Inside USAA Bank’s digital experience playbook

Banks have begun the long, slow journey towards true customer-centric banking. It’s not like they have much choice. With commercial brands upping the ante on customer-centric moves, customers have come to expect the same from their financial service provider.

And because over 75 percent of millennials are willing to switch banks if they find a better alternative, banks that want to retain millennial customers, let alone acquire new ones, need to move from an organization-centric model to a customer-centric one. Preferably yesterday. The writing has been on the wall for years. Back in 2012, McKinsey warned that the future belongs to banks that put customers center stage in their business model.

Part of the push towards consumer-centric banking came from the bottom up. As a 2011 PWC report notes, mobile technology and social media have had a major impact on customer expectations and word-of-mouth marketing in the finance industry.

At USAA Federal Savings Bank, which serves active military members, veterans and their families, the process was reversed. Instead of digital serving as the catalyst for consumer-centric banking, the bank’s member-centric banking charter - much like that of a credit union - drives the firm's digital experience strategy.

So while USAA is keeping an eye on certain prevailing fintech trends, like payments innovation, personalization and the rise of human-centered design, its digital experience roadmap is focused on solving customers’ needs and helping them become financially secure.

“As we evolve our digital experiences for the future, we’ve begun considering the idea of a distributed model for the digital experience," said Melissa Ehresman, USAA’s AVP of bank digital experiences. "It will be less about a website or a mobile app as a destination and more about being where our members are and integrating with the technology around them, such as IoT and virtual assistants."

The bank debuted its mobile virtual assistant app in 2013, and released a version of its online site in September 2016. The virtual agent is currently targeting infrequent digital users that need assistance with self service and those seeking a live agent. So far, member response has been good, with 800,000 members per month engaging with the virtual assistant. It's been good for the bank, too. 70 percent of the members that interact with the tool don't need to escalate to a live representative.

"We recognize the member desire to interact in different modalities, including tap, text, and speech," Ehresman explained, noting that USAA has big plans for the virtual assistant. New technologies should enable the virtual assistant to learn member sentiment, and the bank hopes to expand adoption into more complicated or stressful tasks, like filing for insurance.

For USAA, the perfect digital experience is a three-shrimp cocktail: anticipating member needs with data, being proactive in communications with members, and ensuring the entire experience is simple and intuitive. The communication segment is particularly challenging, since USAA’s members are service members stationed across the globe.

But it is this geographical difficulty that has encouraged the bank to be a digital pioneer. "Since the military community moves more often than the average consumer, USAA found a way to move with them," says Ehresman. The bank’s mobile app and website were created to address its military members’ financial needs, regardless of where they’re located or what time it is. For instance, the digital virtual assistant connects members to live service representatives, reducing the traditional IVR system's number of  misrouted calls.

All of these innovations are a result of the bank's investment in stable and scalable back-end infrastructure. By reinforcing the bank’s infrastructure and modernizing its technology architecture, USAA has been able to develop and implement front-end user experiences more fluidly.

While its members may be constantly on the move, the goal of all of USAA’s digital innovation remains the same: take care of its members.