Historically, consumer inertia in banks has been high – a quick survey of my immediate colleagues reveals that most over the age of 40 have been with the same high street bank since opening their first account. Unsurprisingly, those under 40 have several accounts with different banks that they change regularly.
We know there is a whole generation of digital natives that actively avoid face-to-face transactions if there is a quicker, more efficient way of getting what they want. A generation that believes in the insight of algorithms and trusts technology more than a personal advisor. The reality is that Millennials have always used a mouse or ‘swipe’ to handle most of their financial matters.
Emerging digital banks and FinTechs are re-defining the relationship between the customer and the bank. They are not just providing the functionality people want but focusing solely on the customer experience – one that is personalised, informal and friendly.
According to EY’s 2016 Global Consumer Banking Survey, 40% of consumers reported decreased dependence on their existing bank and increased excitement about the alternatives.
It would however, be wrong to view this audience as simply being defined by a generation. Digital aptitude and financial competence are as meaningful as age. A digitally-savvy customer knows what they want. They expect to be treated as an individual, they demand a ‘show not tell’ attitude, transparency, authenticity and above all – value.
The majority of us are now dependent in some way on digital devices. But more and more we are learning to dump stuff that doesn’t add value to our lives. Digital natives self-moderate more naturally, but it is a mindset we are all adopting.
As consumers, we are becoming far more brutal in our value-based decision-making. If it doesn’t delight me and add value to my life today – I dump it. How do digital brands and apps survive against this digital downsizing and de-cluttering? When consumers are seeking more metaphorical space?
Data available from PSDII and Open Banking gives digital banks and FinTechs a real opportunity to promote the right thing at the right time to the right person. Creating a personalised, relevant experience and adding real value to a customer’s everyday life.
A simple swipe or click away from being dumped – like any good relationship – the motivation to delight, care and fulfil the needs of others presents an opportunity for digital FS brands to re-define the customer experience.