In a recent blog post, I discussed my belief that in today’s increasingly mobile, connected world, banks are finding themselves facing a ‘perfect storm’ which will necessitate a complete change in their approach if they are to continue to survive. Interestingly, this was one of the key topics for discussion at the recent Retail Banking in Europe conference in Brussels, where we saw a great deal of debate around not only how banks are going to embrace this brave new world of innovation, but also some of the challenges they face in doing so.
Put simply, banks are still struggling to come to terms with new, technologically enabled customers, and it’s clear that many still view things like social media with a degree of suspicion. Although it’s some see social as just another communication channel, it’s important to recognise that for financial institutions of all shapes and sizes, social tools can open up a new way for customers to interact with them, and can, in turn, offer a new way of building relationships with customers.
Increasingly, as more and more customers become used to consumer brands building relationships through them via social channels on their mobile devices, the challenge is for banks to break out of their silos and look for ways they can make this strategy work for them. Of course, the danger here is that if the big, established banks do not move fast enough, then it leaves the market wide open to new entrants, including not only newer, more innovative banks, but also forward-thinking companies like Google, PayPal and Amazon, all of who are chomping at the bit to attract new customers by offering an improved customer experience.
Nonetheless, it’s worth bearing in mind that although companies like Google might well be established on the internet, it doesn’t necessarily mean they will automatically dominate the mobile world. Where mobile is concerned, it’s clear that there’s still room for maneuver for banks who are willing to play a major role in the way consumers interact with financial services on their mobile phone.
What this effectively means is that we could see an end to static segmentation of banking customers, as brand loyalty diminishes and more consumers look to step outside their traditional market segments to find a banking partner that suits their needs. With this in mind, it’s clear that banks must find a way to offer new, flexible products, which are designed to address this new breed of fickle consumer.
Perhaps the easiest way to achieve this is through investing in what I call ‘tell me when’ mobile solutions which not only allow customers to manage their money on the go, but also provides them with advanced real-time notifications. These can take into account the context the customer is in at any given time to alert them to when milestones are reached, such as when they are close to or have just gone overdrawn. These new solutions can alert consumers not only to risks, but identify revenue-generating opportunities as well, and can point customers towards targeted deals offered through strategic partnerships.
Ultimately, mobile commerce combined with these ‘tell me when’ apps will enable consumers to use their mobile phones for a highly enhanced shopping experience, and will allow them to make mobile purchases from an advert, a billboard, magazine, or a TV spot. They will also increasingly be able to get offers in real-time, and use special offers, digital receipts, loyalty coupons and vouchers on their mobile devices.
Of course, the challenge for banks will be to find a way to achieve all of this in an interesting, cost-effective way, but it seems clear that if banks are to appeal to the new breed of technology-savvy consumer, then they must learn to adapt. If not, the ‘perfect storm’ could quickly precipitate an unwelcome flood, which could see retail banks as we know them, sinking for good.
View all posts from Bart Schouw on the Progress blog. Connect with us about all things application development and deployment, data integration and digital business.
Subscribe to get all the news, info and tutorials you need to build better business apps and sites
You have the right to request deletion of your Personal Information at any time.
You can also ask us not to pass your Personal Information to third parties here: Do Not Sell My Info
We see that you have already chosen to receive marketing materials from us. If you wish to change this at any time you may do so by clicking here.
Thank you for your continued interest in Progress. Based on either your previous activity on our websites or our ongoing relationship, we will keep you updated on our products, solutions, services, company news and events. If you decide that you want to be removed from our mailing lists at any time, you can change your contact preferences by clicking here.
Let our experts teach you how to use Sitefinity's best-in-class features to deliver compelling digital experiences.Learn More