DIGITAL BANKING

Nikolay SPASOV

TBI Bank Deputy Executive Director

WHAT IS DIGITAL BANKING?

Internet Banking

Mobile Banking

NEW UNDERSTANDING OF BANKING

Omni-channel Banking
2

NEW UNDERSTANDING OF BANKING

DIGITAL BANKING

INTERNET OF THINGS
(IoT)

WHAT IS INTERNET OF THINGS (IoT)?

Mobile Phones
Wearable Devices

Coffee Machine

Headphones

Fridge
Device with
ON/OFF switch

Lamps

Washing Machine
Heating Systems

SOURCE: Gartner

Alarm

Coffee Machine

Fridge

Remind me to buy milk!

Remind me to buy milk!

Reminder

Calendar
2

Message
3

Your Car
Maps
4

I am in a traffic!
Will be late with
10 min.

New Bulgarian University

6

2020

50

Taking population predictions into account,

there will be about 6.6 devices per human on the
planet

AN EXPLOSION OF CONNECTED DEVICES

2019

2018

40

2017

DEVICES

2016

Emerging sensors traffic light cameras,

parking spot sensors, entertainment & smart
utility meters are all communicating to other
machines via broadband

30

2014

Songdo, South Korea

The number of connected devices

to internet exceeds twice the
population of the planet

20

2013

2012

US National Intelligence Council recognizes

IoT on their list with six most disruptive
with expected impact till 2025

10

2015

1992

Machine-to-machine will reach 18

billion by 2022 with consumer
electronics & intelligent houses

2009

2003

Increase of connected
Equal to Sofia City
devices in 11 years
population in that time

CISCO estimates that

IoT is born in 2008-2009

0
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020

SOURCE: US National Cable & Telecommunications Association

YEARS

INTERNET OF THINGS & DIGITAL BANKING

Users

Data

INTERNET OF THINGS & DIGITAL BANKING

3
2
Banks

Bank

IoT
1

Customer X

Financial Data

Car Accident

Data

10

DIGITAL BANKING PILLARS

Digital Banking

Experience

Content

Data & Analytics

Omni-channel

11

DIGITAL BANKING PILLARS

Digital Banking

Experience

Content

Data & Analytics

Omni-channel

12

TRADITIONAL
CYCLE

Bank

Bank
Officer

awareness

information

advice

Bank

Service
& TRNX

Worth-ToMouth

becoming a
customer

servicing &
transactions

share

ONLINE

Leaflets

Presence Personali- Interactive Simplicity Convinience Feedback

zation

13

Youve got to start with the

customer experience and work back
toward the technology not the other
way around

Steve Jobs
1955 - 2011

14

CUSTOMER JOURNEY MAPPING (MORTGAGE LOAN)

CONSIDER

DISCOVER

SELECT

VERIFY

PURCHASE

COMPLETE

ACCESS OPTIONS

DEFINE REQUIREMENTS

CHOOSE WHAT TO BUY

ID & FINANCIAL CHECK

SALE NEGOTIATED

MOVE

Decide
to buy

Learn
about the
mortgage

Calculate
the budget

Property
search

Compare
mortgages

Apply for
mortgage
loan

Assessment

Just something
that will pass
quickly

The bank
officer will
handle
everything

Sign
contract &
Deal

Move

Young Couple
THINKING &
FEELING

Renting means
freedom w/o security

Buying a property is
more binding than
marriage

Visiting bank for

consultation - helpful
BANK CUSTOMER
SERVICE OFFICER
Explains products
Prepares indicative offer
Advices to select real estate
agency

BANK

TECHNOLOGY
OPPORTUNITIES

A real estate agency

will save money

Online one-stopshop preposition

Online advisory,
including real estate
offer & indicative
budget

Selecting real estate

agency comparing &
selecting property

Form filling is time consuming

& the bank should know our
details, already

The bank
needs hard
copies

BANK CUSTOMER
SERVICE OFFICER
Fills in application form &
copies ID Cards
Provides list with required
documents

BANK CREDIT
DEPARTMENT
Performs assessment of
applicants
Evaluates property
Prepares approval

Auto data gathering

from state databases
(NSSI; GRAO; BNB;
etc.) + IoT + Social

Cant this all

be online?

Assessment
Software & Decision
Engine

All parties
communicate hard

The bank
officer
kept us
updated

This took
time!

We need
to clean

BANK CUSTOMER
SERVICE OFFICER
Periodically updates the
customers over the
status of their
application

Biometrical
electronic
signatures
software

Quick & easy

Less time &
efforts
consuming 15

Customer experience is the cumulative impact of

multiple touch points over time which result in a real
relationship feeling (or lack of).
Customer experience helps you drive
value, reduce cost and build
competitive advantage

Warren Buffett
16

CUSTOMER EXPERIENCE VS. BUSINESS VALUE

How often are customer insights used
to drive decision-making around the
organization?
Almost
always
10,7%

Occasionally
37,3%

Infrequently

16%

Not at all
5,3%
SOURCE: Customer Strategist, Volume 6

Frequently
30,7

Top actions taken based on customer

experience metrics
1. Improve customer-facing operations

2. Review results across the organization

3. Improve channel interactions
4. Report results to the entire organization
5. Improve non-customer-facing
operations
6. Reward customer-facing employees
based on results
7. Reward executives based
on results
17

CUSTOMER EXPERIENCE VS. BUSINESS VALUE

What experiences are most enhanced
or modified based on customer
experience measurement?
1. Omni-channel
experience

2. Mobile
experience

3. In branch
experience

How difficult is it to colerate changes in

customer experience with changes in
business performance (revenue,
operating margins, customer lifetime
value)?
Extremely
difficult

Moderately
difficult
Somewhat
difficult
Not at all
difficult
4. Phone agent
experience
SOURCE: Customer Strategist, Volume 6

5. Web
experience

Havent
tried

32.4%
28.2%

23.9%

7.0%
8.5%
18

CUSTOMER EXPERIENCE EQUATION

The ability of an organization to
keep and grow the customers it
already has
The ability of an
organization to increase
its customer base

Customer Experience

Acquisition

The ability of an organization

to do more with less

Retention

Efficiency

GENERATE MORE
OPPORTUNITIES

INCREASE SHARE
OF WALLET

INCREASE
ROI

INCREASE BRAND
EQUITY

DRIVE LOYALTY

INCREASE
PRODUCTIVITY

INCREASE
MARKET SHARE

DRIVE ADVOCACY

DECREASE OPS
COST
19

CUSTOMER EXPERIENCE METRICS

Acquisition

Marketing Campaign
Effectiveness

Up-Sell Cross-Sell
Rate

Average Revenue
Per Customer

Products & Services

Per Interaction

Retention

Average Resolution
Time

Uptime

Channel
Accessibility

Channel Cost

Efficiency

Acquisition Cost

Retention per
Customer - Cost

First Contact
Resolution

Average Handle
Time

20

DIGITAL BANKING PILLARS

Digital Banking

Experience

Content

Data & Analytics

Omni-channel

21

CONTENT

22

Content isnt just a tactic, its a

function of your entire marketing process.
Robert Rose

23

CONTENT ORGINATION
CONSUMER &
PERSONAL LOANS
PRODUCTS
SAVING PRODUCTS

MORTGAGE &
HOUSING LOANS
PRODUCTS

INVESTMENT
PRODUCTS

FINANCIAL
SERVICES

CREDIT & DEBIT

CARDS PRODUCTS

24

HOW BANKS BECAME PUBLISHERS?

Local Financial Media:

87%
Affluent
Customers

RESEARCH

1/2 connect with PROs

1/3 PROs content
1/4 create PRO content

International Financial Media:

75%
Local
Banks

Digital Marketing Team

25

DIGITAL BANKING PILLARS

Digital Banking

Experience

Content

Data & Analytics

Omni-channel

26

27

Without data you are just

another person with opinion.

William Edwards Deming

1900 - 1993

28

RECAP

IoT Data

Financial Data

Customer Experience

Banking Content

Data Management

29

DATA MANAGEMENT TOOLS & ANALYTICS

CONSTRAINS

80%
Local Banks

Real-time
processing of data
& analytics

place customer
centricity as a top
priority

executives believe they do

not have mature
capabilities to support
their customer strategies

1 2
out of
every

TECHNOLOGY

SOURCE: SAP Banks Betting Big on Big Data and Real-Time Customer Insight

??

59%

Predictive analytics

59%

Customer Relationship
Management System

54%
30

PREDICTIVE ANALYTICS
DRIVERS FOR PREDICTIVE
ANALYTICS IN BANKING

Next best offer

Profitability
Sales/channel performance

Sentiment analysis
Social media analysis
Credit analysis
Customer profitability

Customer
Insight

Customer
Experience
Management

Virtual agent
Next best action
Relationship pricing

Channel
Execution

Business
Strategy

Product channel strategy

Risk & capital modeling

Risk & capital management

Risk adjusted pricing
Portfolio risk management
Fraud / AML

Risk
Management

Marketing

Lead generation
Customer segmentation
Campaign management

PREDICTIVE ANALYTICS is the use of data, statistical algorithms and machine-learning techniques
to identify the likelihood of future outcomes based on historical data.
SOURCE: SAS Predictive Analytics: What it is and why it matters

31

TOP 5 PREDICTIVE ANALYTICS SOLUTIONS

Predictive Analytics
SAP Predictive Analytics

PREDICTIVE
ANALYTICS

SOURCE: Gartner Advanced Analytics Quadrant 2015: Gainers, Losers

32

WHAT IS CRM ?

system allowing businesses to manage business

relationships and the data and information
associated with them.
Customer Relationship
Management

SOURCE: Salesforce Blog

33

WHAT CRM AFFECTS ?

CUSTOMER EXPERIENCE

360 degree customer view

Personalized offers
Alerts
Advisory

COMMUNITY

SALES

Product wise pipeline

Customer on-boarding (lead capture)
Real-time sales (online)

MARKETING

Campaign management
Lead distribution to branches
Campaign follow-up

Collaboration analytics
Internal collaboration
Unified employee desktop

SERVICE & SUPPORT

PRODUCT & INNOVATION

Product analytics
New product market research
Pilot product launch

Listen, engage & respond

Auto assignments to back office
SLAs and escalations
34

HOW CRM WORKS ?

Bank
Customer X
80 BGN
Electricity Bill

Customer X

Electricity Company
35

HOW CRM WORKS ?

Customer X
Account Balance
0 BGN

Bank
Customer X
80 BGN
Electricity Bill

Customer X

Electricity Company
36

HOW CRM WORKS ?

Customer X
Account Balance
0 BGN

Bank
Customer X
80 BGN
Electricity Bill

Customer X

Electricity Company
37

HOW CRM WORKS ?

Customer X
Account Balance
0 BGN

Bank
Customer X
80 BGN
Electricity Bill

Customer X

Your account balance

is 0 BGN. Do you want
100 BGN overdraft for
electricity payment?

Electricity Company
38

HOW CRM WORKS ?

Customer X
Account Balance
100 BGN

Bank
Customer X
80 BGN
Electricity Bill

Customer X

Electricity Company
39

CRM & SOCIAL EXAMPLE

Facebook

40

CRM & SOCIAL EXAMPLE

Boyko Borisov

CRM System

41

CRM & SOCIAL EXAMPLE

Facebook

42

CRM & SOCIAL EXAMPLE

Facebook

43

CRM & SOCIAL EXAMPLE

Boyko Borisov

Boyko Borisov
Male
June 13, 1959
Bankya, Bulgaria
Single
female
Friendship
Networking
G.E.R.B.
Christian
Bankya, Bulgaria

CRM System

44

CRM & SOCIAL EXAMPLE

Boyko Borisov

CRM System

45

TOP CRM SOLUTIONS

46

DIGITAL BANKING PILLARS

Digital Banking

Experience

Content

Data & Analytics

Omni-channel

47

OMNI CHANNEL BANKING

48

OMNI CHANNEL DEFINITION

OMNI-CHANNEL BANKING is about ensuring customers have a consistent experience of the bank
products and services irrespective of the channel they use, as well as ensuring channel integration and
seamless customer transition between channels.
SINGLE
CHANNEL

Customer

Branch
Customer and bank have a
single touch point

MULTI CHANNEL

Customer

Branch

Web

Customer sees brand through

multiple touch points with bank
using siloed communications

SOURCE: A Market Leader in Ovum's Decision Matrix Digital Banking Trends in 2014 Webinar Recap

Branch

CROSS CHANNEL

OMNI CHANNEL

Customer

Customer

Web

Call

Customer sees unified brand

through many touch points.
Bank has single customer view

Branch

Web

Call

Mob

Customer has holistic brand

experience. Bank leverages
unified view of customer
49

OMNI-CHANNEL ENVIRONMENT

Branch

Online Banking

Mobile Banking
CRM

Lending Platform

Corporate Website

Social

Customer

Call Center

ATM 50

Online and physical branches

are complementary, not rivals.
They must unite together to
increase turnover which is the key
to a successful omni-channel
strategy..

Marc Benioff

51

BRANCH IN OMNI CHANNEL

52

BRANCH IN OMNI CHANNEL

53

BRANCH IN OMNI CHANNEL

54

BRANCH IN OMNI CHANNEL

55

BRANCH IN OMNI CHANNEL

56

BRANCH IN OMNI CHANNEL

57

BRANCH IN OMNI CHANNEL

58

BRANCH IN OMNI CHANNEL

59

BRANCH IN OMNI CHANNEL

60

BRANCH IN OMNI CHANNEL

61

BRANCH IN OMNI CHANNEL

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63

CONCLUSION
As customers become increasingly comfortable with technology, they are
interacting with banks in multiple ways. They expect to be treated as
individuals and according to their preferences. For banks, the time is now
to take advantage of the wealth of customer information available. As the
world becomes even more digital, capitalizing on technology will make the
difference digital banks are here.

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