of Digital Banking Maturity 2020 - Deloitte
Digital Banking Maturity 2020Stockholm, Sweden
© 2021. Deloitte 22
A G E N D A
Digital Banking Maturity 2020 is the
4th edition of the largest global
benchmarking of digital retail banking
channels, answering what leaders are
doing to win in the digitalization race
DBM 2020
1. W H Y I S D I G I T A L M A T U R I T Y I M P O R T A N T ?
Customer experience is key for future profitability and growth
2. W H A T A R E D I G I T A L C H A M P I O N S D O I N G
T O S T A Y A H E A D ?
Where are digital champions ahead and where are they investing
now for the future? Which innovations are gaining traction
globally?
3. H O W T O B A L A N C E A D U A L
T R A N S F O R M A T I O N ?
The main challenge is not the what but how to balance a dual
transformation (today vs. tomorrow’s priorities)
© 2021. Deloitte 33
Digital Banking Maturity study at a glance
A B O U T D B M S T U D Y 2 0 2 0
Digital
adopters
Digital
latecomers
Digital
champions
Digital
smart followers
Spain
Belgium
Singapore
Turkey
Poland
Japan
Norway
Russia
Qatar
SA
Czech Republic
Greece
Mexico
Italy
Luxemburg
Netherlands
Portugal
SlovakiaGermany
France
Peru
Canada
Kuwait UAE
Sweden
Switzerland
United Kingdom
AustraliaArgentina
Chile
Romania
Serbia
Slovenia
Hungary
Ireland
Bulgaria
Croatia Uruguay
Colombia
1. To achieve comparable data, country averages are based on the results of the top 5 biggest banks in given market in terms of assets.
Countries within the four categories are not in order of market position – the position of the flag within the group is in alphabetical order.
4.9kcustomers
surveyed
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RELATIONSHIP
INFORMATION
GATHERING
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1.1k+functionalities benchmarked
6Swedish banks
included
318banks assessed
180+mystery shopper
researchers
39markets covered
DB
M in
dex1
Banks
© 2021. Deloitte 44
In order to compare digital maturity between banks we assessed three components
U S E R E X P E R I E N C E S T U D Y
F U N C T I O N A L I T I E S B E N C H M A R K I N G
Assessment of 6 customer
journey steps
Analysis of digitalization of
13 core banking products
Customer preferences between channels in terms of
most common banking activities
19 UX scenarios reflecting 10 areas of
customer activity from all of the stages of
relationship with a bank
Analysis of 1108 digital functionalities through ‘mystery shopper’ approach on real retail current accounts in each bank.
Survey-based research focused on identifying 26 most important banking activities and preferred channels (branch, Internet, mobile).
Supplementing analysis of customers perception of user experience.
Functionalities library with
world’s leading practicesAn exhaustive overview of
digital maturity between
banks
C U S T O M E R N E E D S R E S E A R C H
D B M
B E N C H M A R K
Assessment of digital banking
channels from customer
experience perspective
U X
A S S E S S M E N T
UEQ survey covering a comprehensive
impression of UX of mobile apps
Note: Complementary assessment comprise KPIs and Covid-19 response surveys.
WHAT ARE DIGITAL CHAMPIONS DOING TO STAY AHEAD?
© 2021. Deloitte 55
A G E N D A
1. W H Y I S D I G I T A L M A T U R I T Y I M P O R T A N T ?
Customer experience is key for future profitability and growth
2. W H A T A R E D I G I T A L C H A M P I O N S D O I N G
T O S T A Y A H E A D ?
Where are Digital champions ahead and where are they investing
now for the future? Which innovations are gaining traction
globally?
3. H O W T O B A L A N C E A D U A L
T R A N S F O R M A T I O N ?
The main challenge is not the what but how to balance a dual
transformation (today vs. tomorrow’s priorities)
© 2021. Deloitte 66
Sweden’s high degree of digitalization has countered the global declining trend in profitability, but customer satisfaction is at risk
Net interest margin in % CSI
Squeezed profits…
• Regulations becoming more
and more complex
• Technology investments
continue to rise
• Human & organizational
transformation requiring new
capabilities
… at the cost of customer
satisfaction?
Source: Deloitte 2020 banking and capital markets outlook, Economist Business Intelligence Unit, Swedish Quality Index (SKI)
WHY IS DIGITAL MATURITY IMPORTANT?
58,0
60,0
62,0
64,0
66,0
68,0
70,0
72,0
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Sweden CSI Sweden US Western Europe
© 2021. Deloitte 77
Our DBM study indicates that incumbent digital champions outperform incumbent peers in profitability metrics
1.9 p.p.
81%of Digital champions are incumbents1
Selected metrics of incumbents: average difference to incumbent peers2, p.p.
ROE
ROA
Cost/income
0.2 p.p.
-4.0 p.p.
1. Incumbents – banks with long-established position on the market. Challengers – relatively small bank competing with large long-established banks.
2. Average difference to peers – peers are incumbent banks in the same country that were covered in the DBM survey.
WHY IS DIGITAL MATURITY IMPORTANT?
© 2021. Deloitte 88
The study showed that there are no digital champions on the Swedish market, similarly to 2018 – but some banks have evolved since
WHY IS DIGITAL MATURITY IMPORTANT?
DBM index for 313 banks of 318 that participated in 2020 edition
Digital
adopters
Digital
latecomers
Digital
champions
Digital
smart followers
Sweden avg.
DB
M in
dex
Banks
© 2021. Deloitte 99
What are you experiencing as the most challenging in working towards becoming a digital champion?
WHY IS DIGITAL MATURITY IMPORTANT?
Mature digital organisations differentiate in four areas
1. MINDSETDoes senior
management sponsor and incentives change?
2. FOCUSAre you clear on your digital/omni goals and
priority within your opportunity space?
3. EXPERIMENTDo you have the right processes to “test and learn” and sufficient agility in the core to
work with e.g. startups?
4. SCALEAre governance and funding structures in
place to provide growth and speed?
© 2021. Deloitte 1010
A G E N D A
1. W H Y I S D I G I T A L M A T U R I T Y I M P O R T A N T ?
Customer experience is key for future profitability and growth
2. W H A T A R E D I G I T A L C H A M P I O N S D O I N G
T O S T A Y A H E A D ?
Where are Digital champions ahead and where are they investing
now for the future? Which innovations are gaining traction
globally?
3. H O W T O B A L A N C E A D U A L
T R A N S F O R M A T I O N ?
The main challenge is not the what but how to balance a dual
transformation (today vs. tomorrow’s priorities)
© 2021. Deloitte 1111
44%
38%
44%
2%11%
61%
67%
2. Open an
account
4. Report
lost card
1. Gather account
information
71%
23%
10. Close
an account
8. Add accounts
from other banks
3. Onboarding 7. Use beyond
banking services
7%
30%
6. Buy an
insurance
65%
54%
79%
5. Make a
transfer
75%
48%
22%
45%
38%
9. Buy a credit
product
5%
Digital champions deliver better UX across the customer journey and outperform peers in terms of expanding the customer relationship
% of UX-related functionalities offered by banks Digital latecomers Digital champions
+48p.p
+37p.p
+30p.p
WHAT ARE DIGITAL CHAMPIONS DOING TO STAY AHEAD?
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Champions are focusing investments on enabling a broader and more personal experience which gives results in advantage over peers
Authorization
Account and product mgmt.
Product x-sell (complementary)
Availability of information
Card management
Opening process
Guidance for new users
Channels accessibility
Customer support
Personal finance management (PFM)
Transfers and payments
Bancassurance
Ecosystem and account aggregation
Beyond banking
Investment services
Product x-sell (basic)
Account closing
Digital
latecomers
Digital
champions
% of functionalities offered by banks
1.8x
1.6x
1.8x
2.8x
1.9x
4.8x
1.4x
2.7x
1.7x
2.9x
3.5x
5.7x
6.2x
4.2x
2.5x
2.4x
7.1x
Champions over
latecomers1
Top three categories
1. Ratio of functionalities % between Digital champions and Digital latecomers score
2. Based on the data for 152 banks which participated in 2018 and 2020 edition
4%
8%
4%
6%
15%
5%
14%
5%
15%
10%
14%
13%
16%
10%
13%
11%
10%
Priorities in last two
years 2
WHAT ARE DIGITAL CHAMPIONS DOING TO STAY AHEAD?
Key investments
2
3
1
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© 2021. Deloitte 1313
Personal finance management: Champions have taken the next leap and are investing in x-sell boosters
47%
17%
2.9x
Measuring
financial
health
Budget
notifications
43%
Managing
transaction
categories
Setting
financial
goals
Saving and
investing
advice
Contextual
offer
Financial
projections
41%39%
21%
16% 15%13%
Engagement drivers
X-sell boosters
Digital
latecomers
Digital
champions
% of Digital champions offering given functionalities1
% of functionalities offered by banks1
Personal Finance Management
1. Data for 31 banks classified as Digital champions and 93 banks classified as Digital latecomers which participated in 2020 edition.
1
WHAT ARE DIGITAL CHAMPIONS DOING TO STAY AHEAD?
© 2021. Deloitte 1414
PFM is advancing from aggregation to insight driven actions
Poland
ING proposes
customized advice
to improve
customer’s
financial health
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© 2021. Deloitte 1515
Ecosystems start to enable more personal and data driven insights to engage customers
Spain
BBVA provides
data that allows
customers to
compare
themselves against
other profiles
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2
© 2021. Deloitte 1616
Expanding beyond traditional banking allows some players to create completely new customer offers
Singapore
DBS has integrated
payment related
non-financial
services in their
app
WHAT ARE DIGITAL CHAMPIONS DOING TO STAY AHEAD?
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GATHERING
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1Targeting
metrics
What business metrics
are targeted to
improve? And by how
much?
There are five key questions that can be discussed with leadership teams when working with CX transformation programs.
However, it isn’t in what champions are doing rather how they deliver customer value
WHAT ARE DIGITAL CHAMPIONS DOING TO STAY AHEAD? WHAT ARE DIGITAL CHAMPIONS DOING TO STAY AHEAD?
2Customer
journey
What customer
journeys matter the
most to our customers?
3Customer
journey part
What sections in these
journeys will we
improve? How do we
know that it will improve?
4Results
monitoring
5Identifying
the change
How will we know that
we have succeeded?
What metrics will we
monitor? How do we
re-course?
What specific segments
of customers will
experience the impact
first? When do we see
changes?
© 2021. Deloitte 1818
A G E N D A
1. W H Y I S D I G I T A L M A T U R I T Y I M P O R T A N T ?
Customer experience is key for future profitability and growth
2. W H A T A R E D I G I T A L C H A M P I O N S D O I N G
T O S T A Y A H E A D ?
Where are Digital champions ahead and where are they investing
now for the future? Which innovations are gaining traction
globally?
3. H O W T O B A L A N C E A D U A L
T R A N S F O R M A T I O N ?
The main challenge is not the what but how to balance a dual
transformation (today vs. tomorrow’s priorities)
© 2021. Deloitte 1919
What are you experiencing the most challenging by working towards becoming a digital champion?
WHY IS DIGITAL MATURITY IMPORTANT?
Mature digital organisations differentiate in four areas
1. MINDSETDoes senior
management sponsor and incentives change?
2. FOCUSAre you clear on your digital/omni goals and
priority opportunity space?
3. EXPERIMENTDo you have the right processes to “test and learn” and sufficient agility in the core to
work with e.g. startups?
4. SCALEAre governance and funding structures in
place to provide growth and speed?
© 2021. Deloitte 2020
Latecomers are stuck with repositioning todays challenges, meanwhile Champions are balancing todays ambiguity for tomorrows opportunity
HOW TO BALANCE A DUAL TRANSFORMATION?
AC
TRANSFORMATION B
Create tomorrow
CAPABILITIES LINK
Catalyze core assets
Finding ways in today’s
core business to maximize
resilience
TRANSFORMATION A
Reposition today
BCreating a new growth
engine outside of core
markets
© 2021. Deloitte 2121
Next time:1-on-1 sessions to deep dive in the data set
HOW TO BALANCE A DUAL TRANSFORMATION?
Compare to competition
Gain insights into the positioning of an individual bank in comparison to local and
global leaders with key gaps in our BI dashboard.
Outcome: Identification of opportunities and strategic implications based on
individual bank’s positioning versus peers.
Discuss your digital maturity & next steps for working with your CX
• Review individual performance in relation to business objectives e.g. what
business metrics are targeted to improve? And by how much?
• What customer journeys matter the most to our customers?
• What sections in these journeys will we improve? How do we know that it will
improve?
• How will we know that we have succeeded? What metrics will we monitor? How
do we re-course?
• What specific segments of customers will experience the impact first? When do
we see changes?
Digital Banking Maturity 2020
Discuss findings, conclusions and lessons learned presented in the study.
How can one consider dual transformation?
For more details, reach out to the local representative(s)
1
2
3
4
5
© 2021. Deloitte 2222
THANK YOU!
Mårten Sellgren
Partner, Financial Services
Aleksandar Petrovic
DBM SE Project Manager
Ajla Talovic
Head of Digital Innovation