How can banks strengthen their digital sales channels?

How are digital pioneers leveraging the potential of digital sales channels?

A look at the competition illustrates the potential of digital sales channels. Trade Republic’s concept is in tune with the times: a simple product range, a user-friendly app, low fees and attractive interest rates on deposits. The entry barriers to securities trading have fallen, especially for younger customers.

Figure 1: Number of smartphone unlocks per day

European competitors demonstrate that traditional branch banks can also successfully sell digital products. According to former CEO Willi Cernko, Erste Bank now sells “almost half of all products in their retail customer business digitally”. Similar figures were published by Belgium’s KBC, which sold 52% of its “core products” digitally, and Italy’s Intesa Sanpaolo, which reported that 40% of its sales were made via digital channels.

Thanks to their network structures, German regional banks also have strong technical infrastructures – including digital closing processes, data analytics and mobile applications. Some banks only need to implement them on a technical and procedural level. The Sparkasse app has over 18 million active users, while that of the Volksbanken and Raiffeisenbanken has just under 6 million. However, the actual sales success via these channels is often low, and the reach is underutilized.

How can digital sales be strategically activated?

Technology alone is not enough. What is missing in many places is the consistent integration of digital sales as a strategic business area. Often, there is a lack of management attention, clear responsibilities and cross-departmental cooperation.

Yet, the situation is clear: unlocking digital potential requires an entrepreneurial mindset – driven by focus, leadership and resources. While not trivial, it is certainly not impossible for a regional bank to make better use of its digital sales potential.

The following aspects are fundamental to doing so:

1. Assuming digital leadership: Top management must actively support digital sales channels by allocating concrete resources, setting strategic goals and providing regular reports.
2. Ensuring clear responsibility: A dedicated area of responsibility for digital sales with its own staff and budget enables focused further development.
3. Establishing interdisciplinary collaboration: The technology, product, marketing and sales departments must collaborate closely because digital sales are cross-functional.
4. Implementing technical standards quickly: Centrally provided solutions and processes should be introduced promptly to support business policy objectives.
5. Thinking through and continuously improving the entire customer journey: Digital sales encompass far more than just closing a sale. What matters is seamless optimization from first contact to follow-up. Successful institutions continuously enhance their processes in a data-based, customer-oriented manner.
6. Ensuring visibility and accessibility: Target group-oriented content and clear placement of products on digital channels increase the likelihood of closing a sale.
7. Defining focus products: Easy-to-understand and easy-to-complete product variants reduce barriers. Seamless processes and intuitive guidance are a must.
8. Using personalized interaction: By using data intelligently, offers can be individualized and displayed in a targeted and context-related manner, providing added value for customers.
9. Connecting channels effectively: Digital sales generate leads for personal advice and vice versa. Key components include managing potential customer interactions and making follow-up calls to customers who did not complete the sales process.
10. Setting the right incentives: When all units – from consulting to marketing – are measured against digital sales success, a common focus is created.

What conclusions can be drawn regarding the role of digital sales channels?

The app is also becoming an indispensable sales channel for regional banks, offering numerous functions:

• Staffing the customer interface daily
• Meeting basic needs in payment transactions and self-service
• Informing, addressing and interacting with customers
• Generating leads for hybrid and in-branch sales
• Capitalizing on untapped market potential through digital product sales

More insights into retail banking at regional banks

If you’re interested in gaining further exciting insights into retail banking at regional banks, you can download the latest whitepaper “Omnichannel: Excellence in customer and advisory services – How regional banks can hold their own against (digital) competitors in the retail banking business.” here.