Some people still enjoy waking up early on a Saturday morning, wear comfy clothes and go shopping. Walking from one store to another, wandering around, trying on clothes, considering the options, talking to a sales person.
And at some point, with tired legs, to take a well-deserved break for lunch, hopefully holding bags with new purchases and satisfaction. But this scenario has become increasingly unusual. There's no doubt technology is deeply affecting the way we buy.
In this digital world, most consumers research their purchases online, whether they want a pair of sneakers, a holiday package, or opening a bank account. And that means the process of making a decision—the so-called buyer's journey—has changed. She no longer is persuaded by an attractive window display, slick advertising or a pleasant salesperson.
Firstly, the buyer can change channels at the flick of a button, so if a product or services website is too slow, or cumbersome, or irritating, she will move on. Google said as far back as 2011 that digital channels, from social media to navigating the web, have accelerated the process of making a decision to the point that Google called it ZMOT —Zero Moment of Truth.
Shopping that once took hours or even weeks, now takes a few minutes, even a few seconds. And if the consumer is not immediately convinced, she is gone before you know it.
Trying to hang onto today's customers is like trying to swat a mosquito. Buying is no longer a customer journey. It's a quick flit in which the well-defined stages of buying are condensed to a few seconds.
At the Financial Brand Forum in early 2019, Google elaborated on this concept by having a social anthropologist, Abigail Posner, explain the importance of understanding the relationship of the customer to their digital space, and not necessarily to the product. The theme was that technology is not there to help businesses do things as usual but simply faster. Instead, to reap its benefits, users need to change their mindset and start taking an approach that requires almost constant analysis, assessment and adjustment in order to be efficient and effective. Instead of concentrating on the benefit to the business, Ms. Posner insisted that the focus should be on having a better understanding of the customer, because only by humanizing and personalizing the digital experience it will be possible to capture a customer before she flies off to another service provider.
How is this affecting banks and FIs?
In banking, this is almost a full circle. At one time, everybody knew her bank manager and the bank manager knew all her clients. Then digitization came in and the customer and the manager became equally faceless, just digits on a screen that never met, never communicated. Now it has come full circle and data analytics, AI and machine learning are allowing banks to “know” their customers again, in a highly personalized and individualized way. Instead of leveraging this mass of data to increase the number of transactions as the main objective, the savviest banks are using this information together with new tools to develop better products and provide their customers with a better—more human and personal—experience, an approach that is intended to guarantee an increase in customer attraction in a rapidly morphing banking industry.
Unfortunately, according to the Digital Banking Report 2018, only 6% of financial institutions are actually using advanced personalization technology. Most banks are still operating at the transactional level and no more. They are not listening to their customers. The 2017 Global Consumer Pulse Research showed that 48% of bank customers expect special treatment for being a good client and that another 33% had changed financial service providers because that personalization was lacking. That same research also showed that there were still gaps between expectations and delivery, as well as failure to understand what matters most to some clients.
All financial institutions, big and small, already hold a great amount of data on their clients. The new tools—predictive analytics, AI and machine learning—allow banks to respond to their customers in real time and to be both relevant and personal in their approach.
Why would any bank or FI be satisfied with less when all the research indicates that the customers are demanding approaches that will provide the best possible digital, personal and contextual experience every time?
It’s about being there for the clients and, just like in the good old days, aiming for a smile with every interaction. How? We can help you out...