Digital: serve better, not just serve more
Which is your favourite mobile app? HSBC was the answer, writes Anshuman Singh
We posed this question to a group of attendees from Retail, CPG & Retail like companies. As the CIO elaborated on his answer he said that it was the only app on his phone that was not trying to sell him something. Instead, whenever his son called to top-up his pocket-money, he could do it instantaneously.
You may not agree with the opinion – and may even come as a shock to those who are introducing more cross-sell capabilities – there was a very important message, use Digital to serve better and not just sell more. And this became the theme for our talk at the recently concluded Future of Digital Banking 2015.
Look at most technology initiatives around you, most are obsessed with taking the cost out e.g. ATM’s, Online Banking or selling more e.g. marketing automation, emails. As a business it’s important to manage the cost, but when cost becomes the primary driver, it creates more problems than it solves.
The toilet-roll problem
When you walk into a hotel-room, there are things that you expect and things that delight you. Amongst the things that you expect are toilet rolls. But if there are a dozen of them, would it make a difference? Online banking and mobile app are a lot like that. It’s a must-have and increasingly hard to differentiate upon. When you check-in, if the queue takes 1m instead of 4m, does that make you jump with joy? Walking to the room and opening the room with your phone definitely would. However, if you find your favourite tea in the hotel room (instead of five packs of coffee that you never drink). It delights you. (This distinction of must-haves, performance attributes, and delighters are very nicely summarised in the Kano model).
The question is how do we look for things that delight our customers? You need to look at the core-needs of the customer and not necessarily the business you are in. Looking outside the industry, especially those who are ahead, is always a great starting point.
Can you spot the easyJets of the Banking industry?
15-20 years ago, Internet allowed the Low-Fare Companies to take hold because they could sell directly to the consumer and reduce advertising costs; operated on a model that allowed them to operate efficiently e.g. only served point-to-point (never connections, and therefore no missing bags) or flew to airports which charged less to park. Once they conquered this segment they started to pursue segments with higher margins i.e. business traveler. The same is unfolding in the Banking sector. A large set of Fin-Tech companies are pursuing smaller segments on the market e.g. CommonBond (for student loans), CurrencyFair (currency exchange), Bondora (peer to peer lending/deposits), bankmobile (banking targeted at Gen Y). There’s an interesting infographic doing rounds on Twitter as to how the retail-banking is being fragmented. Can you spot the easyJets?
Three things that you can learn by looking outside
As Rodney Fitch famously said, “Only one company can be the cheapest, everyone else must use design.”
The full-service airlines and hotels are responding by focusing on customer-experience, by looking at how they can help the customer go from A to B. This is significant shift in the way they look at their businesses, the way they collaborate with adjacent industries while still keeping an eye on razor-thin margins.
- Customer Experience – DIY vs. HID (Have it Done): Marriott looked at their customer experience journey from the point people leave home to their return, and how to make it stress free. One of the initiatives they rolled out is ‘Marriott Red Coat Direct’. Red Coats are Marriott Concierges. When hotels host events the guest/organiser is the busiest. As the event progresses, there are a host of requests that need to go to the Red Coat like, Coffee, Water, Lunch to be delayed, room be made cooler/hotter. They created an App that routes these to the concierge and acknowledge on completion. This in turn interacts with a host of systems like the kitchen, housekeeping, engineering etc. The best bit about this is that the customer is at the heart of it. It designed to help concierge serve the customer better
- Not Mobile First, but API First: In most banking conferences you hear about mobile vs. branch debate. In my opinion it shouldn’t matter. The channels will evolve very rapidly. The speed at which Internet of Things is evolving, mobile as a channel might look insufficient in few years. An API First approach may help you isolate the underlying infrastructure from changes in the channel. International Airlines Group (parent company of BA, Iberia and Vueling) have a group focussed on Service Transformation. They are working on exciting ideas like permanent bag-tags (so that you do not need to get a bag-tag and it is not lost) and creating API platforms that expose information like flight times, what is on your inflight entertainment, to the cheapest fare. This allows both the partner network integrate better and, allow exponentially increase the innovation. If your AVIS car-rental needs to be amended because your BA flight is rerouted because of poor weather, it would be relatively easy. The questions is if banks have started to look outside online-banking and explore partnership opportunities to simplify customer’s life?
- Deep-Listening: Developing great customer experience comes from great listening skills. Most banks would be doing a good job at channel analytics. However, if we look at retail and travel, the game is moving to OmniChannel Analytics. There are a number of retailers who are now able to identify a customer or prospect across channels. And as a result they are able to decipher patterns that were so far hidden (e.g. correlations between Net Promoter Score vs. Call Volumes vs. Online Help Content). Instead of using social media for ‘post & forget’ type of content, they are using Social Media for deeper insights and automatically map these to specific parts of the business process or for product development ideas.
Many other industries have been through what banks are going through right now. In order to make digital real and, to develop strategies it’s important to look outside the industry and their coping strategies. Banks should stop looking at themselves as custodians of money. Instead they should look at what people do with that money. And that will open many possibilities. So, Welcome to Possible.