Viewing offline content

Limited functionality available

Dismiss
United States
  • Services

    What's New

    • Register for Dbriefs webcasts

    • Unlimited Reality™

      Metaverse solutions that drive value

    • Sustainability, Climate & Equity

      Cultivating a sustainable and prosperous future

    • Tax

      • Tax Operate
      • Tax Legislation
      • Tax Technology Consulting
      • Global Employer Services
      • Legal Business Services
      • Tax Services
    • Consulting

      • Core Business Operations
      • Customer & Marketing
      • Enterprise Technology & Performance
      • Human Capital
      • Strategy & Analytics
    • Audit & Assurance

      • Audit Innovation
      • Accounting Standards
      • Accounting Events & Transactions
    • Deloitte Private

    • M&A and Restructuring

    • Risk & Financial Advisory

      • Accounting & Internal Controls
      • Cyber & Strategic Risk
      • Regulatory & Legal
      • Transactions and M&A
    • AI & Analytics

    • Cloud

    • Diversity, Equity & Inclusion

  • Industries

    What's New

    • The Ripple Effect

      Real-world client stories of purpose and impact

    • Register for Dbriefs webcasts

    • Industry Outlooks

      Key opportunities, trends, and challenges

    • Consumer

      • Automotive
      • Consumer Products
      • Retail, Wholesale & Distribution
      • Transportation, Hospitality & Services
    • Energy, Resources & Industrials

      • Industrial Products & Construction
      • Power, Utilities & Renewables
      • Energy & Chemicals
      • Mining & Metals
    • Financial Services

      • Banking & Capital Markets
      • Insurance
      • Investment Management
      • Real Estate
    • Government & Public Services

      • Defense, Security & Justice
      • Federal health
      • Civil
      • State & Local
      • Higher Education
    • Life Sciences & Health Care

      • Health Care
      • Life Sciences
    • Technology, Media & Telecommunications

      • Technology
      • Telecommunications, Media & Entertainment
  • Insights

    Deloitte Insights

    What's New

    • Deloitte Insights Magazine

      Explore the latest issue now

    • Deloitte Insights app

      Go straight to smart with daily updates on your mobile device

    • Weekly economic update

      See what's happening this week and the impact on your business

    • Strategy

      • Business Strategy & Growth
      • Digital Transformation
      • Governance & Board
      • Innovation
      • Marketing & Sales
      • Private Enterprise
    • Economy & Society

      • Economy
      • Environmental, Social, & Governance
      • Health Equity
      • Trust
      • Mobility
    • Organization

      • Operations
      • Finance & Tax
      • Risk & Regulation
      • Supply Chain
      • Smart Manufacturing
    • People

      • Leadership
      • Talent & Work
      • Diversity, Equity, & Inclusion
    • Technology

      • Data & Analytics
      • Emerging Technologies
      • Technology Management
    • Industries

      • Consumer
      • Energy, Resources, & Industrials
      • Financial Services
      • Government & Public Services
      • Life Sciences & Health Care
      • Technology, Media, & Telecommunications
    • Spotlight

      • Deloitte Insights Magazine
      • Press Room Podcasts
      • Weekly Economic Update
      • COVID-19
      • Resilience
      • Top 10 reading guide
  • Careers

    What's New

    • Our Purpose

      Exceptional organizations are led by a purpose. At Deloitte, our purpose is to make an impact that matters by creating trust and confidence in a more equitable society.

    • Day in the Life: Our hybrid workplace model

      See how we connect, collaborate, and drive impact across various locations.

    • The Deloitte University Experience

      Explore Deloitte University like never before through a cinematic movie trailer and films of popular locations throughout Deloitte University.

    • Careers

      • Audit & Assurance
      • Consulting
      • Risk & Financial Advisory
      • Tax
      • Internal Services
      • US Delivery Center
    • Students

      • Undergraduate
      • Advanced Degree
      • Internships
    • Experienced Professionals

      • Additional Opportunities
      • Veterans
      • Industries
      • Executives
    • Job Search

      • Entry Level Jobs
      • Experienced Professional Jobs
      • Recruiting Tips
      • Explore Your Fit
      • Labor Condition Applications
    • Life at Deloitte

      • Life at Deloitte Blog
      • Meet Our People
      • Diversity, Equity, & Inclusion
      • Corporate Citizenship
      • Leadership Development
      • Empowered Well-Being
      • Deloitte University
    • Alumni Relations

      • Update Your Information
      • Events
      • Career Development Support
      • Marketplace Jobs Dashboard
      • Alumni Resources
  • US-EN Location: United States-English  
  • Contact us
  • US-EN Location: United States-English  
  • Contact us
    • Dashboard
    • Saved items
    • Content feed
    • Subscriptions
    • Profile/Interests
    • Account settings

Welcome back

Still not a member? Join My Deloitte

First impressions count

by Val Srinivas, Steve Fromhart, Urval Goradia
  • Save for later
  • Download
  • Share
    • Share on Facebook
    • Share on Twitter
    • Share on Linkedin
    • Share by email
Deloitte Insights
  • Strategy
    Strategy
    Strategy
    • Business Strategy & Growth
    • Digital Transformation
    • Governance & Board
    • Innovation
    • Marketing & Sales
    • Private Enterprise
  • Economy & Society
    Economy & Society
    Economy & Society
    • Economy
    • Environmental, Social, & Governance
    • Health Equity
    • Trust
    • Mobility
  • Organization
    Organization
    Organization
    • Operations
    • Finance & Tax
    • Risk & Regulation
    • Supply Chain
    • Smart Manufacturing
  • People
    People
    People
    • Leadership
    • Talent & Work
    • Diversity, Equity, & Inclusion
  • Technology
    Technology
    Technology
    • Data & Analytics
    • Emerging Technologies
    • Technology Management
  • Industries
    Industries
    Industries
    • Consumer
    • Energy, Resources, & Industrials
    • Financial Services
    • Government & Public Services
    • Life Sciences & Health Care
    • Tech, Media, & Telecom
  • Spotlight
    Spotlight
    Spotlight
    • Deloitte Insights Magazine
    • Press Room Podcasts
    • Weekly Economic Update
    • COVID-19
    • Resilience
    • Top 10 reading guide
    • US-EN Location: United States-English  
    • Contact us
      • Dashboard
      • Saved items
      • Content feed
      • Subscriptions
      • Profile/Interests
      • Account settings
    06 September 2017

    First impressions count Improving the account opening process for Millennials and digital banking customers

    06 September 2017
    • Val Srinivas United States
    • Steve Fromhart United States
    • Urval Goradia United States
    • Save for later
    • Download
    • Share
      • Share on Facebook
      • Share on Twitter
      • Share on Linkedin
      • Share by email
    • Serving Millennials and the digital customers of tomorrow
    • Who exactly wants a better account opening experience?
    • Consumers view regulations as beneficial, potentially helping banks
    • What does improvement mean?
    • How can banks improve the account opening process?
    • Appendix: Study methodology

    ​Little things can add up. A new study shows that Millennials and digital customers see room for improvement in retail banks’ account opening processes. Where were the gaps? And what small steps could banks take to create a better experience?

    Serving Millennials and the digital customers of tomorrow

    Millions of consumers open new accounts every day with online stores, cable companies, mobile ridesharing apps, and of course, with banks. Now imagine one such consumer—a Millennial named Max—opening a new account at a popular online shopping site. On the same day, Mia—another Millennial—opens a new account at a bank. Who do you think had a better experience—Max or Mia?

    If you thought Max, you are likely wrong.

    Conventional wisdom suggests that the account opening process at many banks seems to have become burdensome, due to heightened regulatory demands and compliance and control pressures. Banks today collect more customer information than ever before, follow a greater number of steps while onboarding, and ensure strict controls throughout the customer service life cycle.1 Meanwhile, the ease of opening a new account on digital platforms—in online commerce, ridesharing services, and even person-to-person (P2P) payments and online lending, is resetting customer expectations, particularly among Millennials.2

    Who exactly wants a better account opening experience?

    To better understand how these dynamics impact the account opening experience of retail bank customers, Deloitte surveyed more than 3,000 consumers who opened a bank account recently for three product categories (see appendix for survey methodology).

    What did we find? The survey turned up several interesting results. First, consumers view the account opening experience at banks more favorably than registration experiences in many other industries. Second, a vast majority of customers, including Millennials, are aware of regulations related to the account opening process, and also believe them to be beneficial.

    However, and perhaps most importantly, though customers of all ages are satisfied with the account opening process, a meaningful share want the account opening experience to be improved (figure 1). Specifically, Millennials, mobile-banking users, and recently acquired existing customers of the bank were most likely to demand improvement.

    Could the account opening experience be improved?

    Why do banks need to do a better job with account opening? A superior account opening experience can be vital for banks to remain competitive and to ensure loyalty—customers who think the account opening process can be made better at their banks are, in hindsight, much more likely to think about taking their business to another bank. The survey also found that consumers who wanted improvement in their account opening experience were less likely to purchase additional products or services at the bank, and were less enthusiastic about recommending the institution to their family and friends. And 75 percent of improvement seekers were below age 50—a commercially critical demographic, as they are the banks’ future customer base.

    But what does “a better account opening experience” mean? The most fundamental attribute of an exceptional account opening experience is speed—the faster an account is opened, the less likely the customer is to want improvement. Consumers demand that banks use their existing information to not only speed the process up, but also to cross-sell relevant products to them. Banks should also give consumers clear and concise instructions during the account opening process, and follow up with them to inquire whether they have questions and are satisfied with their accounts.

    So, how can banks improve? Banks can achieve specific capabilities that meet customer demands by investing in not only the right capabilities to improve the direct digital interface with customers, but also in technology available to frontline staff to help them be focused and empathetic toward customers. By leveraging some critical new insight, banks should also harness customers’ favorable view of regulations in their messaging strategies to emphasize security, safety, and rigor.

    Millennials and mobile-banking consumers are the most demanding

    Our survey shows that typical consumers who want improvement are more likely to be Millennials and that they especially have higher expectations when interfacing with banks through digital channels.

    While opening accounts on mobile applications is still nascent—only about 5 percent of respondents in the survey opened accounts through a mobile application—consumers who opened accounts on a mobile phone, compared to bank branches and online banking (the two main channels used to open accounts), were much more likely to say that the retail bank account opening process needed improvement (figure 2). And, again, more than half (54 percent) of consumers who opened accounts on a mobile device were Millennials.

    While many banks themselves recognize their deficiency in offering robust mobile account opening services,3 clearly, the mobile channel is where the action seems to be headed in the future. Banks should redouble their efforts in this area as a necessary competitive lever, as all types of customers increasingly gravitate to this channel.4

    Demand for improvement in account opening,   by channel

    Don’t test the patience of these young, demanding customers

    We also found that existing customers with relatively shorter relationships (five years or less since the first account was opened), a cohort dominated by younger respondents, want the account opening process to improve (figure 3)—this holds across all the main product categories (deposit accounts, loans, and wealth/retirement solutions). In contrast, consumers who were opening accounts at a completely new institution, or those who had longer relationships (more than five years) were much less likely to say that their account opening experience could have been better.

    These findings suggest that although demanding consumers are capable of being patient during a first account onboarding with a bank, they expect banks to then use the information they already have to streamline follow-on account openings. This expectation appears quite reasonable, and is probably easy enough for banks to establish as a core operating principle.

    Length of relationship and demand for improvement

    Consumers view regulations as beneficial, potentially helping banks

    Regulations that require banks to collect information and documentation are…

    A fundamental, yet potentially surprising, finding from our survey is that the lion’s share of customers (81 percent of our sample) are aware that regulations require banks to collect a wide range of information and documentation from customers, and that a majority of customers, including most Millennials, feel that these regulations are beneficial (figure 4).

    Even more revealing, many consumers, once again including Millennials, rate the experience of opening bank accounts as easier than signing up for a range of other services in other industries—from the traditional, such as signing up for a new cable service on the phone, to those powered by digital interfaces, such as signing up for app-based car ridesharing services (see figure 5).

    In addition to what banks are doing correctly in the account opening experience, two factors might be influencing consumers’ opinions. First, they might be viewing a financial relationship as different from other types of service interactions, inducing an additional level of seriousness and patience in the interaction. And second, the fact that consumers know about regulatory requirements, as noted above, might be tamping down expectations around speed and complexity.

    Opening an account at this bank is easier than...

    What does improvement mean?

    To find out what customers want—especially Millennials—we distilled some salient points in the experiences of demanding customers who thought their account opening experience could be improved.

    Understand—and act upon—the need for speed

    The time it took to open the account was the single stand-out predictive observation for those who demanded improvement in their account opening experience. For example, a deposit account opened in 45–60 minutes was over five times more likely to draw a demand for improvement compared to accounts opened in less than 15 minutes (figure 6). This positive association between speed of account opening and the demand for improvement also held for consumer loan and wealth management accounts.

    Once you decided to open the deposit account, how long did it take you to complete the steps required by the bank?

    Back up your claims with results, or else . . .

    The customer who expects more will typically not hesitate to look elsewhere. Customers who sought improvement were much more likely to have opened the account after some external stimuli, such as seeing an ad about the account, a recommendation from a financial adviser, or simply because they liked the bank’s mobile app or website (figure 7). These findings may indicate that consumers often develop high expectations based on these influences, and are then potentially let down by the experience of actually opening the account. They also suggest a potential disconnect between the quality and promise of marketing programs and/or digital advertising, and the actual quality of the account opening experience.

    Why did you open this account at this bank?

    Consumers seeking improvement were also several times as likely to say that in hindsight, they may have gone to another institution to open the account (figure 8). Millennials, again, were the largest component of this group.

    Another obvious, but important, message for banks—customers who expect more are likely to think that another bank or an online/digital-only bank would make the account opening process easier or faster. And from a commercial perspective, consumers who sought improvement said they were less likely to purchase additional products or services at the bank, were less enthusiastic about recommending the institution to others, and even less likely to trust their bank.

    Share of total respondents who agreed with the statement: Knowing how long/hard the process is, I would have opened an account elsewhere

    Provide clear instructions and communication before and during account opening

    Our study also revealed that consumers who expected a better account opening experience often felt the bank’s information and documentation requirements were not clear. Importantly, the improvement seekers in our survey also rated themselves as having a high knowledge of banking. This finding suggests that the more that customers believe they know about banking, the more likely they are to expect a better experience.

    Be mindful about cross-selling

    One of the most interesting findings from our survey is that consumers who were the target of a cross-sell attempt during the account opening process were more likely to think that the experience could be improved (figure 9). Notably, consumers who actually considered a purchase based on a cross-sell attempt—the ones who showed a greater measure of attentiveness to the sales pitch—were also more likely to demand improvement. Together, these data tell us that cross-sell attempts at banks, at least those made during the account opening process, currently appear to be hit-or-miss, and should become more insight-driven.

    How cross-selling factors into the account opening experience

    Follow up!

    We also observed that the lack of a follow-up by the bank created much greater dissatisfaction among the improvement-seeking group (figure 10). Even more alarming for banks, these demanding customers also had to follow up with the institution on their own, at a rate that was many times higher than other consumers. The reasons consumers gave for following up were wide-ranging, but included information about the account that should have been delivered during the account opening process. These findings show a clear, and frankly elementary, customer service failure by banks.

    How following up could affect customer satisfaction

    How can banks improve the account opening process?

    The range of data we have examined on gaps in the account opening process highlight a critical fact—many banks seem to still fumble the basics. In that light, the advice below, while not wholly novel, is backed by hard data and primary research rigor to keep the distraction of conventional wisdom(s) at bay:

    1. Prepare for a mobile future. By any measure, mobile banking is quickly growing to become a fundamental pillar of retail bank offerings, not only to Millennials, but also to older customers.5 Giving consumers the ability to seamlessly open accounts on a mobile device is expected to be one of the cornerstones of outstanding customer service.
    2. Enable high-quality frontline staff interactions. Our results seem to also highlight the need for attentive and empathetic human interaction by frontline staff during the account opening process. Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations have increased requirements—both for information and documentation. Better systems and tools that enable service representatives to focus on the customer instead of being mired in the minutiae of meeting regulatory and other process requirements might be the most fundamental improvement that banks can make while opening accounts in a branch or on the phone.
    3. Use data and analytics for a faster and tailored experience. Delivering a faster account opening experience—especially to young existing customers, who tend to be the most demanding—likely relies on fully exploiting information that the bank already possesses. Linking customer data across products and businesses, while simple in concept, may still be difficult for banks to achieve in practice. This deficiency also appears to extend to analytics (“next-best offer” solutions and the like), as evidenced by consumer responses to cross-selling. More sophisticated predictive analytics can enable banks to tailor the customer experience with cross-sell attempts that accurately reflect customer needs.
    4. Emphasize regulatory rigor. Perhaps the starkest finding of our study is that no matter what banks think about KYC regulations, the vast majority of retail banking customers think that these regulations are beneficial. In this regard, banks might even want to emphasize it in their overall messaging strategy as a benefit that customers don’t get from less regulated non-bank competitors. At a broader level, banks should communicate that customer security, and not just meeting regulatory demands, is the motive for greater inquisitiveness during the account opening process.
    5. Finally, follow up, and eliminate the need for customers to do it themselves. Following up with customers to resolve any queries and gauge satisfaction with the account opening process is a relatively simple service element that banks should meet. These follow-ups should also give consumers easy access to information on account use or activation, or inform customers on specific features, offers, or promotions associated with the account.

    Appendix: Study methodology

    Customer age

    Customer household income

    Channel used to open account

    For this study, Deloitte surveyed 3,000 retail banking consumers who had opened either a deposit (57 percent of respondents), wealth management (17 percent), or consumer loan (26 percent) account from January 2016 to May 2017. The distribution of respondents, shown in figures 11, 12, and 13, skewed toward a younger cohort—this was to be expected given that individuals opening new accounts would tend to have emerging financial needs.

    Forty percent of surveyed consumers opened their accounts at an institution with which they had no prior relationship. This provided us adequate basis to differentiate between their account opening experiences and those of consumers who added an account to an existing relationship.

    The survey sample distribution may not be representative of the population of consumers who opened bank accounts in 2016 and 2017—none that we know of exists—making it difficult to estimate sampling error or to weight the sample. Nonetheless, we believe our survey design gives us sufficient basis to make cohort-level and product-level conclusions.

    Finally, the survey was tailored to factor in the product for which the account was opened, and importantly, the channel through which the account was opened. The natural fallout of channels used to open accounts shows the enduring popularity of branches, but with online account opening also featuring heavily.

    Credits

    Written By: Val Srinivas, Steve Fromhart, Urval Goradia

    Cover image by: Katie Edwards

    Acknowledgements

    The authors and the Center also thank the following Deloitte professionals for their support and contributions:

     

    Michelle Chodosh, senior marketing manager, Deloitte Center for Financial Services, Deloitte Services LP

    Patricia Danielecki, senior manager, chief of staff, Deloitte Center for Financial Services, Deloitte Services LP

    Krishna Kumar, editor, Deloitte University Press, Deloitte Services LP

    Erin Loucks, manager, campaign management, Deloitte Services LP

    Endnotes
      1. Temenos, “Top 5 regulatory burdens faced by banks,” August 3, 2015, https://www.temenos.com/en/blog/2015/august/regulation-headaches/#, accessed July 19, 2017. View in article

      2. Melanie Friedrichs, “Is American banking falling behind?,” BankNXT, February 25, 2013, https://banknxt.com/4323/is-american-banking-falling-behind/. View in article

      3. Jim Marous, “2017 account opening and onboarding: Benchmarking study,” The Digital Banking Report, no. 249 (June 2017). View in article

      4. Board of Governors of the Federal Reserve System, Consumer and mobile financial services 2016, March 2016. View in article

      5. Ibid. View in article

    Show moreShow less

    Topics in this article

    Financial Services , Millennials , Customer Retention , Consumer Products , Banking & Capital Markets

    Deloitte Center for Financial Services

    View
    Download Subscribe

    Related

    img Trending

    Interactive 3 days ago

    Val Srinivas

    Val Srinivas

    Research Leader, Banking & Capital Markets | Deloitte Services LP

    Val Srinivas is the banking and capital markets research leader at the Deloitte Center for Financial Services. He leads the development of our thought leadership initiatives in the industry, coordinating our various research efforts and helping to differentiate Deloitte in the marketplace. He has more than 20 years of experience in research and marketing strategy.

    • vsrinivas@deloitte.com
    • +1 212 436 3384
    Steve Fromhart

    Steve Fromhart

    Manager | Deloitte Services LP

    Stephen Fromhart, Deloitte Services LP, is a manager at the Deloitte Center for Financial Services covering the banking and capital markets sectors. Prior to joining Deloitte, he directed a research and strategy group covering multiple industries, which included leading a specialized sub-unit that conducted sovereign risk analysis. Steve earned his Master’s from the School of International and Public Affairs at Columbia University and has contributed to white papers for the World Economic Forum.

    • sfromhart@deloitte.com
    • +1 212 492 3105
    Urval Goradia

    Urval Goradia

    Urval, Deloitte Services LP, is a senior market insights analyst at the Deloitte Center for Financial Services. Urval researches and writes on a broad range of themes in banking and capital markets, including strategy, risk, and regulation, with a specific focus on performance imperatives. Before joining Deloitte, he was a credit analyst covering financial institutions at the Fitch Group. Goradia is a CFA charter holder.

    • ugoradia@deloitte.com
    • +1 212 436 2085

    Share article highlights

    See something interesting? Simply select text and choose how to share it:

    Email a customized link that shows your highlighted text.
    Copy a customized link that shows your highlighted text.
    Copy your highlighted text.

    First impressions count has been saved

    First impressions count has been removed

    An Article Titled First impressions count already exists in Saved items

    Invalid special characters found 
    Forgot password

    To stay logged in, change your functional cookie settings.

    OR

    Social login not available on Microsoft Edge browser at this time.

    Connect Accounts

    Connect your social accounts

    This is the first time you have logged in with a social network.

    You have previously logged in with a different account. To link your accounts, please re-authenticate.

    Log in with an existing social network:

    To connect with your existing account, please enter your password:

    OR

    Log in with an existing site account:

    To connect with your existing account, please enter your password:

    Forgot password

    Subscribe

    to receive more business insights, analysis, and perspectives from Deloitte Insights
    ✓ Link copied to clipboard
    • Contact us
    • Search jobs
    • Submit RFP
    • Subscribe to Deloitte Insights
    Follow Deloitte Insights:
    Global office directory US office locations
    US-EN Location: United States-English  
    About Deloitte
    • About Deloitte
    • Client stories
    • My Deloitte
    • Deloitte Insights
    • Email subscriptions
    • Press releases
    • Submit RFP
    • US office locations
    • Alumni
    • Global office directory
    • Newsroom
    • Dbriefs webcasts
    • Contact us
    Services
    • Tax
    • Consulting
    • Audit & Assurance
    • Deloitte Private
    • M&A and Restructuring
    • Risk & Financial Advisory
    • AI & Analytics
    • Cloud
    • Diversity, Equity & Inclusion
    Industries
    • Consumer
    • Energy, Resources & Industrials
    • Financial Services
    • Government & Public Services
    • Life Sciences & Health Care
    • Technology, Media & Telecommunications
    Careers
    • Careers
    • Students
    • Experienced Professionals
    • Job Search
    • Life at Deloitte
    • Alumni Relations
    • About Deloitte
    • Terms of Use
    • Privacy
    • Privacy Shield
    • Cookies
    • Cookie Settings
    • Legal Information for Job Seekers
    • Labor Condition Applications
    • Do Not Sell or Share My Personal Information

    © 2023. See Terms of Use for more information.

    Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ("DTTL"), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as "Deloitte Global") does not provide services to clients. In the United States, Deloitte refers to one or more of the US member firms of DTTL, their related entities that operate using the "Deloitte" name in the United States and their respective affiliates. Certain services may not be available to attest clients under the rules and regulations of public accounting. Please see www.deloitte.com/about to learn more about our global network of member firms.

    Learn more about Deloitte's work for the US Olympic Committee