Looking Back at Finnovate – Top 3 Takeaways
It’s been a week since the team and I returned from the Finnovate Fall Conference in New York and I have not stopped thinking about all the exciting sessions I had the chance to attend, and how much they align with the goals we have here at Coconut. At the show, we were fortunate enough to meet with so many professionals from the financial services and fintech industries that are passionate and excited about the changes coming to the financial world.
The show was broken out into two sections. First, we were treated to two days worth of demos from both emerging and established fintech organizations. It was great to see so many organizations coming up with creative solutions to help financial institutions solves their largest problems. Whether it was security, financial literacy or digital banking tools, the presenting companies shared compelling solutions that left us and the rest of the conference attendees with a lot to think about.
The second section consisted of two days of panel discussions and keynote presentations. This is where the industry leaders really got to shine, taking us through detailed talks on new security concerns, fostering innovation, managing digital transformation, customer experience as a key differentiator and the emergence of AI technology. There was a lot to learn over the two days but I was happy to see a number of key themes emerge.
1. Personalization as Differentiation
I noticed this theme come up frequently throughout the different sessions, particularly in those hosted by Forrester Research, as well as during panels on innovation and customer experience. The prevailing takeaway was that personalization can be a key competitive differentiator for financial institutions, and something that customers really value. In the personalization session hosted by Forrester Research’s Alyson Clarke, Principal Analyst, Digital Business Strategy, noted that in order to stay ahead of the competition, banks need to stop thinking like a retailer. Bank customers do not buy financial services as frequently as they make purchases with other retailers — there are generally 3-5 years between purchases. That makes it difficult, but far from impossible, to build and maintain brand loyalty.
Clarke then focused on data. With the information that banks and credit unions collect when working with their customers, they can use that information to create much more personal, 1:1 experience that will keep the financial institution top of mind. Using real life points of contact like birthdays, anniversaries, children going to college, etc. as a means of reaching out is a great way to connect and be top of mind when they’re ready for a new financial product. Through this sort of personalization, financial institutions could see far more success in maintaining the sort of long term brand loyalty that’s required when dealing with the low frequency of customer purchases typical to financial products.
2. The Growing Importance of Customer Experience
Dovetailing with personalization, a number of the sessions also discussed the importance of banks and credit unions focusing on enhancing customer experience. In an excellent keynote presentation, Jeremy Balkin, Head of Innovation at HSBC presented a case study highlighting the success they’ve seen since implementing a service robot named Pepper.
The main goal of the ‘Pepper the Robot’ program was to increase branch traffic and generate more appointments with the advisors and staff that work in branch. In the 14 months since deployment, HSBC saw a 41% increase in new account openings. HSBC attributes this success to Pepper turning a regular trip to the bank into an experience for new and existing customers. With so much attention around the innovative products and solutions that are making a visit to the branch unnecessary, banks need to invest in creating experiences that will bring customers through the door.
This sentiment was echoed later in the day during a panel discussion on the importance of creating an impactful digital experience. The panel noted that traditionally, banks used segmentation to determine how to reach out and market to their customers. However, times have changed. Major life events like graduating from college used to be a reliable signal that a customer was now likely to be preparing to buy a house, and buying a house would signal their readiness to start a family. But today, this is often not the case. Banks now have to look to more individual data to find out when the best time is to reach a person. And with the right data, they can deliver not only the right marketing material, but deliver it in the way most likely to appeal to that particular customer. To this end, technology can be incredibly useful to banks and credit unions. By expanding their marketing methods through push notifications, apps and SMS notifications, banks are able to leverage data for precision targeting, and then get their message in front of customers eyes in a way that’s unobtrusive, yet highly effective.
3. Partnering with Fintech
With the whole theme of the conference centered around bringing banks and credit unions together with today’s leading fintech providers, the final theme was an obvious one — technology partnerships. Still, it was great to see so many panelists from both sides discuss the importance of these partnerships as a way to retain banking customers and improve the overall experience banks are providing. During Jeremy Balkin’s keynote and during a panel discussion that immediately followed, he spoke at length about the importance of financial institutions embracing emerging fintech companies. He noted how there is so much knowledge that banks have when it comes to serving customers but they can often get stuck when encountering challenges with technology and competitive alternatives. That’s where Fintech companies come in. Through strategic partnerships, they can help banks solves those problems far more quickly than they could on their own, allowing banks to focus on what is most important: providing the best services for their customers.
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