Jim Marous, The Financial Brand | USA, Partner, The Financial Brand Publisher, Digital Banking Report
Jim Marous is an internationally recognized financial industry strategist and the publisher of the Retail Banking Strategies section of The Financial Brand. He specializes in developing innovative, multichannel solutions that drive revenue through acquisition, engagement, expanding share of wallet and retention for the financial services industry. He has helped to successfully launch new products and services as well as build and reinforce existing products and brands.
What do you find to be the most important factor in order to improve the relationship with the customer 3.0?
Customer 3.0 doesn’t compare your bank to other banks, they compare to your products, channels and engagement with retailers and online firms that are more advanced in the capture and use of insight. Customer 3.0 requires an engagement that is simple in design, powerful in functionality and contextual in engagement. They expect their bank to know them, look out for them, make their life simpler, be proactive based on solution recommendations and reward them for their loyalty. The goal for any firm trying to acquire and/or retain customer 3.0 is to be ‘home page worthy.
What impact does the customer 3.0 have on the banks and what is the greatest challenge he poses to the banking industry?
Customer 3.0 is a digital consumer that is not defined by traditional demographics such as age and income. Not all of the Gen X and Y consumer base is part of the Customer 3.0 segment and not all of the Customer 3.0 segment is Gen X and Y. The challenge with Customer 3.0 is that they are well ahead of the majority of financial institutions with regard to their understanding and use of mobile and digital channels. They are more demanding and will not accept a miniaturized version of online banking as an acceptable mobile platform. They don’t want banking as a separate app as much as they want banking to be integrated into everything they do. As opposed to providing everything within a banking app, they want simply ways to perform basic functions. Like mBank’s 30 second personal loan, they value ease of use and speed of solution above all else.
Lately, there has been many new regulations introduced to the banking industry. Which one of them do you think is the most challenging to cope with for the banks?
As opposed to a single regulation, the most challenging component of recent compliance changes is how financial institutions can respond to regulations without slowing down internal and external functions. Most institutions let changes in regulations become an ‘excuse’ for not moving forward or not providing an exceptions customer experience. The winning organizations find ways to remain compliant while improving their internal agility and external customer experience. Regulations will only become more stringent. The winning organizations will be those that can respond to these new rules proactively and find a way to use them to their favor.
What do you predict to be the top 5 retail banking trends of 2015?
In no particular order, these are the trends I hope will occur in 2015:
1. Increased contextualization of digital banking, leveraging geodemographic ‘big data’ to deliver offers and solutions to consumers where they are, when they need it, using the channels they prefer.
2. Continued emergence of solutions from outside the financial services industry that challenge bankers to rethink banking. In conjunction with the emergence of new players, there will be an increase in the acquisition of non-financial solutions by banks.
3. The realization that moving into the future with a foot in the past is not possible. More banks will invest in the transformation of their back-office core systems. There will also be the realization that branches must be digitized, shrunk and closed to better meet the needs of tomorrow’s consumer.
4. Continuation of the breakdown of internal silos of data and products. Until we can truly get a 360 degree view of our customers we can not serve them effectively.
5. The emergence of the data officer within the marketing function. Instead of data and marketing working in different functional areas, the application of consumer insights by marketing will require a growing number of data-savvy marketers.
Why is the interest in retail banking continuously growing?
The interest in retail banking is growing because it is so competitive. It is competitive because we are not effectively meeting the needs of a more demanding consumer. The demanding consumer is emerging because other industries are educating them as to the potential of digital and mobile capabilities. Other industries are becoming more agile and responsive because of the ability to capture and use structured and unstructured data to proactively determine needs. The use of big data is taking place because the cost of processing and the technology available to process is becoming available to all sized organizations. In other words, the ability to process data effectively and efficiently by other industries has enabled more agile and responsive industries to educate consumers on the potential of just-in-time insight and marketing, putting pressure on retail banking to do the same.
Do you think the channel integration has reached the point where it has become totally seamless?
Unfortunately, no. The challenge is that banks have come to believe that being able to everything on every channel is a benefit to the consumer. Their response has been to provide all of the same functionality on all channels and believing that the customer is happy. In reality, the consumer uses different channels for different reasons. I don’t need to access my entire investment portfolio on my mobile device, but I do want to see balances and receive alerts immediately (usually without login). Seamless channel integration will occur when I can perform the functions I want with the fewest steps without going through multiple pages on my mobile device or online channel. In fact, I don’t want my tablet and mobile functionality to be the same.
What do you think are banks‘ areas for improvement and what should they focus on?
1. Simplify every common task to the most basic level. How can I do my everyday functions with the fewest steps with a simple design?
2. Contextualize my banking so it reflects who I am, my relationship with the bank, my financial lifestage, my goals, in addition to what I am doing at any moment and where. Become the Amazon of banking.
3. Build engagement with customers so that they will use your services more frequently. Become part of their everyday life.