The trends and challenges with the ever-increasing tech-savvy society we live in today are carrying over into the retail banking industry. Retail banking customers are more connected now than ever, with most of our customers' homes having more technology in them than our branches. Couple these technology trends with major shifts in the way customers want and choose to bank, and it is clear why many in the financial services industry are re-evaluating the way their institutions operate and deliver products and services.

When we take a deeper look at the retail banking industry today, we can see that many of the changes necessary are being driven by consumer needs and expectations. The multichannel approach, while an improvement from disconnected delivery channels of the past, is no longer sufficient to address these new consumer demands.

Multichannel versus Omnichannel: What's the difference?

An omnichannel strategy can be considered an evolution from multichannel. In essence, the omnichannel approach combines the physical channel that is the bank branch with virtual channels such as online and mobile. With omnichannel banking, customers choose how they want to bank, be that at their local branch; contact center; any other bank branch; from home; or from their mobile device. The challenge facing retail banks is how to ensure a seamless, consistent experience for the customer that results in unprecedented levels of customer satisfaction and growth and profitability for the bank.

At this stage, however, we must understand what the exact needs of the customer are and how we can help retail banks meet their customers' needs.

Through recent research conducted by Cisco's Internet Business Solutions Group, we learned that retail banking customers' greatest needs are more personalized, higher-quality interactions enabled by video and advice-centered omnichannel experiences. In short, customers want easily accessible interactions, whether it is through a physical branch, online, or a mobile application. Bank customers desire flexibility and want banks to deliver financial advice and banking services through both virtual and physical channels, ushering in a new era of omnichannel banking that provides customers with services in a manner most convenient and personalized to their needs.

Interestingly enough, even with the increase in online and mobile channel use, customers are not ready to switch to an all virtual banking experience. Globally, approximately 22 percent of customers would not be happy about their bank closing their local branch and would switch banks.

Bank branches will need to evolve to accommodate the needs of those seeking financial advice, while transitioning their branch model to be technology-friendly for bankers and customers alike. One size will not fit all when it comes to the omnichannel branch, and new branch concepts like an advisory branch, streamlined branch, flexible branch, and community branch are already being tested.

How do we begin to prioritize and consider the numerous technologies that could potentially change the historic retail banking model? It needs to start with your corporate imperatives and priorities. Next, a focus on the imperatives of the lines of business that map back to those corporate imperatives. Finally, identify specific use cases and the capabilities that need to be enabled to deliver those use cases. Once the needed capabilities linked to line of business imperatives are understood and prioritized, the technology can be implemented in phases.The first phase in implementing a new technology should be limited both in the technology being evaluated and the success criteria that are established. The main focus of this phase is to determine employee and customer acceptance of the technology.

Subsequent phases are for proving that technologies can be integrated, and that the integration provides incremental value to the customer and the bank. Should this phase be successful, broader line of business adoption, greater scale and more automated reporting on the usage and benefits being delivered by the new technology would follow.

Upon final rollout all applicable channels and lines of business are enabled, and the focus turns to continued communication of the new capabilities -both internally and externally.

Cisco is focused on helping retail banks catch up and take full advantage of the recent breakthroughs in technology. Through our investments in financial industry solutions and resources, we are helping our customers develop and enable a future vision, bridge their gap between business and IT, leverage their existing and new technologies, and change the conversation from Total Cost of Ownership (TCO) to Return on Investment (ROI).

The new omnichannel strategy starts and ends with the customer and the multiple choices the customer has when it comes to banking. By carefully evaluating and prioritizing your technology options, based on your corporate imperatives, and over communicating and concentrating intently on success criteria, you can more quickly begin to deliver to the new demands of the customer. There are great rewards for those that can react and commit to a strategy and roadmap quickly.