The world generates an estimated 2.5 quintillion bytes of data daily, a torrent of information which emanates from every aspect of our daily lives, from Oyster card swipes on London’s transport system and social platform activity to retail and banking transactions. Yet, it is questionable whether incumbent financial institutions have figured out how to leverage the data deluge to improve their services or whether they understand the so-called Digital Tribe.
“Everybody’s social and everybody’s mobile, and it’s impossible to interact with any service today without leaving a digital trail,” said Azeem Azhar, founder and CEO of social media analytics company Peerindex (pictured on Informilo's home page). "The goal for a company like ours is to take those digital trails and turn them into value for consumers," he said. And, he argues, it is time for banks to do the same. Azhar was one of a number of speakers at Emergence of the Digital Tribe: Understanding the 21st Century Customer, a June 18 conference at the London Excel Centre organized by the Anthemis Group, a company focused on reinventing financial services.
Companies in other sectors, such as retail, have learned to tap into the rich data collected. For example, Tesco collects reams of data about individuals’ habits and tastes. Thanks to their loyalty Club Card, the retail giant, which also offers financial services, knows whether customers like Azhar are buying nappies or beer, he said, so "they can therefore start to do sensible things about understanding my life stage and which financial products I may be interested in.”
By contrast, he argued, his own bank, Barclays, knew rather less about his personal life. Despite being “an incredibly happy customer” for some two decades or more, with thousands of transactions to his name, he said he doubted his bank knew which football team he supports: West Ham United. That’s the kind of problem social data can now start to solve,” he said.
Speaker Daniel Marovitz, formerly of Deutsche Bank and now founder and CEO of Buzzumi, which provides video conferencing-based sales and collaboration solutions for the pharma and health industry, was also less than impressed by the financial services sector’s approach to — and instinctive understanding of — the digital-first generation. The “digital tribe” have raised expectations, Marovitz explained, and yet the banks and other financial institutions were failing to take advantage; and not just in the area of data-mining.
The generation of people who are now around 30-years-of age and were reared on Amazon, iTunes and Google are web native. “Their experience of operating, buying and searching for information on the web is that it is incredibly easy and responsive — and their expectation is that it should be easy and responsive,” he said. But for a number of reasons including heritage and regulatory oversight, banks have taken to the issue of customer experience and ease of use with rather less urgency than almost any other service, claimed Marovitz. “The issue now is that you have a whole generation who have an expectation that, like Amazon, there should be a ‘one click to buy’ [approach]. Whether they’re getting a mortgage, payments history, or balance information out of their bank, [that generation] expect it to be just that easy.
“The challenge that banks now face is how do they recognize that when a customer goes from one type of service to another, they are not making a [psychological adjustment] that when they are banking it should necessarily be complex, cumbersome and hard to deal with,” he said. “[Banks] need to realize that from an experiential perspective, in terms of expectation from customers, the competition isn’t just [other] banks, it’s a whole universe of companies.”
Later in the debate, Marovitz argued that part of improving their services to the digital tribe could include banks using data to ensure that they offered timely and individually-tailored products and services. “Your bank could ring you up to say: ‘You know what? You’re on the wrong mortgage. If you were to pay a bit more up front over a three year period, you will save £12,000. Just imagine the impact they would have and the advocate and evangelist they would create in that customer, who would then go out and tell their story. Somehow banks have completely missed the boat on that,” he said.