Today, despite the level of disruption, digital is only in its early days as mobility, analytics and agility fundamentally change the relationship between companies and their customers. The world of tomorrow is about connections. Individuals will find themselves interacting with hundreds of devices as they go about their daily lives. Everything from security cameras, home appliances, traffic sensors, healthcare devices, navigation systems, ticketing systems, payment systems and even vending machines. Financial services organisations need to consider what a successful company will look like in the future and how digital disruption can be exploited.
Major companies mistakenly assume that they are being digitally disruptive when implementing new technology portfolios or using tools such as online platforms, social networking, predictive analytics and cloud. This is not enough. Using new technology does not automatically result in digital exploitation. First, you need to reimagine your business and meet the demands of customers living in a digital world. Then you need to predict behaviours.
Digital innovation has given birth to a new customer journey. It is transforming the way people interact, transact, learn and handle their finances. Companies increasingly find themselves in a situation where the customer is in control. So much so, that customers are directing and designing their own customised experiences. The digital customer cares about four things; convenience, simplicity, speed and insight. Customers want 24/7 access to services, response to any queries in real time and meaningful dialogues with the brands they interact with, across multiple channels and interfaces. They demand hyper customisation and are increasingly in control.
The Millennial population are a good example of individuals who from a young age have grown up using a smartphone and tablet. What started out a tool to make phone calls when out of the house or office, is now something much more as the millennial population intuitively make all their important decisions online. Mobility infrastructure has expanded and diffused to the point where almost everything is connected to a network. For Millennial customers, bank branches need to offer more than just financial advice for the visit to be worthwhile. Technology is also uncovering new un-banked and under-banked communities.
Banks are now finding themselves focusing their efforts on retaining customers and building brand loyalty whilst also competing with traditional institutions, challenger banks and non-traditional players from sectors as diverse as transport (e.g. Uber), retail (e.g. Amazon) and technology (e.g. Apple, Google, Facebook). Financial services companies must respond to customer needs quickly or risk losing to these smarter entrants.