ONLINE BANKING - A KEY CUSTOMER ACQUISITION AND INTEGRATION CHANNEL

Online Banking has been with us for years, yet customer acceptance of this channel as a full service banking outlet has lagged bank expectations. The online channel failed to displace bankers either in the branches or on the phone. At the same time, the majority of customers have not transitioned their purchasing of core bank products to the online channel. Those who do, generally buy high-rate depository products and adverse selection home equity loans.

Online is emerging as a key customer acquisition channel, but not in the traditional sense. The great majority of customers check prospective banks online before they approach the branch. They extensively research the offering of financial institutions through the web, much like they do for other retail products. Surprisingly, prospects of all games and economic strata use the internet to research their purchases, and then follow with in-person account openings.

Given this fact, the "face" of your bank is increasingly becoming the website, not the branch. The first impression a prospect gets of your company is through the internet. In an in-person interview, what you wear is of paramount importance. Similarly, what your website looks like is your first introduction to most of your prospects. They form an immediate impression, and then proceed to click off your site or research further. As a result, your website's look and feel, as well as functionality, are becoming critical customer acquisition elements, whether you can fulfill online or not.

Many banks give up on this issue since they know they can't compete with the giants on website functionality and sophistication. Others give up because they feel they are held captive by their vendors, who offer little flexibility. Notwithstanding, the opportunity still exists for you to make your website your own.

As you consider whether to further invest in your website, below are some suggestions for elements to focus on:

Make it simple. Navigating your website might seem simple to you, but to many of your customers and prospects, particularly those born before 1975, it can be challenging. Regulatory requirements and multi-factor authentication further encumber the uninitiated site navigator. Spend time thinking through how intuitive your site is. Consider how Apple has done it with the iPhone and iTouch, both of which are used extensively by older, non-techie people. I know your bank isn't Apple and doesn't have the resources this amazing company does, but you do have users that resemble your prospects, and IT professionals who can help.

Make it interesting. Websites need to grab the navigator's attention without being too cluttered or confusing. Being clear about the main "look and feel" you want to project, and finding interesting design elements to support that (those elements should be consistent with the rest of your marketing message and look), are two important steps forward.

Don't trivialize the customer's money. It's a fine balance between making the site interesting and fun, and making light of the serious responsibility your bank takes when you protect and manage your customers' money. Banks have typically erred on the side of making the site too somber and serious, but going too far the other way doesn't work either.

Be original. Bank web sites are too similar. They lack uniqueness, interesting colors, their own "look". Designing a site that clearly reflects who you are will help you separate yourself from the crowd and reinforce the message you send your prospects through other channels about the kind of bank you are and want to be.

Provide content. Create value for your customers on your website. Providing relevant content, especially in an interesting way, is a winning formula. Your main customer segments could gain knowledge about their financial opportunities as well as their industries from your website. Give them content theyll come back for.

NOTE: Such content doesn't have to be produced in-house, but it does need to be original.

Separate look and feel from functionality. Many times banks slow down their website development because they can't offer the full functionality they'd like to provide customers, such as online account openings, calculators etc. Your look conveys subtle and tacit messages to your customers and prospects. Ensuring that the look and feel of your site, including colors, pictures, font etc., project the image you'd like to convey, is your first order of business. Functionality is very important as well, but might take longer to implement and, occasionally, cannot be achieved altogether.

Start now - don't wait. Every day that passes by, your prospects are checking your website and selecting the bank to which they will switch. Your opportunity costs for waiting are high. Get what you can get done now, and continue improving in time.

Offer human contact alternatives. One key differentiator SuperCommunity Banks can offer is the human touch, a service level that is truly above the competition. You can grow old trying to connect with a live person, either online or by phone, off many websites. Providing human support on either channel, especially phone, without interminably long wait-times, can, in itself, fulfill your service promise and offer tangible differentiation against the competition.

Simplify access and password handling. Password setting can be, and often is, an annoying process. Sometime it's even an impediment to sign-on. Make the process as easy as possible to eliminate another hurdle your customers and prospects have to cross before they can access their data.

I'm an industry observer that rarely suggests to be ahead of the curve on the technology dimension for community banks. Paying attention to your web presence is no longer cutting edge. It isn't even par for the course. It is a necessity and a pre-condition to successful customer acquisition in the future.