It’s always around this time of year when I start to think about “It’s a Wonderful Life” — one of the greatest films ever made and my personal guilty holiday pleasure. I don’t remember how old I was when I first saw it, but from the very first watchings I understood that George Bailey cared about people, and Mr. Potter — the evil villain and head of Potter’s Bank, not the young boy wizard most Millennials know — didn’t much care for anyone but himself.
It might be an odd leap into digital disruption in retail banking, but if he were around today, I’d tell Mr. Potter that if he doesn’t start listening to his customers, he’s not going to last very long.
The reality is that retail banks like Mr. Potter’s have been slow to adapt to a new mobile consumer. And consumers, especially Millennials, continue to raise demands and expectations on banks to move more quickly.
The pressure to transform is very real: Recent reports show that nearly half of those who say the banking experience needs improvement are under 35 years old. What’s more, 55 percent of consumers say they would consider banking with tech giants — like Facebook, Apple or Google — over traditional banks for the convenience and ease-of-use they believe they would offer.
However, all is not lost for Mr. Potter (and I can’t believe I’m helping him out) as retail banks can successfully leverage next-generation technology to develop new customer experiences, and compete with the likes of Google, Apple and Facebook, even as they more aggressively enter the banking industry.
Below are some new ideas and examples to help Mr. Potter mobilize and transform his demanding customers’ experiences in new and digitally forward ways.
Inject Some Immediacy: Social Banking Bots
Contrary to popular belief, no one actually likes standing in line to talk to a teller. Why not inject a little digitally augmented interaction in the mix? Conversational and socially powered chatbots are an emerging capability that can help banks meet consumers’ demands for immediacy.
They can also help re-establish relationships with their customers in new and innovative ways. Bots can do lots of things that tellers cannot do as quickly, like quickly spit out a list of your last five deposits, all while fulfilling consumers’ desire to digitally self-service.
Social bots also enable customers to have more seamless commerce experiences. Mastercard’s Masterpass, for example, allows customers to make purchases at restaurants and retailers like Dunkin Donuts, Crate & Barrel, Kohls and more via Facebook Messenger, making payments a seamless and social part of their purchasing experience.
Bring the Bank to Them: Virtual and Augmented Reality
This one may be a bit of a stretch, but virtual reality (VR) is poised to explode across all verticals. It’s expected to hit $162 billion or more by 2020 from $5.2 billion in 2016. The question is, how can retail banks leverage this technology and make it relevant and usable for their consumers?
Think about a consumer who is digitally savvy, snug at home in the middle of winter (it snows a lot in Bedford Falls), who might need need a bit more handholding to conduct their banking. Leveraging a virtual assistant, for example, could be useful for a younger consumer who is setting up an account for the first time. For the rest of us, VR might be used to help consumers “visualize” their finances. It’s not so far fetched; French banking giant BNP Paribas, for example, has recently designed a VR-based app that allows customers to access their bank transaction records, as well as move through real life purchasing situations — i.e., the many steps of a real estate purchase — on virtual reality.
Fit Into My Life: Omni-Digital Connectivity
While digital tools like chatbots and VR can certainly help consumers connect with retail banks, when it comes to addressing more complex issues, 83 percent of U.S. consumers still prefer dealing with humans for some of their needs.
For this reason, banks need to strike a healthy balance between digital self-service and human assistance. Consider the Capital One 360 Cafes, in which bank employees (“digital lifestyle coaches”) are on hand to steer customers toward its digital tools and services (like Eno, Capital One’s chatbot) in an environment that is comfortable and fits their lifestyle. Customers who aren’t there for financial advice are still able to access the cafe’s free WiFi and enjoy a latte (hot mulled cider anyone?).
The question for Mr. Potter and his retail banking cohorts is, can they react swiftly enough to satisfy the citizens of today’s Bedford Falls? And can they design the right balance of digital experiences and human interactions that consumers demand? As much as I dislike Mr. Potter, I’m hopeful they can. And then maybe banking will be a more wonderful life for everyone.