Major shifts in consumer behaviours are changing the way the financial services need to engage, and the pace of this change is having a profound effect on ‘traditional’ business models. Here, Associate Strategy Director, Michelle Bower has identified six challenges that the financial services need to tackle in order to stay relevant in an increasingly contactless world.
We have a money problem
It may not be very British of us, but we need to start talking about money. Money is only a tool, some know how to use it better than others, but it affects how all of us live and work. Globally, there is an opportunity for brands to start different conversations about money, in a way that directly aligns to their purpose to create relevant and emotionally intelligent experiences for their customers, transformations even!
Money is the No.1 cause of anxiety in adults in UK and people with mental health illnesses are three times more likely to be in problem debt. Source: money & mental health.org
Customers are looking to businesses and brands to inspire better financial habits in future generations and help everyone take financial wellbeing as seriously as our physical and mental health.
By the age of 7 children have developed their attitudes and values towards money – and these are likely to stay with them for life. Source: Money Advice Service
Banking on experience
The bigger story here is not just about ‘banking’, it’s about how we each experience the financial services and how they make us feel about money and ourselves. These businesses were established to safeguard, reassure, educate and guide us through our personal interactions and relationships with money. Why don’t we feel engaged with them, still?
“Traditional banking is misaligned with today’s consumers. Banks think about their products; people think about how they’re treated. Banks think about how they can profit; people think about getting a rewarding deal. Banks think about economic value; people think about personal value.” Source: Accenture report on financial mindsets
Do you have a trust challenge?
When your sector is overshadowed by distrust and bad behaviour, you have to decide to stand out with deeds, not words. NatWest, for instance, distanced itself from parent group RBS and humbly stated “we are what we do” in its hard-hitting campaign of September 2016, as part of its identity refresh.
Interact on purpose
In the competitive, fast-paced world of fast-fashion, TOMS’ one-for-one model cut through with its for-profit charitable retail offer. The model has inspired other businesses from toothbrushes, optical, food, books and even the humble toilet roll. Some brands will go as far as telling you not to buy their products if it chimes with their values – as Patagonia marketed with an anti-Black Friday campaign.
Be a pillar of the community
Customers are increasingly cynical of large brands appearing in their neighbourhoods without integrating, collaborating or tailoring to their local needs (or paying fair taxes). Brands who consult, listen and work with local communities build stronger foundations, earn trust and act out their values authentically.
We’ve recently been working with Nationwide Building Society on its role within different communities and its customer experience. By bringing its purpose and values to life it stands apart from the banks on the UK high streets, with one of the biggest differences being that it’s committed to the human touch and keeping branches open.
Another great example is the Nike Community Stores that commit to hiring at least 80% of staff ‘store athletes’ from within 5 miles of the store, and give them volunteer time to support local community sports. Co-op food stores have repositioned its membership model, with customers able to buy a share for £1 – earning 5% own-brand cash-back incentives for you and 1% for your local community.
Do you have a tech & data challenge?
When customers have better tech (and higher expectations) than the brands they’re paying to interact with, they can be increasingly critical of the value and experience of the service.
Established brands can suffer with legacy tech issues as costly software and hardware is updated en masse, while keeping their customers’ data secure. Compared to their small, agile and tech-enabled competitors starting fintech revolutions with a clear purpose, digital-first services and always-in-beta mind set.
This David & Goliath comparison is tough; customers want both the governance and high standards but also smart and responsive services that feel modern and consistent across all customer touch-points.
Make the intangible tangible
Financial speak can alienate first-time customers, or even existing customers who are too embarrassed to admit what they don’t understand. Yes, we can Google everything, but we trust people and brands that speak like us – on a level with empathy for new language and processes.
Vitality health and life insurance appeared like a breath of fresh air, changing the conversation from cautious, legal and dusty to proactive health, customer-control and well, vitality! Benefits became tangible and the services lifestyle-relevant. Similarly Aviva car insurance got families talking about the benefits of “black box” devices that monitor how you drive and reward good drivers – rather than having to differentiate with renewal prices and deals, they made data useful and fun.
Looking further afield, Netflix and Spotify are masterful users of data. They engage their customers with data-led adverts, serve up personalised suggestions based on big data algorithms and differentiate from mere commodity and catalogue with their addictively delightful and effortless user experience.
Differentiate with the human touch
The robots will take all of our jobs. They will be more productive, punctual, with more customer knowledge than your employees of the month. Until then, you can use tech to increase efficiency, free up time and allow your people to shine.
Our work for O2 had customer service and a human-led experience at its heart. Each new employee was taken through a bespoke training programme that was inspired by the store’s individual city and the people living there. Nurturing emotional intelligence and the ability to excite and inform customers, the programme ensured that staff could provide a much more memorable in-store experience.
Virgin Money’s Lounges located near key transport hubs in large UK cities use their experience of the travel, hospitality and entertainment sectors to keep their online customers happy in real life, asking “why bank, when you can lounge?” giving them access to perks like free refreshments, newspapers, entertainment and community events.
Do you have a space challenge?
No, not Elon Musk or Richard Branson and their intergalactic future-preneurialism. The physical space that can, through no fault of your own: be costly, no longer fit for purpose, in the wrong part of town or simply uninviting to a demanding customer. Brands that recognise they need to behave differently in different spaces in order to stay relevant are able to maximise their return on investment and create headlines at the same time.
Become a living brand billboard
Stop seeing a costly space, start seeing a living billboard for your brand vision and values. What can you do and say here that helps your customers (and non-customers) double take your brand? Focus on your target customers, remember secondary and halo customers still benefit and crucially, recommend you to others.
Sonos speakers were already selling well within technology stores, but by designing visually striking spaces to gather and enjoy music in, they could directly tell an immersive story about the joy of accessing your music in every room in your home, effortlessly.
Even when these spaces close, or move on, they have created a warm and lasting memory in the customer, or future-customer, as well as having tested new ways to interact and learn from feedback.
Adapt and flex in format
Think about how your total offer can be experienced in different space constraints, better to do fewer things well, than all things with compromise. This is starting to become evident in high street banking, with mobile (on wheels) remote community solutions, tailored convenience-led small formats and high footfall experience flagships in major cities.
Automotive brands are starting to experiment with formats that bolster their existing network and offer a viable alternative to the industrial estate experience, appearing in high footfall malls and high streets and adopting a fashion and lifestyle approach to shopping and browsing. Our work with digital platform Rockar has helped put Hyundai, Jaguar and Land Rover customers in control of the experience, with ultimate convenience and ‘add-to-basket’ ease.
Customers are actively looking to be challenged and charmed by brands, they love sharing newness with friends, a new social currency has emerged, people are craving visual discovery – armed and ready to share on Instagram and Facebook.
Lifestyle-aware estate agent Sans Pere have created neighbourhood cafés in East London, where you can either shop the café, homeware or have a conversation with staff about property for sale. The model is relatively new, but is focusing on neighbourhoods and placemaking, in order to start a new conversation about property and indirectly, money.
In summary, six strategies to engage customers in an increasingly contactless world:
- Interact on purpose
- Be a pillar of the community
- Make the intangible tangible
- Differentiate with the human touch
- Become a living brand billboard
- Adapt and flex in format
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What’s challenging you and your customers? If you’d like to think about your challenges, value-add customer experiences, or reframe your barriers and benefits as opportunities in order to become an engaging brand, we’d love to hear from you… please don’t hesitate to contact firstname.lastname@example.org.