I write this blog under the assumption that we’ve all heard enough about the devastating impact of 2020 on lives and livelihoods worldwide, and that the banking and financial services industry had no immunity from the damaging effects. I also expect we all can agree that in 2021 financial companies and institutions will have to rediscover themselves and, in the process, lead the changes required to recover and thrive.
In this blog, I address some of the challenges and trends that will impact the industry’s ability to do so in the coming year in several key areas: technology and infrastructure, customer engagement, AI-driven marketing, and talent development.
Investing in digital transformation
At a fundamental level, social distancing measures necessitated by the pandemic brought brands that rely heavily on in-person, face-to-face transactions to a grinding halt for six to eight months. This alone put many digitally-challenged consumers and their banks in peril and drove the industry’s more proactive players to rethink the fragmented, legacy processes and tools they’ve relied on for so long—like inefficient back-office work—to support their essential activities.
As everyone more or less settled into a socially distant world, brands unprepared for the new reality scrambled to keep up with the surging digital traffic. Some had not put the digital channels required to do this in place, rendering them incapable of communicating to their customers at the right place and time. Some raced against time to implement the technology that could ensure quality service even through remote work. Still others tried unsuccessfully to push products totally unsuitable for digital touch points.
Brands that realized the inefficacy of digital window dressing or half-measures soon recognized the urgent need to invest in scaling their technological infrastructures and acquiring the capabilities necessary for engaging customers in the new normal. Such investments will continue throughout 2021 as effecting true digital transformation will always be a measured process.
Engaging customers more effectively
Next, we will see even more banking and financial brands implement intelligent platforms for customer engagement. More importantly, this stems from the pervasive demand for at-scale personalization as consumers expect more relevant offers, content, and journeys from all brands.
Banks and financial institutions will continue to invest in expanding digital channels like chat bots and digital assistants as well as delivering richer mobile experiences. This will require upgrading their solutions to make predicting and proactively responding to the needs of customers in a frictionless manner possible. More generally, we will see a gradual shift towards the Cloud, with a heavy focus on weaving a rigorous security and compliance framework into the new technology.
Making AI-driven insights actionable
In the near term, analytics and AI-driven marketing will become even more critical as brands seek to analyze the effectiveness of their efforts based on diverse metrics. These brands will also need to continuously optimize how they engage individual customers at unprecedented scale and speed based on exactly those real-time, ever-evolving insights. Marketers at banking and financial services brands will aggressively seek solutions that provide an actionable framework capable of fusing insights and impact.
Equipping leaders and teams to succeed
Those charged with envisioning and leading change must recognize the imperative to change themselves. The new realities demand new talents and, by extension, a rapidly expanded scope of skills and training.
I have seen more and more diverse functional departments giving employees more advanced training on, for instance, statistical inferences and analytics systems. Why? Because they want their employees to master the skills required to operate the systems in place, measure relevant activities and outcomes more effectively, and support customers at a more meaningful, individualized level.
Bringing all customers into the digital transformation
Last, but certainly not least, we’ve heard a lot lately about “banking the unbanked” and encouraging digital adoption among consumers. These conversations will continue in 2021 as the industry continues to struggle with the as yet unanswered question, “How can brands address these interrelated challenges effectively and efficiently?”
After the COVID-19 outbreak, one of Resulticks’ clients in the banking industry noticed that many deposits had matured, particularly among the elderly. There were no clear instructions for these customers on what they ought to do online after deposit maturity. The bank then created a voice-based online channel to greatly simplify the whole transaction process for the elderly customers with a simple answer.
Meeting the challenge of change
Many more changes await the banking and financial services industry, from workload migration and cybersecurity to investments in foundational technology and from cloud and SaaS solutions to reimagining the very idea of how to engage customers throughout the relationship lifecycle. All of these challenges and trends are parts of the shifting landscape. How well brands can pivot and adapt will directly impact their leadership in the industry and their relevance to their customers.
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