The Customer Effect
Why banks are looking to the retail industry for ideas
- It's obvious banks need to borrow from retailers when creating mobile payments offerings, but like the rest of banking, improving the experience extends beyond the transaction
- Beyond mobile payments, banks could amp up their branch upgrades, data strategies and business model with inspiration from retail

It may be on retailers to create some movement in the mobile payments arena, but there's still a lot more finance brands can learn from retailers.
“Banks are no longer competing against one another for experience," said Reginald Jones, Samsung’s head of sales for financial services. "Are you gonna walk out of TD and then walk into Bank of America and do the same transaction? No, you just did it. Now banks are competing with every other retail experience that their customers have taken part in throughout the day, week or even month.”
The in-store retail experience is just one of a number of different ways retailers are inspiring banks to upgrade their customer offerings. It's a theme that's noticeable in banks' websites pushing content marketing and "news," in where and how banks are marketing to customers and in mobile banking apps -- as well as mobile payments apps like Chase Pay.
Here are three things banks are starting to borrow from retailers.
Branch experience
Branches and ATMs have historically acted as the most influential part of banks’ customer relationships but as digital channels are driving them apart, banks are learning how to mobilize their branch staff.
That's something retailers have had to grapple with as well. There are four things customers walk away with when they leave a big box retailer, quick service restaurant or a luxury retailer, according to Jones: whether or not they were happy with the experience, they left with what they wanted, they learned something and if they would recommend the experience to a friend. The easiest way to evolve while maintaining a closeness between the bank and the customer is by incorporating mobile devices into the branch experience.
“Any employee should be able to get up and move around the space so they can service the customers whether they’re at a work station, in a waiting area, coming through the door or even as they’re transferring them from an associate to a sales professional,” Jones said.
Taking inspiration from Apple stores, bank branches have already begun evolving into more digitally oriented spaces that incorporate new tablets and mobile phones to aid the customer experience, bringing employees closer to the customer. Citibank’s new digital branches, for example, each feature a workbench with computers where customers can look at their finances with a personal banker at their side. Staffers, equipped with iPads, are available on the floor. While banking side-by-side was once thought of as a luxury, banks are realizing that to keep up with other retail experiences, that needs to be the norm.
“Most customers today have done 80 percent to 90 percent of the research from home, so what they are really seeking is the human interaction and validation from that transaction at a branch,” Jones said. “What the customer needs today from their bank branch is a business partner. Having customers come into a branch is an opportunity for a bank to remind the customer they have the best professionals on staff.”
A platform approach
Everyone talks about being client centric, Citi Ventures’ CEO Vanessa Colella said at a recent New York conference. It is the mantra of the new world of banking. But to truly put the customer experience first, they should try to become distribution channels for different financial products — like Amazon.
A successful bank platform would be one that attracts and matches both producers and consumers. It would give people choice without friction (such as duplicate data entry, integration, having to paying multiple providers), create new revenue streams for banks and offer opportunities for fintech startups to scale.
“The platform as a business model is designed to address that problem of enabling a bank to provide products and services without having to go into different partnerships and one-to-one integrations,” according to Ron Shevlin, director of research at Cornerstone Advisors. “If you want to sell your stuff on Amazon, you sign up and you’re in. It’s easy to plug into Amazon, and that’s the concept missing in banking.”
Banks embrace the idea that they can’t do everything as well or as fast as a tech company can, that there are alternative financial applications — the savings and management apps, authentication and security tools and money movement capabilities — their customers like using and that they want to allow their customers to use them — as long as they maintain their relationship with the bank. In the last year alone, Citi, BBVA, Capital One and other major banks have opened their APIs to third party developers to innovate better and faster.
“[The] platform approach has not been an obvious approach on Wall Street,” Goldman Sachs CFO Marty Chavez said in a keynote at Harvard University earlier this year. A platform approach has been key to how an old legacy institution like Goldman was able to make a fast push into retail banking. Two years ago it acquired GE Ban; shortly after, it launched GS Bank. That year, it also built and launched Marcus, its digital-only consumer loan product, in a 12-month period.
“Our competitors are generally structured in deep vertical silos and we have a different architecture: these shallower silos built on top of many layers of software, tech infrastructure, cybersecurity, enterprise platforms and increasingly, client platforms,” Chavez said.
Monetizing data
Banks are realizing they need to become more interconnected in how they use data to bring value to customers through offers, insights and exclusive promotions based on their transactional data and activity with the banks’ digital and mobile channels.
“People don't want choices anymore,” said Roger Park, the innovation and strategy lead for EY’s financial services organization. “They want you to know them well enough to know exactly what you want and when you want it and if you can do that in a reliable, trustworthy way they will give you access to their data and their lives. That is the holy grail.”
To do that, they need to form a connected commerce vision, said Dave Kuchenski, a business development director at Diebold Nixdorf. However, many banks haven’t really mastered their omnichannel strategies — or even their mobile strategies for that matter. They often think about delivering customer experience in a segmented way; the mobile channel is separate from the website, which is further separate from the branch, and none of them really come together for customers in an integrated way.
For example, a customer looking for a mortgage should be able to do so across multiple channels, Kuchenski said. She could ask Alexa about different rates and mortgage types, move to the mobile device to submit her personal information so when she shows up at the branch to meet with a specialist, the bank knows her case ahead of time.
“My bank has just recently found out that I’m looking for a house,” said Kuchenski, adding that he never told his bank because he wanted to avoid being pushed offers he wasn’t ready for. “If banks were to figure out a way to better utilize the data and tailor ads and offers to me, I would appreciate that much more and it would probably deepen my relationship with my bank. But the fact is they didn’t know I was looking and they have a million and one ways to find out what I’m doing.”