With the freshly announced major restructuring of HSBC, if there’s one thing for sure, it’s that the UK banking scene is undergoing a significant change. After a series of mishaps across the industry ranging from mis-sold products to rate fixing, bankers’ bonuses and IT failures, it is fair to say that the effect of politicians and consumers dissatisfaction with their current banking services is being felt.
As far back as 2012, a conservative estimate of 2.4 million customers left the UK’s five biggest banks (separate research from YouGov predicted that the number was as high as 14 million) and that figure is expected to double over the next year or so. With trust and reputations being lower than they have for a long time, how can the banks restore the faith that the public once had in them and effectively engage with them in order to demonstrate real integrity?
With consumer trust in the financial services industry at a damagingly low level , the deconstruction of the banking sector has ignited the trend towards digital banking.
Today, although a small number of innovative companies are offering customers a user-friendly online banking service and a full range of products, without the need for high street branches, lengthy queues and failing legacy technology, there is a long way to go before the true benefits of digital banking are realised.
To stay profitable and grow in this digital economy, existing banks need to adopt a customer-centric business model, diversify online delivery of products and services channels, and act on meaningful and valuable trails of digital information they have been able to collate.
When we begin to analyse the information obtained from data mining, as it pertains to data-driven digital banking and finances, we start to see some interesting results.
Data is the driving force behind social media strategy for digital banks
According to the CGI 77% of Westerners want to be rewarded for their business, while 51% expect to be able to use any device they wish in order to conduct business, purchase goods or anything else and with immediate results (with regards to digital banking).
How banks use information like this is fairly straightforward, especially when an overwhelming number of people see loyalty rewards as a reason for switching banks. On the other hand, The Guardian poll suggests that “if my provider introduced charges”, an action like this would be enough to make people switch.
Get to know your customers. Clearly, it seems that asking the right question is important – since the questions asked by The Guardian are limited in their scope. In any case, there are important signals that the smart digital bank can pick up on using a data-driven approach to engaging their customers and, ultimately, rebuilding the broken image of the banking industry as a whole.
Using the data to attract and engage
Even before digital banks go to launch, there is a case to be made for the use of a data-driven digital banking strategy to build the reputation of a particular bank before it even gets out of the gates. Companies in retail focused industries employ this kind of tactic all of the time, so why not digital banks?
As reported in Computer Weekly “Traditional retail banks in the UK have IT budgets that run into the billions of pounds and 80% of it is spent on maintaining legacy systems… a growing number of customers want to be able to bank whenever and wherever they want.”.
This leads us to one very important takeaway point: traditional banks spend far too much on systems and digital architecture that their customers simply do not want to use. Offer them an alternative, like a fully digital bank that people can access from any device, and the traditional banks are going to be in a lot of trouble and very quickly.
Banks that listen to the needs and wants of the customer are banks that are on the right road to digital domination. The trouble lies in discovering those needs and desires, then actioning them. Since this data is readily available, then all that remains is making the switch and advertising the fact.
Being able to send money to people with a simple text message, via services like PayM, shows that banks are starting to listen – but these services should be seamless and easy to use for the consumer in order to guarantee the service widely adopted.
Banking can no longer be a starched affair
Digital – any device banking means getting closer to the customer. Mobile devices are almost extensions of ourselves, much more so than a desktop computer and infinitely more personal than a high street bank branch. Understanding how personal these things are is key to understanding how to get closer to the customer.
By going ‘all in’ with digital, and putting digital at the very centre of the business model, is an extremely effective way in redefining customer relationships – which is precisely what is needed, and why a data-driven digital banking approach is necessary.
Moving away from reactive customer relationships, banks are able to get into a more intimate and proactive experience with their customers regardless of what device they use to do their banking. There is a vast wealth of information about their customers, across multiple platforms and from various sources, that banks can make use of that were not previously made available.
This new digital era that we find ourselves in has opened doors to an enormous amount of data, that is just waiting for banks to mine and make use of. Analytical tools are able to comb through this data trove to find out what customers need, want and expect. Entire online conversations can be accessed and analysed in order to find out exactly what is needed to make themselves look more attentive and responsive.
If you know what a person wants, you can not only not just provide it, but also anticipate what they may be looking for. This is the level of intimacy that is going to carry banking forward, and help retain existing customers. Effectively leveraging social channels, armed with relevant extrapolated data, can attract new customers.
Feeding the digital demand
The tech-savvy of today are becoming much more demanding of their service providers, across the board, while traditional banks are often seen as being ‘stuck in the past’ as well as stuffy and unyielding. Instead of banks being looked at like they are dark and mysterious, they need be seen to be much more open and approachable. For survival banks need to change, they need to embrace social and mobile technology – not shun it – by way of the adoption of data-driven strategy.
Capturing market share ( A data-driven digital approach)
In order to successfully execute a digital offering a data-driven campaign should be at the top of the agenda. Data-driven marketing is not really a new concept, but it is one that has been easier to execute and measure thanks to the rise of people, processes, tools available, social media and social networking.
Of course, in order for these digital banks to have the desired impact on the sector, they need to take a data-driven approach to capture market share and build their reputation. Research needs to be completed and data needs to be gathered that informs digital banking organisations of customer’s needs for their products and services. Mining data, analysing it and turning it into a list of goals is something digital banks need to do in order to develop a service that truly meets their customers’ needs.
Data-driven services and visual communications
It’s all well and good being able to acquire, parse, filter and mine that data. It’s meaningless unless you understand how to represent, refine and interact them with your customers.
One of the ways digital banking companies are differentiating themselves is by promising personalised banking that is tailored to the way in which customers like to bank. Their intention is to provide bespoke recommendations to customers based on their banking habits, financial situation and requirements. However in order for this to work, they need to ensure they are capturing the right data from customers.
Not only that but also presenting it in a way that is easy for them to understand. For example, it could be to promote the adoption of mobile banking and overcome and security fears for using it:
Visual communications like infographics are great for presenting data in an easy to read format.
Data has a crucial role to play in the success of digital banking and companies need to find a way to use it effectively. There is little point in putting money, time and effort into acquiring, mining, filtering and analysing data if companies then don’t know how to present their findings. How many of you are underwhelmed by what you are presented with when you log onto your internet banking and are presented with a list of accounts, a list of transactions, with no context or recommendations? Have you tried mining back 5 years of data to see where your money has been going?
This is where visual communications and data visualisation comes into play. Data visualisation is all about using visual representations of data to communicate and engage with customers in a meaningful, impactful and comprehensible way. A well designed dashboard for banking customers could have a profound impact on the way they understand their manage finances and spending patterns
Great examples of other visual communications tools are infographics and animated motion graphics.
Infographics and animated motion graphics
When it comes to communicating data with customers, the last thing a digital bank should think about doing is sending a link to a lengthy, jargon-filled report – there’s nothing more boring or off-putting for customers!
Instead they need to find a way to communicate the importance of their data in a user-friendly and easy to digest format. Infographics and animated motion graphics are the perfect solution. These data visualisation tools are designed to make data simple, understandable and digestible.
Here are some of the key benefits of using infographics and other data visualisation tools…
Infographics and animation motion graphics are attractive to look at. They immediately catch users’ eyes and draw them in with their bold fonts, bright colours and neatly presented information. If you are looking for a way to entice people to read your data, an infographic is the way to do it.
Easy and quick to digest
Consumers don’t have time to sift through reports or view complicated charts. They want the facts to be presented in a format that is easy to digest. Infographics and animated motion graphics present the important facts to customers and can be consumed within a minute or two. The process of digesting the data requires very little effort on the user’s part.
Not only are infographics easy to read but also easy to understand. In fact, they’re shown to have a 95% comprehension rate, while plain text rates at 70%. Their visual elements are also highly beneficial, as 65% of the population are actually visual learners.
Infographics are 80% more likely to be read than plain text. They’re much more engaging than a report or article and inform and educate consumers in a fun and interactive way.
Build brand reputation
Digital banking companies that use visual communications to present their data will be seen as innovative and forward thinking. The colours and animations used in their data presentations will help to give them a personality and make their brand more memorable.
Remember – 80% of people remember what they see but only 20% remember what they read!
Visual communications like infographics and animated motion graphics are highly shareable. They can be used on a digital banking company’s website, social media pages and marketing emails. If they’re attractive, useful and informative, customers will want to share them on their social media pages, helping to extend the marketing reach. A great infographic even has the potential to go viral!
Keep in mind that visual communications like infographics and animated motion graphics are great for driving traffic to your website. It’s been found that businesses that use infographics grow in traffic an average of 12% more than those who don’t.
Crucial part of marketing a digital bank
Visual communications have a crucial role to play in the marketing of a digital bank. They need to differentiate themselves from traditional banks, presenting and portraying themselves as being innovative, fresh and exciting and visual communications will help them to achieve this.
It’s also extremely important that digital banks engage with customers via social media. Remember that social media is all about visual appeal, so the more attractively you can present information to customers, the more likely they are to act on it and share it with their peers.
A good social media strategy coupled with great visual communications will help digital banks to stand out not only from traditional banking institutions but also the growing number of digital banking competitors they are likely to face over the next few years.
A great example of a digital bank that is already making waves in the industry is Atom. This company is currently preparing to launch in the UK and be the country’s first truly digital bank. In order to build up brand presence, they have been engaging with consumers via social media and using visual communications to spread the word.
If you haven’t already, now’s the time to start marketing your digital bank and using visual data to connect with your customers.
How VISU.AL can help
We are here to unlock the potential of your data, helping you with everything from processing and analysing your data, to visually communicating it to your customers. An information design and communications company, we create professional data visualisations, dashboards, infographics and animated motion graphics that will captivate your target audience, connect them with your data and give them a greater understanding of what you have to offer.
For more information, please feel free get in touch with our team.