Mike Plimsoll, Financial Services Marketing Director, Adobe EMEA
With challenger banks, remittance companies and insurance providers taking a stronghold in the market, the financial services industry is being disrupted. From Monzo and its instant bank balance updates through to TransferWise’s low-cost transfers, or Vitality linking fitness tracker data to insurance premiums, a wave of fast-growth businesses are breaking through with customer-centric operating models. For the industry, it’s come to mean that customer experience is the new brand currency.
It’s not just these fast-growth businesses that are disrupting the CX status quo – the Revised Payment Services Directive (or PSD2) is shaking things up even more. Having come into play at the beginning of 2018, PSD2 prevents customer data from being exclusively held by banks and financial services companies. Instead, other companies can now request access (provided the consumer has given their permission). Their data monopoly has come to an end, and customers, whether business or consumer, are increasingly able to engage with third-party companies when carrying out financial transactions.
With banks forced to open their APIs to other companies, we may soon see internet giants such as Google and Facebook facilitating P2P transfers, advising consumers on where to invest, or how they can reign in their spending. It’s brought customers a sense of relief as they have access to digitally enabled experiences commonly seen in other industries.
Each and every device
The financial services industry is well versed when it comes to mobile. In fact, according to research from the British Bankers Association, customer use of banking apps soared by 356% between 2012 and 2017. While mobile has become the platform of choice for many, there’s a new wave of devices that the industry must take note of: voice-enabled assistants.
Data shows that online sales of voice-enabled devices have grown by 103% year-over-year. This rapid uptake shows that voice interfaces have the potential to change how we engage with each other in the same way mobile did. But banks must start thinking about how they deliver standout voice-driven experiences to remain competitive. A number of banks are already moving ahead – for example, Barclays is offering integration with Apple’s Siri – but these integrations must become commonplace as consumers will, and already are, demanding to use voice instructions to carry out all manner of transactions.
They’ll want to ask Alexa, Siri, Bixby or Cortana to check their bank balance, see how much they spent at the weekend, split bills with their friends, or even invest in shares. It’s crucial that banks offer a capability on these platforms, so that consumers receive a convenient service. And, as consumers introduce a range of different platforms into their lives – such as Alexa-powered speakers, and Siri-enabled phones – banks must ensure that their services work fluidly across them all, and remember these consumers from device to device so that they receive a singular and unified experience.
Taking the in-branch experience online
For the most part, retail banking has made a sizeable shift from the high-street to online. While certain parts of the in-person experience are harder to replicate, born in the cloud fintechs don’t have these legacy services restricting them. This means retail banks need to ensure that consumers can carry out the same functions on a device as they can in-branch to compete. This could include enabling customers to speak with a mortgage advisor remotely on a tablet, offering a chatbot service for customer service, or verifying IDs for credit card applications via a smartphone camera. The more frictions banks can iron out of their service, the better they’ll be prepared to combat emerging fintechs in the age of PSD2.
Of course, these online experiences need to be bridged with the physical world. And the in-branch experience is something that retail banks can use to their advantage. Just look at Metro Bank, which offers customers walk-in appointments, and has in-branch tech that enables any customer to walk out with a fully functioning bank account in 20 minutes. It offers the convenient customer experience that consumers expect online, but with the comfort that can only be gained from in-store.
But Metro Bank takes it one step further – visiting customers get free treats for their pets and are even reimbursed for rehoming a pet from Battersea Dogs and Cats home. It’s the pinnacle of customer experience, as Vernon Hill, CEO of Metro Bank, says “Customers think that if we take care of their dogs then we will also take care of them.”
It’s no secret that banks are sitting on a lot of customer data. It’s a goldmine of insight, that they can use to provide a first-rate experience that’s personalised to each and every customer. Implementation of Artificial Intelligence (AI) plays a key part here, as it enables banks to effectively use this data to create tailored offers for customers, and deliver that much needed and anticipated value added service.
For instance, if a customer has a sum of money in their bank that could be suitable for a housing deposit in the area they live, banks will be able to send the customer mortgage offers that lay out how their monthly payments would compare to the monthly rent payments they are currently making. Or, if a customer is frequently sending money to or receiving payments from another person, banks can use AI to determine their relationship, and if suitable, send relevant offers for joint bank accounts.
Of course, banks will need to be respectful of customer data when targeting in this way, by offering opt-ins and the right-to-be-forgotten – all of which are taken into account with the upcoming implementation of the General Data Protection Regulation (GDPR). If banks can provide personalised offers that are relevant and useful, customers will view their data as a small price to pay for a first-class experience.
This is just a drop in the ocean in terms of what AI will enable banks to do. By providing offers and financial advice to customers before they anticipate the need for it, banks will become more of an everyday service than a utility, and true champions of customer experience.
CX: A top priority
The good news is that customer experience is already a big focus for banks, with research from analyst firm, Econsultancy, revealing that customer experience was the single biggest priority for two-thirds of financial marketers in 2017.
The question lies in how far banks can change now PSD2 is in force. Whether they are looking to offer voice assistant capabilities, use AI to offer contextual offers, or provide more innovative experiences in-store, the sheer size of traditional banks means they will have a harder time of shifting their customer experience strategies than agile fintechs will. To fend off the competition, it’s essential that they do. The customer experience wave is coming, and every single bank needs to get on board. We’ll be exploring this further at Adobe Summit 2018, where I’ll be joined by digital leaders in the financial services industry who are already shaking up their customer experiences in line with PSD2. You can find out more, here.
- Mike Plimsoll is Financial Services Marketing Director, Adobe EMEA. He helps Adobe’s financial services customers, such as RBS and Barclays, to create competitive customer experiences that contend with disruptive challenger banks.