Branch versus digital and the account opening battleground

Recent research of bank account opening scrutinised the sales conversion rates for branches versus online channels and found what looks like a huge gulf in success.

Findings suggest in-branch sales converted at a rate of 85 per cent, while digital channels averaged a 15 per cent conversion rate. At first glance, it looks like the branch is king, while digital channels have a lot of catching up to do.

But unsurprisingly, the real answer is not quite as simple as that.


In a branch, clearly any bank or financial services organisation has the advantage of direct face-to-face contact with individuals. As a result, personal attention leaves consumers feeling more valued and understood than they might otherwise online, appointments often convert to sales.
In fact, the 15% listed as a failed sale is often down to applications declined by the bank for identity and fraud reasons.

But it’s also important to note that the 85 per cent success rate is based on customers entering the branch – usually as a result of an out-bound sales call.

It’s also worth noting that many banks rarely contact customers at critical points in their lives when there may be a genuine need for a meeting with an adviser. Events could be anything from retirement, to a bereavement, stolen identity, or even something as straightforward as a mislaid wallet.

Instead of using insight or data to identify these critical moments, branches rely on contact frequency and customer availability to answer calls as key drivers for sales.

To improve branch sales and ensure a high conversion rate for initial outbound calls, using data to better identify when customers need help, support and guidance during consumers’ critical or life-changing points, could actually see branch sales increasing as contact is made in a more timely and relevant manner.

Significantly, branches typically still account for at least 60 per cent of all new product sales. While the mix will change, it is likely to remain the prominent sales channel for some years to come, providing greater emphasis is put on better understanding customer needs.

Online banks face different customer challenges altogether. It’s essential to provide online customers with a simple and engaging digital journey that helps them get to the end of the application before they get bored or distracted and log-off. The consequences of not doing this are unopened bank accounts and more effort and resources being directed to recover the sales opportunity.

It usually requires outbound calling, posting of documents or even asking a customer to visit a branch to complete the transaction. For most customers who opt to apply for something online, quite often because they might not have time to visit a branch, this additional effort will be too much and they are likely to not progress with the application. It might also lead to the customer feeling like the bank does not value or understand their personal preferences when it comes to completing an application online.

The big issue with digital account opening is that for many organisations, the benefits of new thinking and analysis may well be hamstrung by legacy systems. Potential problems are numerous with issues arising from any part of the account opening process.

Online journeys typically lose 35 per cent of users because they cannot identify the customer. A further 35 per cent give up at some point during the journey because it proves too difficult, with approximately 15 per cent failing the process altogether. The remaining 15 per cent make it through to open an account.

The question for banks in 2015 is how much they are willing to invest in streamlining the sales process both in branch and online rather than which to focus on the most?

Last year saw a number of customer-focussed challenger banks emerge, unbound by dated legacy systems and eager to get their share of the market. While they have yet to make a serious dent, the threat of challengers will only increase and established organisations must revive their account opening processes to keep a steady pipeline of new business.

Key to this will always be demonstrating that a customer is valued and understood. To read more around this area, or read more of Derek’s blogs, please click here.