The rise of digital and automated channels

A major UK retail bank wanted to migrate customers’ day-to-day banking from expensive offline channels to more convenient and cost effective online channels. This would enable the bank to save costs and increase customer satisfaction simultaneously, with satisfaction on average being higher for digital customers.

Creative processes to direct customers online

We used transaction level behavioural data to carry out economic analysis of online and offline processes and identified behavioural patterns and cost savings to target.

This was combined with behavioural research (using psychological interview techniques conducted by Phil Graves) to understand barriers to using automated banking.

Through the creative process we developed 150 ideas jointly with the client teams on how to migrate demand. We also advised the bank through the process of testing 20 priority ideas.

Getting to the heart of customer behaviour

Unconscious drivers of behaviour were very different from what customers had reported in standard survey research. For example, customers had stated that they were concerned with security online, but behavioural research revealed the bigger driver was loss aversion (i.e. the fear of making a mistake).

Demographic customer profiling did not match behaviours. For example, there was a significant share of older customers who were happy to use digital channels (e.g. as they were already shopping at Amazon). This was different to what the bank’s own research had found and changed how they approached the issue.

After a testing phase, the bank rolled out about a dozen ideas and tracked cost savings over £150m.