Banking Strategies See A Shift: Product Centric to Customer Centric

For the longest time a bank manager was thought to be so much more than just someone running a branch of a bank. The bank manager was someone the customers approached for financial advice, about mortgage loans. The relationship a customer and the banker who provided the services had is now slowly diminishing to be nothing as digital banking is on the rise. A digital banking experience without a glitch or causing frustration is in high demand; however, people still want that human touch in their interactions with their banks. It is this feature that remains the key to making meaningful relationships and building trust and loyalty. The only way to do this is for banks to deliver a great digital experience and remain the trusted advisor. For this to take place there is a need for these institutions to shift from product centric approach to a customer centric approach.

“It’s a behavioral approach, not a product-based approach. It’s putting the bank in people’s lives, not just creating another product to sell them,” said Brett King, author and founder of budgeting app Moven.  This implies that banks must focus on giving their customers a contextual and personalized experience. To do this banks need to truly embrace the idea that the best form of advice on how to personalize the digital banking experience comes from data. Banks can use data based insights to become the customer’s “financial friend.”  For example, banks can analyze spending behaviors to spot important moments in the customers’ life such as getting married or booking a vacation and thus suggest the right kind of solutions that the customer might face.

An example of this is the TD mobile app. It can give the customer suggestions of how much money he could transfer to a savings account, based on how the bank tracked his spending habits. The app also notes when the customer crosses the border and offered to put his U.S. dollar card on top of his mobile wallet.According to the Collinson Group’s study of affluent middle class consumers in the US found that 47% feel more loyal towards banking brands that know who they are and treat them differently, and 49% expect their bank to proactively offer products and services that meet their needs. It is these needs that have led to the form of banking that we see today.

Security and protection of data is an essential part of today’s banking systems. Cybercrimes are on the rise with hackers and identity thieves constantly exploiting the weakness in the security system of financial institutions. Other than that banks must offer quick solutions to problems faced by the customers in their lives.  When polled, 58% of affluent middle class consumers in the US identified theft protection and 57% said assistance with lost cards were areas where they would appreciate more support. This has led to financial institutions spending millions of dollars on firewalls and other preventive measures to secure their customers’ data from being compromised. They also utilize resources to establish 24/7 call centers so that the customers can feel safer in case of a robbery.

Since technology has been a large part of the last decade it only makes sense that the finance sector keeps up with it. There are dozens of mobile apps which now allow users to do any kind of transaction using contact-less payment terminals.  Samsung Pay is one example of an online wallet that can be used to book tickets for a vacation, pay fees and more.  There are more efforts being made by various financial institutions to encourage loyalty and to make the banking experience easy and satisfactory for each and every customer.