KNOWING YOUR CUSTOMERS’ NEEDS IS ESSENTIAL FOR BANKING INNOVATION

Published On : 12/22/2015

Keith Rowling, MD UK & Ireland, First Data

“What’s the next big thing?” is a question banks, retailers and other organisations constantly ask themselves in order to develop products and solutions with the intention of driving revenue. However, they will struggle to answer that question without getting inside their customers’ heads.

It is increasingly difficult to create new innovations that change customer habits and break existing brand loyalties, so organisations must think beyond mobile enablement and cloud-based delivery to succeed.

 Stay on target in the fast moving world of mobile

With over half of the world’s population now owning a mobile device, it comes as no surprise that mobile is driving customer engagement and interaction. In the rapidly moving world of smartphones, banks, retailers and other organisations are racing to come up with new digital offerings. However, while mobile innovations are essential for growth, the rush to bring an innovative product or services to the table has meant that some organisations make hasty assumptions about their customers’ needs. This rushed approach can often mean organisations are off-target with their innovations. Gaining customer adoption in the new digital world can only be done by knowing what they need.

In a world where most people want everything ‘on the go’ most banks now offer solutions for customers to check their balances, make payments, transfer money and dispute transactions. But like most organisations, banks need to be thinking about the next wave of customers and what their demands will be – such as the ‘digital natives’, the generation that doesn’t know a world pre-digital.

Below is a breakdown of what mobile banking app features are most important to customers, according to recent research by First Data:

Don’t make assumptions – they could cost you

Most banks base their innovations around customer feedback but many still make assumptions about their customers’ needs – and those assumptions can come with a big price tag.

There is a lot to think about when developing innovative products or services and there is a lot at stake. Aside from the obvious questions (Will the technology work? Will it change customer habits?), it is important to also think about whether this innovation will be the tipping point in attracting new customers, and therefore if it will create new revenue streams.

Engagement with the customer is key, in order to deliver a product or service that they need and want. Contactless payment, which was introduced in 2007, is a good example of where technology advances superseded customer needs – lack of education among users and security concerns meant that banking customers were hesitant to use the technology. Only when London Transport started using contactless ticketing on the underground, did the UK see a surge in contactless payments. This proves that when there is a need for technology (i.e. faster payments while commuting), organisations will see customers changing their habits, breaking existing brand loyalties and flocking to their innovative creation – therefore having a positive impact on revenue.

Listen to your customers – keep them happy!

Happy customers are good for business – so why not keep them on side? Satisfying customers should be at the core of any organisation or business, so developing a product using the empathy-based approach is key. Rather than building a product or implementing a service to then find out it has flaws – why not get it right the first time round? By undertaking in-depth homework into customers’ needs before ideas are advanced or solutions are developed, banks and other organisations can take ideas in a different direction, if needed, saving time and cost.

An example of ‘customer-centric design’ approach was taken by First Data when working on a product to improve the way customers reported a suspicious transaction on their account. Rather than going ahead and digitising the process and expecting customers to take it on board, design thinking was employed early in the development process to understand the bank customers’ needs.

Large amounts of time, resources and money are spent launching products and solutions with a lower engagement rate than expected. But organisations can avoid all those costly errors and disappointment by understanding their customers and building ideas around their needs. By taking the design thinking and empathy-based approach and working towards understanding the real challenges your customers face, your organisation will reap the benefits of standing out from the competition who continue to make assumptions about their customers. Don’t act with haste and make assumptions about what your customers want, after all – slow and steady wins the race.

Finance Digest