By Christopher Young
THE old guard of the financial services industry is increasingly under attack by the modern forces of the digital era.
A study from Ernest and Young revealed that 66% of banks in Malaysia will reach digital maturity by 2020 however, one of the biggest gaps in defence is customer experience.
Large tech giants like Apple and Amazon, who have customer experience well in hand, are now entering the financial services space — as are new fintech companies with a narrower offering within the financial services value chain, but with an intense focus on the customer experience.
These new players in the industry are already having an impact, especially when it comes to raising the bar of consumer expectations.
More than ever before, consumers want to receive exclusive discounts on products and services, to have their issues resolved quickly and hassle-free, and to receive relevant and useful information, such as a notification when rates drop so they can refinance.
Adobe conducted a research in partnership with Ovum of over 300 financial services and insurance firms across US, Europe, and APAC, and found that rapidly changing consumer expectations were seen as the most disruptive force within the industry, with as many as 65% ranking it as a top disruptor.
To shore up their competitive defences and address the need to be a customer-centric organisation, financial services companies should be looking at how quickly they can meet demands for more convenience, personalisation, and real-time information.
But many challenges stand in the way. Some of the hurdles these companies face are engaging across all channels with relevant personalisation (55%), breaking down internal silos (51%), and the lack of integrated and shared data across the enterprise (46%).
Of the companies surveyed, only 8% are leaders in digital transformation while 58% are in still the early stages or have not started. Luckily these firms are planning to invest in digital marketing and the customer experience, and they can learn from other leaders that are further down the path.
From our research, six essential traits emerged for digital leaders in financial services.
Here’s what they are, and how these characteristics are helping them succeed amidst today’s challenges and disruptions:
1) They empower employees to respond to customer needs
Customer experience management platforms that enable end-to-end employee and customer engagement can unlock transformational opportunities.
Employees are supported by the necessary technology to fix customer issues rapidly and as they happen. This requires near real-time information and a fully integrated system that allows employees to connect, communicate, and cooperate.
2) They are adaptive and experimental
Enterprises that want to promote connectivity between their employees and customers need to become more agile and innovative. This requires the adoption of customer-centric thinking and a culture that encourages experimentation and new ways of working across the entire enterprise that can bridge divides and foster collaboration between departments.
3) They have reorganised around the customer
Achieving customer-centricity requires organisational shifts within the enterprise around the customer. Teams must become responsible for end-to-end journeys, not fragmented handoffs.
To do this, teams must now consist of cross-functional disciplines — from marketing to HTML coders to compliance — that can collectively solve problems faster.
4) They give data a front seat in the transformation
Not only are the tech giants encroaching through experience but also through data. It’s important for the financial services industry to maintain its superiority over financial behavioural and transactional data.
Digital leaders are harnessing the data they already have through investments in machine learning and artificial intelligence (AI) to compete more effectively.
By 2021, Artificial Intelligence will allow the rate of innovation to almost double (1.8x) and increase employee productivity improvements by 60% in Malaysia, according to an AI study put forth by Microsoft & IDC-ASEAN Research Group.
5) They invest in the power of AI
AI is transforming customer engagement by automating ways to create meaningful 1-to-1 interactions at scale.
AI-powered conversational interfaces can handle a variety of basic banking tasks that can replicate the human experience of interacting with a bank representative.
The technology used, data collected, and the ability to deliver the conversational experience that customers expect will determine how successful firms can be.
While seven in 10 business leaders polled agreed that AI is instrumental for their organisations competitiveness, only 26% of organisations in Malaysia have embarked on their AI journeys.
Those companies that have adopted AI expect it to increase their competitiveness by 2.2 times in 2021.
6) They meet the tech expectations of millennials and Generation Z
Digital innovation is the norm for younger generations, which means they expect simplicity and no barriers when interacting with brands, researching a product, or opening an account.
It is essential for firms to remove friction from the process and use technologies, such as mobile and voice assistants, that will provide them with effortless and convenient experiences.
Financial services companies will continue to face disruption, but those that embrace the traits required to deliver exceptional experiences can still win the customer experience battle — and emerge as a leader. – Nov 8, 2020
Christopher Young is the director of industry strategy and marketing for Adobe’s Digital Marketing Business.
