Banking

A Vision for Omnichannel Banking

Table of Contents
6

Why Omnichannel?

12 The Key Elements of an Omnichannel

Strategy
14 The Omnichannel Strategy from SAP

2014 SAP AG or an SAP affiliate company. All rights reserved.

16 Omnichannel Platform Architecture

Digital technology is dramatically changing the banking industry by influencing the

way we bank and turning money into the ultimate digital service. To be successful,
banks require an innovative digital banking strategy that supports a variety of channels to attract and keep customers while combating increased competition from
traditional and nontraditional players.

However, digital banking innovation has been

stymied by fragmentation, complexity, and the
limited agility of existing infrastructures. At the
same time, customers continue to demand selfservice, personalization, and control. Just as
service-oriented architecture (SOA) strategies
are being implemented to harmonize the back
end, a strategy is required to harmonize customer
touch points to provide an optimized and consistent user experience across all channels.
Omnichannel banking helps banks accomplish
this goal. It enables banks to focus on providing
a consistent channel that offers an optimized,
seamless experience and meets immediate
customer needs. Meanwhile, banks can deliver
personalized service and product recommendations, regardless of the channel or device the
customer chooses to use. For banks, this is an

opportunity to fully understand the customer

by coupling individual digital channels to sophisticated analytics engines. As a result, they can
focus their attention on more profitable customers
and activities that drive value.
Todays consumers are increasingly sophisticated
and are already accustomed to targeted offerings
from companies, such as Amazon, that make
relevant purchase suggestions regardless of
the interaction channel or device. So it comes
as no surprise that these same customers
expect a similar experience from their banks.
With omnichannel banking, customers have
a consistent, channel-optimized experience
whether they choose to interact with their bank
by going online, using their mobile or tablet
device, dialing the call center, or visiting the
ATM or physical branch.

2014 SAP AG or an SAP affiliate company. All rights reserved.

2/17

SAP is innovating an omnichannel banking

platform to help banks manage the increasing
demands imposed by the requirements of new
channels and devices while they address the
evolving customer expectation for consistency
across channels. In addition to enabling banks
to transform quickly, the platform encompasses
fully functional applications that span retail and
commercial banking, mobile wallet, and mobile
money. Its open nature allows banks and its partners
to build on that platform to address the specific
needs for greater customer engagement.
This paper describes our approach to omnichannel
banking, which can help banks drive innovative
digital strategies, increase revenue, improve profitability and loyalty, and reduce costs.

DIGITAL TECHNOLOGIES ARE TRANSFORMING

BANKING
Digital technologies are significantly impacting
banking. Statistics from the Forrester report The
State of North American Digital And Multichannel
Banking 2013 point to this shift:
40% of customers sign up for new products
online
40% of customers sign up for new products
at their branch
50% of banks total customers regularly use
more than one channel
70% of banks believe customers who interact
across multiple channels are more valuable

2014 SAP AG or an SAP affiliate company. All rights reserved.

3/17

Figure 1: Benefits of Innovative Digital Strategies

More than twice the products sold to each customer in an integrated,

multichannel environment when compared to a traditional, siloed bank
Increase revenue
Twice the profitability and higher loyalty from multichannel
customers
Boost profitability
and loyalty
US$1.5 billion in industry cost savings by switching mobile bankers
one in-person deposit a month to a mobile deposit
Reduce costs

To succeed in this digital environment, banks

must deploy innovative strategies to differentiate.
In Figure 1, youll see that a customer engaged
across multiple channels is more attuned to buy
additional products and tends to be more loyal.
In addition, digital technologies that use capabilities, such as a mobile phone camera, can significantly reduce costs for banks.1, 2

1.

2.

Driving Business Value from Integrated Multichannel

Distribution, Accenture, 2012.
Enhancing the Banking Customer Value Proposition
Through Technology-Led Innovation, Accenture, 2011.

DIGITAL BANKING GOES BEYOND SERVICE

Digital banking cannot be an afterthought in
terms of adding support for new channels. Going
digital means that service, sales, and marketing
organizations should exploit all digital channels.
Providing a service across a new channel adds
cost. However, it is the first step toward monetization. Monetization happens when sales and
marketing operations are able to use new channels effectively.

Customers in todays world are empowered and

connected like never before. Theyre savvy and
know the value of fast, ubiquitous access to information on banking products and competitive
offers. Customers also expect more from their
banks: rich customer experiences regardless of
channel, tailored offerings that reflect individual

2014 SAP AG or an SAP affiliate company. All rights reserved.

4/17

 Complexity: The system landscape may be

costly to run or change. It may even be difficult
to integrate new innovative third-party services.
Agility: Customers who interface with banking
systems are becoming increasingly sophisticated
and demanding modern conveniences. This
requires a level of agility and flexibility in system
interfaces. The speed of delivering regulatory
and operational change is key to driving innovaTo get an accurate picture of every customer, you
tion and keeping customers.
need a strategy that can generate deep customer
insight: who your customers are, what their specific Self-service: Driven by experience in their
personal lives, customers are expecting and
banking needs are, and how, when, and where they
demanding more. Their expectations revolve
want to interact.
around being in control and having an engaging,
personalized experience.
With this information, the bank can deliver consistent, optimized experiences across all channels
As banks add new channels across even one
providing intuitive access to the information and
business line, they risk adding another silo to
services customers want anytime, anywhere, in
the group of existing disparate systems. As a
any channel, and on any device.
bank deploys new digital channels across its
business lines, the magnitude of the problem
And you must be responsive by offering relevant
is further compounded. In a study by Forrester
communications, offers, products, and services
based on your organizations analysis and under- Research, less than one-third of surveyed executives believed their multichannel strategy was
standing of individual history and personal
well-coordinated across business lines. And a
preferences.
majority of executives do not measure crossAs banks tackle the challenge of adding new digi- channel interactions.
tal channels, they have to overcome a series of
This lack of measurement is not due to having no
challenges across customer touch points:
desire. Rather, its because the customer touch Fragmentation: Across any single banks channel landscape, there is no single, cohesive voice point platform and associated use analysis are
not harmonized.
and appearance in promotions, products and
services, messages, and onboarding and support processes.
needs, loyalty rewards, and prompt service from
staff members that understand and value them.
The typical retail banking customer has dozens
of financial products spread across multiple
financial institutions. This means that even your
best customers could easily take their business
elsewhere.

2014 SAP AG or an SAP affiliate company. All rights reserved.

5/17

Why Omnichannel?
To realize this vision of harmonized interactions
across customer touch points, the bank needs
an omnichannel strategy that places customer
centricity at the core.

Banks continue to spend significant amounts on

harmonizing programmed access to back-end
systems. And these usually get slotted under
SOA initiatives. However, these SOA initiatives
are only part of the story. They do not provide a
mechanism for delivering an optimized, consistent experience across multiple channels.
For example, if a customer is given an offer for a
line of credit on her mobile phone, she can accept
it. However, the origination process requires multiple steps. These steps may involve a tablet, a
PC, a call center, or a branch visit. At each of
these customer touch points, it is important to
leverage the data the customer shares with the
bank. When a customer has a question, the callcenter representative should have access to the
details of the customers previous interactions.
With this type of insight, banks can drive efficiency
across channels and make monetization a real
possibility.

A CUSTOMER-CENTRIC OMNICHANNEL
APPROACH
Traditionally, banks have interacted with customers
through product silos such as retail, commercial,
wealth, brokerage, and credit card. However, a
customer is usually only using one or two products
across a single business line. Other business
lines do not have effective insight into the potential of an existing customer. With this limited view,
banks risk losing customers to their competitors
that are digital innovators.

As the Accenture survey data highlights in Figure 2,

a significant number of customers acquired
traditional banking services from an institution
other than their primary bank.

Figure 2: Banking Products Purchased by Customers in 20133

Primary bank

From whom did you buy financial services products in the last year?

Other institutions

Higher-margin products
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Checking

Savings

CDs

Home
equity
line of
credit

Money
market

College
loan

Personal
loan

Credit
card

Private Mortgage
banking

Auto
loan

Retirement

Student
Life
loan
insurance

Brokerage

Auto
Property
insurance
and
casualty
insurance

3. Accenture Retail Banking Survey 2013: Banking in the Digital Era, Accenture, 2013.

2014 SAP AG or an SAP affiliate company. All rights reserved.

6/17

Figure 3: The Methods Chosen by Customers to Purchase Banking Products in 20134

Where did you buy or sign up for the products that you purchased over the last year? Online.
30%

25%

24%

21%

15%
11%
8%
6%

2012

2013

Auto loan

2012

2013

2012

Mortgage

2013

Personal loan

2012

2013

Home equity loan

In addition, the data in Figure 3 suggests that

more customers are using Web channels to sign
up for revenue-generating products and services.

touch-point platform and real-time insight into

the customer. This common touch-point platform
is what SAP refers to as an omnichannel platform.

To effectively market and sell additional revenuegenerating products to the customer, banks need
insight into past interactions; customer preferences; and an up-to-date, 360-degree view of
the customer. This requires a common customer

Such a common customer touch-point platform

enables consistent access to different services
from within the bank to be directed toward a
customer. Coupled with the notion of a customer
information hub that can serve up insights about
customers in real time, the path toward channel
monetization gets easier.

4. Accenture Retail Banking Survey 2013: Banking in the

Digital Era, Accenture, 2013.

2014 SAP AG or an SAP affiliate company. All rights reserved.

7/17

Figure 4: Harmonization of Customer Touch Points with an Omnichannel Banking Approach

ATM, Call Center, Online, and Mobile

Omnichannel banking

Retail banking

Credit card

Mortgage

Banks hold a wealth of information about their

customers. By extracting and analyzing customer
behaviors from that data, a bank can start on the
transitory journey of moving away from product
silos to a customer-centric interaction across all
interaction channels.
BENEFITS OF AN OMNICHANNEL APPROACH
In todays increasingly digitally influenced world
of banking, measuring business outcomes is
critical. The following benefits can only be realized
with an omnichannel approach that considers
customer centricity.

Brokerage

Corporate banking

Leadership in Mobile
Mobile banking is increasingly becoming a must
have channel. Banks that have mobile capabilities
are finding that its also important to have an
effective mobile strategy.

On the other hand, banks that do not provide a

mobile interface are feeling the effects of customer
dissatisfaction. Not just young people are choosing
mobile interactions, but the most profitable, older
customers are increasingly turning to mobile and
online channels for banking.

2014 SAP AG or an SAP affiliate company. All rights reserved.

8/17

Figure 5: Rate at Which Banking Consumers Are Moving Toward the Mobile Channel5
100%

5%

7%

8%

13%

12%

15%

25%

27%

30%

31%

32%

33%

70%

66%

62%

56%

56%

52%

Q1-2012

Q2-2012

Q3-2012

Q4-2012

Q1-2013

Q2-2013

90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

Mobile only

Mobile and PC

PC only

As Figure 5 highlights, mobile-only usage is

gaining significant traction. Therefore, the use
of mobile banking as a key channel becomes
very important across the customer base. An
omnichannel approach can help banks address
this important channel effectively.

Migration of Digital Sales

Approximately 40% of customers are signing up
for new products online. This percentage is the
same number as those who sign up at a branch.
Sales in digital channels have reached an inflection
point, and this is why it is critical to have strategies
in place to originate products through digital
interactions.6

5. Youngo, Heather, The Top 10 Trends in the Digital Banking Industry, Banking.com,
www.banking2020.com/2013/12/18/top-trends-in-digital-banking.
6. The State of North American Digital and Multichannel Banking 2013, Forrester Research, April 2, 2013,
www.forrester.com/The+State+Of+North+American+Digital+And+Multichannel+Banking+2013/fulltext/-/E-RES93502.

2014 SAP AG or an SAP affiliate company. All rights reserved.

9/17

Self-Service Enablement
Driven by experiences in their own personal lives,
where customers have control and personalization,
banking customers want to accomplish more
with every single interaction in a self-service
environment.

An important indicator of the need for innovative

self-services is the mobile remote deposit capture
(RDC) chart (see Figure 6). Customers who have
access to RDC and those who do not have access
to RDC show similar deposit activity. However,
once customers start using RDC actively, branch
visits for deposit activity drop significantly.

Figure 6: Mobile RDC Changes Consumer Behavior7

Before mobile remote deposit was offered to consumers

33%

34%

67%

66%

Nonmobile RDC
consumers

Mobile RDC
consumers

Mobile RDC

After mobile remote deposit was offered to consumers

Other

32%

Consumers who
eventually use mobile
remote deposit
capture display similar
deposit activity to
consumers who never
use mobile remote
deposit, but . . .

35%

. . . once mobile remote

deposit capture
consumers start
using the service,
they quickly become
less dependent on
the branch.

16%

68%

49%

Nonmobile RDC
consumers

Mobile RDC
consumers

Branch

7. Youngo, Heather, The Top 10 Trends in the Digital Banking Industry, Banking.com,
www.banking2020.com/2013/12/18/top-trends-in-digital-banking.

2014 SAP AG or an SAP affiliate company. All rights reserved.

10/17

Increased Customer Loyalty and Engagement

Customers are visiting channels longer, and
they are spending more time on their mobile and
tablet devices. Banks that do not offer services
through digital channels are in danger of losing
customers. Figure 7 highlights the shift in time
spent during each digital visit including mobile
and online.

Figure 7: More Devices Mean More Time

Spent Online8
Shift in minutes per visit on Internet banking
3 minutes 27 seconds

2 minutes 37 seconds

2012

2013

8. Youngo, Heather, The Top 10 Trends in the Digital Banking Industry, Banking.com,
www.banking2020.com/2013/12/18/top-trends-in-digital-banking.

2014 SAP AG or an SAP affiliate company. All rights reserved.

11/17

The Key Elements of an Omnichannel

Strategy
Omnichannel is not just about providing access
to a service across multiple channels. Omnichannel also encompasses sales, marketing, and analytical tools to effectively monetize new digital
channels.
There are three keys to omnichannel strategy
elements.
CONSISTENT SERVICES ACCESS ACROSS ALL
CHANNELS
An omnichannel strategy should offer a software
architecture all channels can use to harmonize
interaction across different customer touch points.

The strategy should help ensure consistent

access to applications across both assisted and
unassisted channels. And for mobile devices,
the strategy needs to support various common
access types, such as short message service
(SMS), unstructured supplementary service data
(USSD), mobile Web, rich client, and online, while
providing a standard interface that allows ATMs,
call centers, and third-party systems to plug in.

COMPLETE, 360-DEGREE VIEW OF EVERY

CUSTOMER
To move away from product silos to true customer
centricity and effective, customer-facing sales
and marketing operations, it is important to have
a complete, 360-degree view of every customer.
Applying analytical content from customer transactions (such as next-best offers) for cross- and
up-selling in an in-memory computing environment opens the door for truly real-time banking
at a glance.

This single source of truth for customer centricity

lays the foundation for identifying potential business and converting loyalty into revenue. By combining predictive analytics or sentiment analytics
with state-of-the-art marketing capabilities, banks
can now interact with their customers on an individual basis.
As a result, the customer information hub feeds
all channels to help ensure a consistent brand
experience across every customer interaction
channel. By tailoring offers to address specific
customer needs, customer loyalty and wallet
share increases.

Figure 8: Consistent Access Across All Channels

2014 SAP AG or an SAP affiliate company. All rights reserved.

12/17

Figure 9: Customer Information Hub

Collect

Analyze and transact*

Consumer
Profile

Customer channels

The social Web

Respond and engage

Analytics powered
by SAP HANA

In-memory computing
Banking
content

Channel
content

Customer channels
and the Web

Real-time discovery and predictive

customer segmentation
Other
content

Contact data enrichment and

engagement
Supporting omnichannel campaigns
and loyalty

External sources

Real-time recommendations

Collaboration

Banking services

Customer
Service

Consumer service excellence

Marketing
Sales

Cross-bank
collaboration

Partner network

(including banking agents and credit shops)

*Transact on customer interactions

Technology that can orchestrate this process

across multiple back-end systems is needed.
Unique information should be collected at each
step, so that every new channel interaction builds
on data already submitted by the customer. As
Most origination processes involve multiple chan- a result, the origination process becomes more
nels. For instance, the origination of a line of cred- engaging, and every interaction is optimized
across each touch point.
it may start with an offer in the mobile channel,
but it will eventually be completed by contacting
the call center or visiting the banks Web site.
However, back-end systems that originate products need complete information.
DIGITAL MANAGEMENT OF ORIGINATION
Once an opportunity is identified and a customer
accepts it, it is important to manage the origination process for multiple channels.

2014 SAP AG or an SAP affiliate company. All rights reserved.

13/17

The Omnichannel Strategy from SAP

The omnichannel strategy from SAP incorporates
a platform and process-orchestration capabilities
that drive customer-centric interactions across
multiple channels. In addition, a customer information hub provides a complete, 360-degree
view of the customer allowing banks to pinpoint
new opportunities for monetizing and serving
customers better in real time.

The desired end goal of an omnichannel strategy

is to provide an optimized, engaging, and integrated
customer experience. For all digital channels, this
means a simple interface for every interaction, a
consistent experience, and personalized service.
To meet these demands, the platform gives banks
the power to control the user experience while
allowing them to incorporate new innovations
into the software environment.

Figure 10: Choice of User Interfaces

2014 SAP AG or an SAP affiliate company. All rights reserved.

14/17

Our approach is aligned with the following

principles.

Figure 11: A Consistent Customer-Centric

Experience

CONSISTENT OMNICHANNEL USER EXPERIENCE

Banks should have the flexibility to control the
end-user experience and not be tethered to what
comes out of the box with specific applications.
Architecturally, SAP is focused on providing a
combination of platforms and applications that
give the flexibility needed to create and control
the user interface for each channel to optimize
customer engagement.
OPEN STANDARDS BASED ON A FUTURE-PROOF
PLATFORM
The key factors in realizing an omnichannel
strategy are the openness of technology, the
discipline of extending it for differentiation, and
an approach to upgrades that protect investments in customizations. A standards-based
foundation and operating architecture are the
basis of an omnichannel platform. This helps
ensure a clean separation between core capabilities and customizations. And applications that
use the platform get the added benefit of foundational services to achieve a faster rollout of new
capabilities.

The above principles enable banks of all sizes to

choose how they want to tailor customer experiences that are optimized for their target audiences.
Whether mobile, tablet, or online, the omnichannel
platform provides the architecture to deliver on a
customer-centric experience.

INTEGRATION WITH COMPLEMENTARY

SAP SOFTWARE TECHNOLOGIES
Since SAP builds other applications and technologies aligned to open standards, it becomes easier
to apply and integrate SAP software innovations
with data management and analytics, which are
key necessities for comprehensive customer
insight.

2014 SAP AG or an SAP affiliate company. All rights reserved.

15/17

Omnichannel Platform Architecture

to manage origination and related processes
across multiple back ends. SAP Mobile Platform
forms the foundation for harmonized access to
all channels.

The omnichannel platform architecture follows

the principles of a layered architecture that
adheres to SOA principles. The architecture
effectively combines a platform for consistent
access and a process orchestration layer (POL)

Figure 12: Omnichannel Platform Architecture

Channel UI
SAP UI5 application

Kapsel

Native

Metadata driven

Commercial

Partner IP

(iOS, Android, Windows

Mobile, and BlackBerry)

(Cordova / SAP UI5)

IVR

SMS

HTTP(S) / Representational State Transfer / OData

Omnichannel solution

Omnichannel foundation/Business services

Omnichannel banking
Wallet

Retail

Entitlements, validators, audit logging, and caching

HTTP(S) / Simple Object Access Protocol

Process orchestration layer (POL)

SOA (Create, check, and execute)

POL
Process logic

Process object
type

HTTP(S) / Simple Object Access Protocol

Back end

Business functionality

SOA for enterprise services

SOA for enterprise services

Third-party systems

Banking services 8.0

SAP Customer
Relationship Management

Business logic

Business logic

Business logic

Business data

Business data

Business data

UI libraries provided by partners, customers, and SAP

Business services consumed by partners and customers
POL libraries provided by customers and SAP

2014 SAP AG or an SAP affiliate company. All rights reserved.

16/17

The architecture supports mobile and online

access by using different technologies, such as
SMS, USSD, mobile Web, and rich client interfaces.
The open architecture also enables access
through interactive voice response (IVR) and
third-party systems.
The platform comes delivered with a series of
foundational services that defined business
services can use to accelerate the development
of new innovative services.
The POL manages process orchestration across
SAP and non-SAP systems. Each layer interfaces
with each other by using industry-standard
protocols and principles.
BUSINESS SERVICES
As banks work to address new channels, there is
an opportunity for channel renewal investment.
Older commercial and retail banking applications
need a modern makeover.

In addition to a modern standards-based platform,

SAP provides user-facing applications on the
platform to enable banks to deliver on innovative
digital strategies faster. SAP provides complete
applications for digital retail banking, digital commercial banking, mobile wallet, and mobile money.
These complete applications work across all
mobile channels and online.
By combining the omnichannel platform with
core services enabled by SOA, banks can realize
their own real-time vision for digital banking.
CONCLUSION
The vision of digital banking includes the ability
to give customers an optimized and engaging
experience, no matter which interaction channel
is used. The omnichannel strategy from SAP can
help banks realize this vision. With an omnichannel
platform and customer information hub, banks
can now deploy innovative digital strategies across
sales, service, and marketing to realize the business benefits of increased revenue, improved
loyalty, and reduced costs.

Studio SAP | 30869enUS (14/14) 2014 SAP AG or an SAP affiliate company. All rights reserved.

17/17

 2014 SAP AG or an SAP affiliate company. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or for any purpose without the
express permission of SAP AG or an SAP affiliate company.
SAP and other SAP products and services mentioned herein as well as their respective logos are
trademarks or registered trademarks of SAP AG (or an SAP affiliate company) in Germany and other
countries. Please see http://www.sap.com/corporate-en/legal/copyright/index.epx#trademark for
additional trademark information and notices. Some software products marketed by SAP AG and its
distributors contain proprietary software components of other software vendors.
National product specifications may vary.
These materials are provided by SAP AG or an SAP affiliate company for informational purposes only,
without representation or warranty of any kind, and SAP AG or its affiliated companies shall not be liable for
errors or omissions with respect to the materials. The only warranties for SAP AG or SAP affiliate company
products and services are those that are set forth in the express warranty statements accompanying such
products and services, if any. Nothing herein should be construed as constituting an additional warranty.
In particular, SAP AG or its affiliated companies have no obligation to pursue any course of business
outlined in this document or any related presentation, or to develop or release any functionality mentioned
therein. This document, or any related presentation, and SAP AGs or its affiliated companies strategy
and possible future developments, products, and/or platform directions and functionality are all subject
to change and may be changed by SAP AG or its affiliated companies at any time for any reason without
notice. The information in this document is not a commitment, promise, or legal obligation to deliver
any material, code, or functionality. All forward-looking statements are subject to various risks and
uncertainties that could cause actual results to differ materially from expectations. Readers are cautioned
not to place undue reliance on these forward-looking statements, which speak only as of their dates, and
they should not be relied upon in making purchasing decisions.