As the world continues to embrace digital technologies, consumers’ expectations and demands continue to rise. One industry drives expectations of other industries, and when vendors fail to innovate they lose.
Stories abound about enterprises that failed to read the writing on the wall. Blockbuster Video, for example, did not understand the critical need to provide seamless online and physical experiences to their customer base. When offered a partnership opportunity with a new startup, Netflix, Blockbuster refused confident of their history of success. Ten years later, Blockbuster went bankrupt.
Retail banking is similar to Blockbuster Video in that it has heavy investments in physical locations and a corporate culture that revels in past successes leading them to believe they are leaders. Blockbuster rejected the belief that they must change to stay relevant and Netflix swooped in to disrupt the industry by anticipating what customers wanted. Today there are no more Blockbuster’s and Netflix has become ubiquitous.
Amazon started as an online bookseller and has grown into an industry leading behemoth for online retail. There are myriad reasons for its success, but key drivers of their success are listening to customers, leveraging existing data, and a corporate culture that improves its existing business while creating organizational space to invent future businesses at the same time.
Banking industry articles stress the importance of digital transformation and paint broad imaginative pictures of what banking could look like in the future. Geo-fenced offers and retail benefits from partner vendors are great goals to strive for, but the current state of the industry, everything from regulations to legacy systems and slim profit margins to customer mistrust, makes those futuristic scenarios lofty aspirations. As the saying goes, one must walk before they run, and there will be stumbling along the way, but progress is inevitable for those who listen, understand and respond.
Keeping up with rapid technology innovation and managing consumer interactions means banks must devise a strategy that encompasses all parts of the organization to integrate and share information internally so everyone is working together. Aligning customer, product, and marketing data to create a comprehensive view of the customer will benefit the entire organization. With executive guidance, these benefits will build exponentially to organically evolve the business with sure footing along the way.
Aligning data will facilitate a cultural shift in the way banks think and innovate. Applied advanced analytics on the large amounts of structured and unstructured data at a banks disposal, can provide an empirical analysis of customer’s recent behaviors and past experiences with a bank to drive new strategies for deeper engagement. Insights derived from existing data help drive improved interactions, product offerings, and operations. These insights can be used to generate personalized, relevant, contextual messaging for more intelligent interactions and offers.
Rather than painting a futuristic representation of what banking could look like, start with a more realistic view and take the first couple of steps toward transformation. Invest in technology that provides a holistic view of the customer and breaks down silos within the organization. Then with executive guidance to drive the cultural shift, banks can tap into existing data for meaningful insights that can be turned into positive bottom line results which can be measured, monitored, and evaluated in real time. A journey begins one step at a time. Creating a cultural shift that values innovation and data-driven decisions can help make those lofty aspirations a reality.