Modernize or fail – 12 things that customers expect from their banks

These days, traditional large banks and financial institutions in Germany are under huge pressure to meet their customers‘, partners‘ and investors‘ expectations of modern services. Most banking customers – and these days, this is just as true for personal banking customers as for business customers –  are quite at home in extensive digital ecosystems. They know that these permit far more than simple banking transactions. And they are demanding these skills and services from their banks. However, in Germany, the traditional banks in particular are lagging behind in their digital prowess in a number of areas. Even though the banking system has been rapidly consolidated over a number of years, the results of this is still not meeting their customers‘ true expectations. We’ve compiled 12 fundamental expectations of good banking service for you. Wouldn’t it be great if these became standard practice?

A German-language banking report by the management consultancy Oliver Wyman which forecasts the future of banking in 2030 had the provocative title: We’re still here! How to belong to the 150 German banks. The report’s prognosis was that, of the current 1,600 banks active in Germany, in the next 10-15 years only 150 –300 would still be around. Do you want to be one of those who makes it? Then ask yourself whether you can meet the following expectations:

Modernising the banking system– 12 things which customers expect from their banks

1. Find me
   Find me – customers expect their advisor to anticipate their individual needs. This requires you to employ data analytics methods and visualisation elements. Traditional market segmentation by age, income or assets just doesn’t cut it any more.
2. Advise me
   Advise me– customers expect knowledgeable interaction, whether with an advisor or online.  They assume that their counterpart has correctly analysed and understood their data and can use make sensile recommendations based on this. An important part in this is played by self-learning systems.
3. Ask me
   Ask me – customers expect that their advisor has got a clear picture of their needs and has actively sourced the information he needs for this.
4. Stick with me
   Stick with me– customers expect that their counterpart isn’t just interested in doing a quick deal,  rather is interested in creating a long-term, sustainable partnership. The customer’s needs must take the foreground here, not the advisor’s own interests or potential commission.
5. Excite me
   Excite me– customers expect their advisor to excite them with that little bit extra.  Great customer service, appealing to customer’s emotions and the fun factor wow your customers and show that your advisors are willing to go the extra mile for their customers.
6. Know me better
   Get to know me better – customers expect new services, which fit to their needs and their personality. KYC (know your customer) should be your goal right from the initial contact. True customer retention management goes further. It involves meeting the customer’s subconcious, intrinsic needs.
7. Compare me
   Compare me– customers expect their counterpart to not only know about them, but also how they match up to others, and what they can do better.  In personal financial management, an approach such as peer group analysis could help you make concrete recommendations.
8. Trade with me
   Reward me– customers expect their counterpart to give them something in return for being allowed access to their mass of data.  A common tactic in the retail world, customers are not getting this from their banks.
9. Educate me
   Educate me – customers expect their banking partner to support them to become more financially savvy, so that they can make more of their money. This could be online, mobile, or at point of sale on their smartphones.
10. Alert me
    Alert me – customers expect their advisors to immediately and directly inform them of important issues or events.   Mobile alerts, sent in real time, are an excellent way to do this and strengthen the customer relationship in turn.
11. Let me choose
    Let me choose – customers expect their countarpart to give them the opportunity to choose. Whether this is choosing how to access their accounts, the services they use, products or just setting their personal preferences.
12. Protect me
    Protect me – Customers expect their business relationship and the data garnered from this to be kept safe and secure, protected from fraud.

Behind all these expectations lie the value propositions which customers have already experienced in their digital ecosystem. However, these are only partially, insufficiently or not at all being offered by their banks. How can you, as a financial services provider, react quickly and flexibly to these customer expectations so that you are still an active player in 2030’s banking world?

Give your customers value by modernising

The customer expectations force field

Have you ever asked yourself where these expectations come from? How well do you actually know your customers? As a financial institution, you are first and foremost a service provider, giving your customers added value with your services. To do this, you will need to know your customers very well and also know that on their journeys to fulfilling their aims and desires, they are caught in a permanent force field between need, frustration and joy.  The better you are placed to be a value creater, a painkiller and a genie who has a comprehensive range of products and services on offer to pull your customers out of this force field, the better your chances are of still being here in 2030. But how can you do this?

A strategy for modernising: The soft and hard facts.

To become a value creater, a painkiller and a genie, there are two main sides to consider:

1. The soft aspects relate to direct interactions with your customer.

• Build a sustainable relationship based on trust
• Enable dialogue and interaction
• Generate a unique selling proposition and grow their money
• Develop efficient service strategies
• Identify the value in contact between customer and provider, and make this attractive
• Link up channels with the customer in focus, creating a seamless customer experience

2. The hard aspects relate to the technical specifications you need.

• A way of quickly and cheaply improving, developing and implementing business models and processes
• Collect relevant customer information, and evaluate and use this intelligently
• Optimise processes, make better forecasts and give the value this generates to the client

Do you know your customers?

In order to purposely cover the soft aspects and to make the interactions with your customers as personalised as possible, you need to know them very well indeed, and to target their subconscious, intrinsic needs. You goal is individual marketing. In this digital era, customers are becoming more willing to have data collected on them as they are increasingly gaining value from this themselves. In retail, this is now actually expected. Brands, traders and online portals who have been bright and resourceful enough to see and exploit this trend have a huge competitive advantage and have often become trend setters overnight with their customised services.   Customized beauty, emotional shopping experiences – way back in 2013 the German Future Institute Zukunftsinstitut forecast the trend towards individualised shopping experiences in their Trendsetter study. Even the fact that a customer gets annoyed if he continues to see online advertising for a product he’s just brought shows the need that is there for individualised marketing based on buying behaviour. Targetting the individual.

Become your customers‘ trusted partner – serve their intrinsic needs

Customers tend to be ambivalent about this issue. They want individual service and accept that their personal data will be saved and evaluated for this. However, they tend to not quite trust the online shops and platforms they frequent every day. Who, whoever, would they be most willing to share their information with, when not a bank, traditionally the epitome of institutional security and discretion?

So, how could this work? Here’s an example. All the information you need on movements, shopping preferences and your customers’ activities could be collected over an app,  which you provide. Using the input which clients voluntarily give you, the shopping cart that he fills throughout the year could also be filled with items of personal value to the customer, like so:  Your customer didn’t enjoy his stay in a hotel? The app makes recommendations of hotels in the same area which are better suited to the customer’s preferences. The customer has allergies? The app warns him if the products he is buying have ingredients which could trigger an allergy.  The client is browsing car sales websites? The app recommends making an appointment with this personal banking advisor to secure the necessary finance. This is how you, as a bank, can personally be there for everything yourr customer is doing with his money.

• Move away from being purely a bank to being a fulfiller of wishes, a service provider, a value adder and a painkiler, targetting and serving your customers‘ subconscious, intrinsic desires..

Yes, this is a paradigm shift. Your job is no longer about just managing and processing banking transactions, it needs to be about anticipating and being proactive about what your customer needs and giving him added value which he trusts and relies upon. But how can you extend your range of services in this direction?

Modernise your IT systems

You’ve guessed it. In order to meet all of these customer expectations while also adhering to various laws and regulations, keeping everything secure, keeping going in an extremely competitive environment and surviving unexpected, unprecedented situations such as the current COVID-19 pandemic, you need to look at the hard aspects and get everything to do with IT and digitalisation up to scratch. The IT systems in many banks are a mixed bag of old and new systems which have been introduced and extended over the years. Employees who set up one or more of these systems back in the day are often no longer working at the bank. Their predecessors have found creative ways of connecting the old inhouse systems with the newer systems.  But whether or not these have the necessary specifications for or are even compatible with new components and extensions remains to be seen.

What at first glance looks like an insurmountable pile of unsolvable issues can be sorted step for step, one piece at a time. While modernising, you need to ensure that the established systems keep on running until they, one after the other, can be replaced by new solutions.

If you wish to easily fulfil aims such as

• Reducing costs and increasing returns
• Managing and minimising risk
• Accelerating processes
• Increasing transparency and, naturally…
• Improving customer experience

the solution is a hybrid business integration platform. The SEEBURGER Business Integration Suite (BIS) enables you to integrate all your systems, applications, cloud services, ERP etc. This gives you a comprehensive, compelling IT solution which allows you to not only get to know your customers better, but to serve them better, too. To fulfill their desires, kill their pain and give them value.

Modernising your IT systems also increases your chances of still being an active player in the financial world in 2030. Let us help you.

More articles on the topic:

• https://blog.seeburger.com/how-to-achieve-rapid-hybrid-integration-for-public-cloud/
• https://blog.seeburger.com/what-is-api-integration/
• https://blog.seeburger.com/banks-in-2020-a-payments-integration-renovation/
• https://blog.seeburger.com/four-best-practices-to-help-banks-supercharge-their-payments-modernization-efforts/
• https://blog.seeburger.com/what-is-the-future-of-digital-payments/
• https://blog.seeburger.com/real-time-payments-benefits-and-continued-challenges-in-2020/
• https://blog.seeburger.com/digital-banking-in-the-wake-of-covid-19/
• https://blog.seeburger.com/modernize-or-else/
• https://www.seeburger.com/solutions/fsi/