Bank 2.0. How customer behaviour and technology will change the future of financial services

We had not done our basic homework on customer behaviour.

Deregulation, increasing volatility in capital markets and

VSC Virtual Support Centre; a call centre virtually supported by customer service representatives who typically operate from home (i.e. homesourcing)

FMCG Fast Moving Consumer Goods; products that are sold quickly at relatively low costs

When those customers talk about mobile, the Internet, social networks and so forth, don’t say anything about the effectiveness of your branch, or how broad your ATM network is. Take it on-board and figure out how you are going to provide customers with accessibility and functionality on the right channels at the right time.

Segmentation and customer intelligence through customer analytics capability will be the key. More than simply segmenting customers, we will need to understand how they behave, what they do, how often, and through which channels. Currently, we don’t even understand which transactions go through which channel for existing customers. Marketing must understand the why and how, and ask customers what they want. Perhaps we do that already, but we certainly don’t use that data effectively to sell.

Combining this basic tenet with the concept of permission marketing and better customer analytics, we realise that push won’t work in the BANK 2.0 paradigm. Indeed, we instinctively have to understand our customers so well that we will anticipate their needs. When we get this right, the subsequent offer will not only feel like a good sale to the customer, it will be great service. This is why push-based message marketing needs to change to pull-based, point-of-impact, service selling.

Persuasive sale is the technical art of selling someone something that they don’t necessarily need, but convincing them long enough to get the commitment to sign. Indeed, when presented with enough pressure, customers will often commit just to terminate the sales conversation. Once bitten, twice shy when it comes to this approach. When we get pushed into a buy, we don’t usually come back.

The payment solution allows Mercantile Bank customers to send money via the PayPal network to any individual who has an email address or mobile phone number. If they don’t have a PayPal account, they will have to create one before they can receive the funds.
CashEdge has released a service they call POPMoney, which is already subscribed to by First Hawaiian Bank and PNC Bank based in Pittsburgh. POPMoney extends the P2P payment model/service to allow bank-to-bank payments. From within either online banking or a mobile banking app, customers can send money to a recipient by using their email address, mobile phone number or their bank account details. If you are a customer of a subscribing bank receiving a payment, then the payment goes straight into your nominated bank account. If not, you simply go to the POPMoney website, register and give the bank account details where you would like it deposited. POPMoney uses the SWIFT network to finalise the transaction for you.

“This deal reflects the growing functionality of the mobile channel and is a strong signal to banks of where customer expectations are headed ... Given the near-ubiquity of mobile devices and fast adoption of smart-phones in particular, we can expect an increasing convergence of trusted banking relationships, personal payments and mobile.”