Many bank customers have specific and unique circumstances and requirements but they frequently feel out of touch with existing products. Often, these products are confusing and misaligned to these needs. But every customer wants to feel special, understood and supported without the need for them to study all of the bank’s products, how the bank is segmented or structured. Customers want fit-for-purpose solutions to their financial needs.
Historically, the most complex and tailored products were primarily reserved for the largest of corporates and financial institutions. But there is now an increasing need to bring the innovations to smaller and mid-size corporates. We see a growing divide in channel segmentation models, with many banks focused on tackling their cost base through relatively crude segmentation models – typically turnover based. This drive to digital, whilst critical for day-to-day banking needs, may not provide customers with the expert support they need in key ‘moments of truth’, many of which will be triggers for a new product or service offering. Our view is that the right answer is more nuanced and requires a more dynamic form of segmentation based on changing needs—one that enables banks to spot the triggers and respond proactively with an offer. With more and more niche digital competitors driving this form of engagement, we believe that bridging vanilla digital offerings with an integrated channel strategy is critical for established banks to protect their market share.
Clearly cost-to-serve is a critical consideration, with modern and emerging technologies providing a new means through which to offer these capabilities. The key question is: How can banks refocus their new business and technology-enabled models to drive loyalty across the customers they really want to be nurturing?
New advances in technology allows banks to demonstrate their understanding of individual customers and work with them to provide specific solutions to address their particular needs and truly take them to new heights.
- Banks need to become data led by using the wealth of information and genuine customer intelligence. We encourage banks to break through the existing product silos and organisational structures to allow bespoke tailoring to benefit the customer, as well as the optimisation of the banks resources and risk management framework
- Banks should look to pivot away from clients having a relationship with an individual at the bank to having a relationship with the bank itself. The role of the relationship manager is not dead, it just needs to evolve to focus on having the right client interactions in order to maximise the value they provide and build genuine trust
- Banks need to think of the end-to-end journey with the customer, aspiring to support the customers ambitions and needs before they even realise they had them. Using existing experience and knowledge, banks can customise their approach to enhance their solutions to support across sectors, age brackets, locations, maturity and growth.
The key enabler to all of this is the ability to genuinely understand customers through dynamic use of data.
If you would like to find out more about how we can help with your customer-focused journey, please contact Simon Gray.