Banks need to follow the research and development model used in other industries like high tech and pharmaceuticals, which place bets on lots of different startups and experimental technologies to stay ahead of possible consumer demands.

That was the overriding message at SourceMedia's Digital Banking Summit this week.

"The environment is changing so rapidly," said Brett Pitts, executive vice president and head of product management for the digital channels group at Wells Fargo & Co. "Consumers are leading us."

Indeed, AlixPartners recently found that 60% of smartphone or tablet owners who switched primary banks reported mobile banking capabilities as "important" or "extremely important" to that decision.

City Bank Texas and BBVA are seeking out entrepreneurs to help them innovate.

"We are not afraid to work with folks that are sitting in the garage," said Jim Simpson, senior vice president and chief technology officer at City Bank Texas. The Lubbock bank was one of the first financial institutions to let customers turn their debit cards on and off via a mobile app.

BBVA Ventures, the division of BBVA that bought digital banking interface Simple, is also on the lookout to find more tech partners to strengthen areas where the bank is weak.

"We realize we can't do everything ourselves," said Jay Reinemann, executive director at BBVA Ventures. "We need different types of talent and different types of products to satisfy customers."

Banks also need to constantly improve their apps to catch consumers' eyes.

"Mobile used to be a retention play," said Niti Badarinath, senior vice president and head of digital strategy and mobile banking at U.S. Bancorp, whom Bank Technology News named Digital Banker of the Year this week. "Now mobile has become an acquisition play."

U.S. Bank is constantly investing to improve its customer experience — for one thing, by using the mobile device's camera and imaging technology in creative ways to reduce data entry. The bank already offers mobile bill pay, deposit capture and credit card balance transfer through the smartphone camera and imaging software. Those won't be the last of the image-related tools the Minneapolis bank rolls out.

"What was delighting someone a year ago is now in the [expect] stage," he said, citing mobile deposit capture as an example. "[Customers] move from 'wow, this is innovative' to 'why don't you have it.'"

Companies outside of the banking industry are establishing a large portion of customer expectations.

"We are competing with every other app on your phone," said Badarinath, whose bank team meets with Silicon Valley tech companies to better understand their business models.

One newer app trend involves giving consumers relevant information before they have to ask for it. The industry should look at Google Now for inspiration in how to anticipate customer needs, advised a number of banking execs.

The Google service aims to serve consumers information before they even know they want it, including but not limited to, reminding someone of an upcoming bill payment based on their emails. Likewise, a bank could push relevant info to opted-in customers, such as an offer or a bill payment reminder, before they request it. Think of the updated app as a data-driven assistant.

This focus on serving the customer digitally does not leave physical branches out, many at the conference said.

"In a lot of cases, customers want to self-serve within a physical environment," said Pitts. That behavior is reflected in the design of Wells' newer stores in the D.C. area. The branch models include ATMs that can dispense $1 and $5 bills and so-called universal employees who can just as easily demo mobile deposit as sign someone up for an account.

Bankers also envision a branch — ATMs included — that better works with mobile apps so that a customer could pre-stage a transaction, for example, or the banker could know who walked through its door using location tech linked to the mobile phone.

To find what works or what takes off in the way the iPhone did, banks will continue to test tech and ask customers what they want.

Banks like Westpac New Zealand are crowdsourcing mobile app ideas and soliciting customer feedback by, among other things, adding a white box to every email as an avenue to draw out customer wish lists, for example. Then, Wells is trying out an app for Google Glass while U.S. Bank is piloting a mobile commerce app called Peri.

What will take with consumers remains an unknown — and bankers are some of the first to acknowledge the limitation and the need to keep trying. 

"I don't know how it ends," said U.S. Bank's Badarinath. "The cost of just moving is less than just sitting and waiting for the right time."