2024

Digital Transformation: What’s Next for Australian Banks?

KEY STATS AT A GLANCE

• 73%: Nearly three-fourths of respondents admit that evolving customer expectations have highlighted weaknesses in their organization’s current customer experience.
• 64%: Nearly two-thirds believe their firm’s legacy systems and infrastructure are hindering them from providing the digital experiences their customers expect.
• 56%: Over half cite data monetization as their company’s number one priority over the next three years.
• 21%: Roughly one in five Australian banks have a fully agile operating model.

Top Priorities for Digital Business Transformation in Australian Banks:

• 23%: Enabling greater agility
• 19%: Improving the customer experience
• 13%: Acquiring new customers
• 12%: Improving cybersecurity
• 11%: Growing revenue with new products and/or service offerings
• 9%: Growing revenue from existing products
• 7%: Reducing costs through improved efficiency
• 7%: Challenging the threat posed by new market entrants (e.g., Google, Apple, Amazon)

Main Barriers to Digital Transformation:

• Lack of Budget: 41% cited the lack of budget as the main thing holding their digital transformation back.
• Lack of Access to Data: 41% said that lack of access to data is their primary digital transformation barrier.
• Regulatory Challenges: 33% indicated that regulatory challenges are their biggest barrier to digital transformation.

Australian Banks Are Focusing on Customer Centricity

Banks are aiming to use data to create new products and services that deliver more personalized omnichannel experiences.

• 45% are prioritizing omnichannel services to advocate for customer experience (CX) transformation by making products seamlessly available across channels.
• 43% state that making personalized customer journeys—such as tailored marketing and personalized savings tips based on individual spending habits—is their top CX transformation priority.
• 41% said that developing new or nontraditional financial products and services (e.g., travel booking) is their key strategy for improving customer experience.

Australian Banks Want to Become More Agile

Banks are transforming to survive in the customer-centric digital era, but access to data, talent, and the right technology and platforms remains a challenge.

• Generative AI: 37% said that investing in generative AI for internal use is their top priority for operational transformation.
• Developing Talent: 35% are investing in developing existing talent (e.g., upskilling, reskilling), while 32% are focusing on developing new talent (e.g., hiring digital skill sets).
• Modern Cloud: 31% are focused on building modern cloud-based core banking systems.

How Do Australian Banks Think They Stack Up?

• 59% think they’re ahead of their competitors when it comes to their ability to transform customer experiences.
• 90% think they’re ahead in key development areas.

AI Is Now in Play

Banks in Australia see the potential of AI technologies to boost digital transformation.

• Custom-Made AI: 75% believe developing custom-made AI tools specific to requirements is more important than a faster rollout that could be achieved by using available third-party solutions.
• Investment: 31% of banks’ customer experience digital transformation investment will be prioritized for machine learning, AI, and generative AI.
• Digital Natives: 73% admit their firms must do more to appeal to digital native customers.

Internal Uses of Generative AI Are the Focus—for Now

Over half (55%) of banks are pursuing employee- and internally-focused use cases, such as marketing, customer service, communications, PR, customer apps, and more.

For more information:

Tales Lopes
Managing Partner, Financial Services
tales.sionlopes@publicissapient.com

©2024 Publicis Sapient Corporation

For a global perspective and more data from banks around the world, access our Global Banking Benchmark Study for insights from more than 1,000 global banking leaders.

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