The need for bank branches may be dwindling, but human interaction is still vital, so JPMorgan Chase is investing heavily in technology to foster such interaction with customers – albeit online.
Its Chase retail unit has been rolling out a redesigned version of its website, including what the bank's team calls "the conversational area." This area, visible at the top of the screen throughout the site, includes alerts the user can respond to without navigating to another page, and a search engine that spits out answers to customers' questions.
"We think of this as something connected to the way we have a banker relationship at a bank," said Tim Parsey, head of digital customer experience at Chase. "Here's this advice, this support, this guidance that's always there for you."
The site redesign shows how even as the industry becomes increasingly digitized, bankers expect consumers will still want to be able to reach a human being about questions or problems.
"Whether it is a customer crowdsourcing an answer from other customers, or official customer service reps conversing with customers, technology is enabling human interaction – in new ways – rather than eliminating it," said Nick Clements, co-founder of MagnifyMoney, a comparison-shopping site for consumer financial products.
While technology and innovation take money – JPMorgan Chase's technology budget is $9.4 billion for 2016 – it also affects the bottom line in a positive way, largely through expenses. Digitally centric customers, defined by Chase as those who visit a branch or talk to a banker no more than once a quarter and conduct three digital transactions a quarter, cost the company half of their analog counterparts, Gordon Smith, the chief executive of consumer and community banking for JPMorgan, said last month at the company's investor day.
But Smith and other executives were careful not to make the commitment to digital improvement solely about expenses. Instead, they say digital customers are more proving to be more loyal. Essentially, the better the experience the bank can create digitally, the better relationships it will have with its customers.
"Gordon showed a slide that naturally [digital banking products] create some efficiencies as far as a cost to serve," Barry Sommers, CEO of consumer banking, said at the investor day. "But the real driver of mobile technology for us is that it also significantly increases the opportunities we have with these customers. [They are] about 40% more likely to choose us as a primary bank when they lead with a mobile log-on."
The new Chase site has gone live to about 1 million customers and follows the company relaunching of its home page in July 2015. Chase expects that number to rise to 4 million by the end of the month and 33 million by the end of the year.
"Simple," "personal," "human" and "cohesive" are words the digital team likes to use to promote the new user experience and interface, but it is more complicated than that behind the scenes, Parsey said, since customers have different types of accounts and levels of functionality.
In creating the new site, the Chase's developers changed the way they approached their work. They moved from a "waterfall" methodology, where the development process begins with requirements and flows from top to bottom, to an agile one, where development comes from collaboration between cross-functional teams.
"You aren't trying to build the pieces and bring them together," said Jason Alexander, Chase's head of digital platforms. "You start with the whole and then break it into pieces."
The team works in three-week sprints, Alexander said – executing three weeks' worth of site improvement, demonstrating it, then another round of improvements.
Chase is renting 125,000 square feet of Manhattan real estate and has created a facility that tries to recreate the culture of Google; employees can literally write ideas on the walls. The office is staffed with a digital team whose executives largely are experts new to the banking industry.
The space boasts video walls, phone booths with telepresence and a usability lab, where designers can test new products with customers. Music plays in common areas, but there are "huddle spaces" for private conversations and quiet zones for those that need them to focus. The more than 700 employees working there enjoy a meditation room, game den equipped with a foosball table, electric guitar and video games. The employees get around on scooters throughout the office. There is a culture committee designated to plan employee events and activities there, including hackathons and meetups.
The bank says the team is focusing on customers before sales. If so, that would be a departure from long-standing practice in financial services. Clements, a 15-year banking veteran, says the industry has traditionally viewed the digital channel as simply a way to push products while cutting costs and using tech resources in India.
"There would be regular internal battles on who would get access to precious home page real estate," he said, "with the goal of selling, selling, selling."
Of course, Chase's aim is to get customers into new products easily. It's just using newer measures of return on investment – engagement and cross-selling.