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Retail Banking

In retail banking, digital technologies are eroding traditional advantages and opening the door to new competitors. Our retail banking consulting teams help clients master the skills they need to remain relevant to their customers.

Retail banking players have struggled with unsustainable cost structures and shrinking revenues for years. With customers now moving to digital channels more rapidly than ever, nonbank insurgents making deeper inroads in distribution, and both online and mobile banking use soaring, banks must meet ever-evolving customer needs with a new sense of urgency.

To safeguard their relevance, retail banks must redesign their solutions and operations. BCG helps its retail banking clients meet this imperative and achieve impressive results.

Our Approach to Reimagined Retail Banking

BCG’s banking consulting experts bring a proprietary suite of proven solutions and powerful tools to every engagement, including the following offerings:

  • Front-to-Back Journeys. We help our retail banking clients define and execute a cohesive set of digitization initiatives aimed at improving the customer experience, overall efficiency, and the effectiveness of controls. Front-to-Back Journeys address both the customer journey and the bank functions that design and deliver that journey. It combines customer-engagement, channel, and product improvements with technology and operational measures—all utilizing cross-functional, agile ways of working. Banks deploying this solution have reduced costs by 20% to 30% while simultaneously lifting their net promoter scores by 20 to 30 points and enhancing revenues by 5% to 10%.
  • Retail Analytics. Our retail banking consulting teams partner with banks to capture customer loyalty and cross-selling opportunities, as well as to overcome challenges such as decreasing use of branches and increasing customer churn. We use analytics to identify precise signals from customer data. Banks can then craft messages that target specific customer needs, build a marketing operations engine to manage and deliver multichannel messaging, and manage ROI. Banks using our analytics offering have boosted sales through next-best solutions by 30% and reduced customer churn by 5% to 10%.
  • Digital Bank Accelerator. Multidisciplinary BCG teams help our retail banking clients build a digital bank to better meet their customers’ needs; for example, by providing more personalized and instant services. We combine retail banks’ traditional strengths—such as trust, security, and a wide product range—with the advantages of digital technology, including easy-to-use, convenient, and constantly upgraded services. Our clients have improved their cost-to-income ratio from 50% to 30%, boosted digital customer acquisition and sales from 30% to 90%, and increased straight-through processing from 40% to 80%.
  • Bionic Distribution. Our retail banking consulting teams help clients optimize their branch networks to reflect new realities, including the rise of hybrid customer journeys, which combine face-to-face and remote elements as well as branch staff working both within and beyond the walls of the branch itself. Drawing on tools such as our network footprint optimizer, we help clients determine how many branches to operate, as well as where to locate them and in which formats, including which relationship-manager shifts should be virtual versus physical. This disciplined approach has yielded pre-tax profit improvements of up to 40%.

Our Insights on Retail Banking

Meet Our Retail Banking Consulting Leaders

BCG’s retail banking consulting experts operate around the globe. With each engagement, they bring long-time experience and deep knowledge of topics including retail banking strategy, digital disruption in retail banking, operational resilience, retail analytics, AI at scale, and radical cost management.

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