The term “digital native” refers to a person who has grown up surrounded by digital technology and considers it an essential part of daily life. The term was coined in 2001 by the American writer Marc Prensky to describe a generation of people who primarily learn, communicate, and interact with the world through the internet and other modern information technologies.
As more digital natives come of age, it will become increasingly lucrative for businesses to pay attention to the ways these young people’s needs, expectations, and perspectives reshape markets across the world. Over the last few years, the banking industry has been feeling especial pressure to revamp legacy systems and procedures in line with customer demands for greater digitization. Banks’ younger and more digitally literate clients now expect higher levels of operational efficiency, flexibility, connectivity, and personalization than clients from previous generations.
In response, many banks have adopted an agenda of digital banking transformation that seeks to upgrade incumbent systems by incorporating innovative new technologies into them. Banks seeking to attract and retain more digital native customers would do well to incorporate the following steps into their business strategies:
Enhance Operational Efficiency
Analyses of digital natives’ buying behavior and of the service providers they tend to patronize reveal that these individuals highly value convenience and efficiency. When choosing a bank, digital natives are likely to look for fast and frictionless onboarding procedures, transactions, product rollouts, and other essential processes.
Banks can meet these demands by leveraging software solutions that automate basic financial processes and streamline workflows. Widespread process automation will, in turn, boost operational efficiency, enabling banks to serve more customers and process more transactions daily.
Process automation also lets banks focus more of their resources and personnel on more complex activities such as customer service, business forecasting, and the development of new products and services. This allows them to address yet another common demand of digital natives: a more varied and innovative array of digital banking products. With the appropriate technological infrastructure in place, banks can develop, market, and sell new creations at an enterprise scale in a relatively short amount of time.
Choose Scalable Software Solutions
In recent years, banks have faced rising pressure to serve more customers with less downtime, often across multiple locations and involving different currencies. Banks will also need to comply with evolving standards and regulatory requirements in different jurisdictions, making the already challenging endeavor of scaling up their services even more difficult.
The widespread demand for greater speed, efficiency, and convenience that banks face today makes the employment of scalable and agile systems a must. Many banks have found success by adopting cloud-based solutions to expedite interdepartmental collaboration, data management, and transaction processing by a large margin. Furthermore, cloud-based systems are fast and simple to set up and only require a relatively small upfront investment. This allows banks to reap the benefits of this innovative technology right out of the box.
Personalize Customer Support and Engagement
It’s a mistaken notion to assume that digital natives prioritize convenience over every other aspect of the customer experience. On the contrary, many younger banking customers also value the human element of communicating with service providers.
Indeed, these customers appreciate highly engaging and personalized customer service. Given this, retail banks can better serve digital natives by offering omnichannel customer assistance that allows clients to contact them through the platforms of their choice.
Useful communication platforms to utilize for customer service purposes include instant messaging, voice or video chat, and email. It may also be advantageous to explore artificial intelligence tools such as chatbots and machine learning, as these can support self-service transactions. Bank employees will then have the freedom to concentrate on more complicated customer service cases that absolutely require human intervention.
Prioritize Cybersecurity
Customers naturally look for financial services providers that can be trusted to protect their hard-earned money and information from internal and external sources of risk. This concern for security is especially pressing for digital natives, most of whom are well aware of the dangers of cybercrime, corporate data breaches, and other cybersecurity incidents.
To alleviate customers’ anxieties and secure their trust, financial institutions should invest in digital software with the best privacy and safety features available. An effective digital retail banking operation must incorporate security features such as granular user permissions management, identity authentication, entitlements, high-level encryption, and other related capabilities. The ability to integrate open-source security tools into existing systems is likewise helpful for boosting a bank’s overall security in digital spaces.
Explore Avenues for Integration and Collaboration
Digital natives are unlikely to depend on any one firm for all their financial needs. On the contrary, they are usually more inclined to experiment with a range of service providers. Such customers also appreciate high degrees of connectivity among the various platforms they use to conduct their financial activities. Banks looking to succeed in the digital age must thus find ways to integrate well within digital ecosystems and establish solid connections to partner organizations.
More concretely, banks can benefit from working closely with online payment platforms, e-commerce marketplaces, digital wallets, and other similar service providers. Offering secure and well-connected services will only improve customer satisfaction with both the bank and their third-party provider, ultimately leading to greater client retention for both organizations.
As new generations of customers enter the market, financial institutions can expect market demands and consumer expectations to evolve significantly. Fortunately, adopting modern digital banking solutions can help traditional banks adapt to these changes and cement their places in their customers’ lives.