Banks have for some time now existed in what Tower Group refers to as a ‘multi-channel world’. What this means is that they are driving at delivering a consistent experience for their customers across the variety of interactions or touch points they have with them. To be a customer of a retail bank in the UK, for instance, can mean going to a branch to pay in a cheque, talking to a call centre operative, or checking your balance and paying bills online.

Non-branch electronic channels are experiencing growth, driven by increased customer trust in transacting over the Internet, access to more ways of connecting to the Web (tablets and smartphones as well as computers), plus more advisory services channels, like social media.

Tower Group research suggests that the assumption that has driven this multi-channel strategy is that the branch is necessary to attract and retain customers, that branch density determines market share, and that non-branch channels such as those described above are add-on services, complimentary to the branch.

Have the banks succeeded in this strategy? Well, yes. The customer experience is largely consistent across channels. However, Tower Group suggests that this experience is consistently mediocre.

And therein lies the paradox. The unique value of these additional channels, especially the Web-based ones, is diluted, causing customer disengagement. And customers want to be engaged online. There is a substantial portion of the user base that is comfortable and happy transacting online. The thing that puts them off is the paucity of experience, and the paucity of experience is caused by not treating the channel as a specific, separate product with its own measures of success.

This is where Amazon shows the way.

Amazon delivers a compelling customer experience. This is the case because the online experience is a major component of Amazon’s business. When you have tech-savvy banking customers in the most desirable age bracket and social status turned off by the online experience because it is not differentiated, is not treated as a business in its own right, then it’s clear a different approach is needed.

Tower Group recommends giving electronic channels pride of place and committing to them as a business, not as an alternative. Web platform performance indicators must reflect this: they should be given a sales target, given a target Net Promoter score and aim at delivering a certain percentage of customers to be active online. The Web channel itself should have deliverables around page load time, security standards and other aspects of the recipe that makes a complete and compelling online experience.