FINANCIAL TRENDS

I. CONTEXT

2020 was a year of innovation and improvisation (1).

* Stephan Vogel, Ogilvy & Mather Germany’s chief creative officer.

The impact of corona on the financial industry is big, and therefore researched by many financial consulting firms and institutions.

As many consumers have increasingly turned to online during the pandemic (4), many industries including the financial sector were forced to make years worth of technology in a matter of months (1). Covid-19 made the need for innovation and digital transformation more urgent and relevant than before (2). According to a study from McKinsey the Corona crisis has accelerated the digital offering of products and services by 7 years in Europe (vs 2017 to 2019). Especially servicing industries as the financial sector were impacted (3). As a result many industries had to rethink their business model (2).

We assembled a few of the most important highlights shared by these respective institutions trying to identify what we can expect from 2021, and formulated some learnings that we can use to provide a bullet proof digital media approach for 2021.

II. Trend 1 : Consumers expect a more personalised approach

One of the most important shifts that we noted in the many researches was the impact of the consumer journey within the industry.

Due to the lockdown many consumers turned for their needs online, and many industries had to focus on the online customer experience (5). Digital and personalised services were prioritised more than ever.

The expectations of the consumers have increased and are here to stay.

Companies that can provide an optimal and personalised website experience will succeed even more, while badly designed online websites with long forms will be abandoned (6). The need for a personalized experience and offerings is more important than ever. According to a global study 40% of the banking customers would switch financial institutions for a more personalized experience (7). Although 62% of consumers expect companies to adapt their offerings based on their behaviours, only 47% is currently satisfied with the personalization they receive (7).

This personalized customer experience can make a difference as 80% of the people still perceive their banking encounters as transactional instead of the advice based experiences they prefer (7). The vast majority of banking executives (86%) are aware of this increasing need, and the importance of the personalisation of the user experience. As people are changing, banks need to keep updating their personalization strategies(8).

There still lies a lot of opportunity for the financial industry to personalize the consumer journey for their customers. In order to fulfill this need, companies need to embrace new technologies and trends to be able to quickly act on the evolving demands of the market (6).

The collection of data is important to personalize products, features and services, and to provide a better, personalised consumer experience. In order to address this need Accenture identified 4 main steps to get a better understanding of your consumer journey (8):

  • Collect your data from external sources (ex. marketing data), but also consumer feedback. Identify how individuals are experiencing your online products and services today.
  • Identify where in the consumer journey individuals might want more control over their experience
  • Identify what data is needed to understand your customers evolving, and how this can be tracked
  • Review your current data collection & strategies

How to integrate these insights within your media approach?

  • What are the omni-channel touch points you have with your clients? Map these different touchpoints.
  • Analyse which channels are activated through the consumer journey
  • Foresee personalized communication based on the consumer journey and the needs of your customers. Dynamic Creative Optimisation (DCO) can automatically support you to communicate to your audience in a personalized way
  • Map which data you are currently collecting throughout the consumer journey. Identify which data you would still be missing.
  • Check if you are measuring the right KPIs throughout the consumer journey
  • Create dashboards to quickly identify within the consumer journey where your strengths and weaknesses lie.
  • Identify where your customers drop out.
  • Which channels generate the most qualitative leads? Are you currently using the right attribution model to evaluate your different channels?
  • What is the profile of your most qualitative leads? How can we attract more customers?

III. 2nd trend : The disruption has accelerated the importance of technology within the financial industry

As mentioned before, the pandemic has accelerated innovation in the financial industry. But innovation isn’t a one shot project, it’s a continuous process that should be part of the core of your business.

While in 2019 only 42% of the banking executives expected new technologies would have the most impact on the long term, we can see the impact of the Covid-19 lock down on this need. Today up to 66% banking executives expect that new technology (AI, machine learning, internet of things, blockchain,…) will have an impact on banks through 2025 (9).

The usage of digital technology is necessary to act, analyse, predict and personalize (10) (11). One great example is Goldman Sachs who built a platform (Marquee) to integrate data from different silos. The platform combined data from transactions, research, market and other types of data to generate fresh insights in the guide decision making (11)

Many of the companies unfortunately don’t have the same resources as Goldman Sachs, but we can use this approach to identify new opportunities. To identify if your company has imbedded sufficient innovations Accenture defined the following steps (11):

  • Make a SWOT of the approach of your innovations.
  • Set organizational goals and strategies.
  • Evaluate how well-enabled your organisation and environment is for new modes of technology and innovation (11). Do you have the right tools and models in place?
  • Strategy should not be a one -shot project, but needs to be revised, evolve and encouraged (9)
  • Do you have the right people and resources dedicated to this continuous innovation (9)
  • Seek out industry and ecosystem partnerships to help your company’s effort. A strong set of partners is necessary (9)

How to integrate these insights within your media approach?

  • Identify how data and insights are currently gathered, translated and shared within the different business units
  • Do you know how digital mature your department is?
  • Is this data collection future proof? Do we collect the right information to identify future opportunities?
  • How innovative is your media approach?
  • How do you currently target your potential customers? Which first and 3rd party data do you currently use?
  • How are you currently collecting first party cookies? Do you collect the necessary information to create a future proof media strategy?
  • Do your resources obtain the right skills for the changing media landscape?
  • Use data driven models and tools such as GA360°. They can unlock new opportunities and identify insights.

 

IV. Trend 3 : Digitalization

In 2021 financial institutions will continue to be under great pressure to provide digital functionality that is both simple and fast.

Within the financial industry neo-banks have an advantage here. Besides their agility in their offerings,

they have a mobile first approach, with everything centralised digitally integrated in one app (14).

Perhaps a little overstated for Belgium, but it is expected that for some countries the shift to digital banks will generate a drop of 40% in bank visits (16).

Even though the awareness of neobanks in Belgium might still be limited (12), it is expected that they will continue to grow in 2021 (13).

As the neobanks might encounter other challenges (15), the winners within this battle can be the (traditional) banks who succeed in closing the digital gaps.

In order to close this gap following aspects need to be evaluated:

  • To what extent does the application offer more than only financial services?
  • Is your company ready to counter future initiatives as GooglePlex, where different services are integrated within one app?
  • Is your website mobile first? How is your mobile website performing?
  • Is the consumer journey different from mobile and desktop? Where are the differences? Is your content adapted to this journey?

How to integrate this in your media approach?

  • Foresee different creative assets for your mobile communication.
  • Make sure your landing page is mobile friendly.
  • Analyse the differences within your consumer journey between the mobile and desktop experience to see if you need to put other elements more forward.
  • Do you use the best creative practises for your creative campaigns?
  • Analyse which creatives are working best within the consumer journey

IV. Trend 4 : Ethic & Sustainability

Although less present due to the pandemic, the green revolution will not cool down in 2021. According to Accenture green lending will continue to thrive in 2021 (1).

With the success of the creation of banks as NewB, we believe a new banking area has arrived. With a focus on finance and insurance, we expect these new types of banks to change the financial landscape in 2021. Even though they are not operationally yet, NewB obtained the best reputation in 2020, surpassing traditionally well known banks (12).

V. Sources

https://www.accenture.com/us-en/insights/banking/top-10-trends-banking-2021

https://images.info.accenture.com/Web/ACCENTURE/%7B78085050-adc3-4a21-b9fa-6f88558947c7%7D_Accenture-Banking-Technology-Vision-2020.pdf?elqcst=272&elqcsid=131

https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/how-covid-19-has-pushed-companies-over-the-technology-tipping-point-and-transformed-business-forever

https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/a-global-view-of-how-consumer-behavior-is-changing-amid-covid-19

https://www.financedigest.com/4-key-financial-trends-as-we-approach-2021.html

https://www.europeanfinancialreview.com/2021-trends-in-the-financial-services-industry/

https://www.contentstack.com/blog/all-about-headless/digital-banking-and-financial-services-trends-2021-infographic/

https://images.info.accenture.com/Web/ACCENTURE/%7B78085050-adc3-4a21-b9fa-6f88558947c7%7D_Accenture-Banking-Technology-Vision-2020.pdf?elqcst=272&elqcsid=131

https://www.contentstack.com/blog/all-about-headless/digital-banking-and-financial-services-trends-2021-infographic/

https://thefinancialbrand.com/104418/digital-banking-transformation-priorities-trends-predictions/

https://images.info.accenture.com/Web/ACCENTURE/%7B78085050-adc3-4a21-b9fa-6f88558947c7%7D_Accenture-Banking-Technology-Vision-2020.pdf?elqcst=272&elqcsid=131

https://www.tijd.be/ondernemen/banken/belg-kent-een-op-de-drie-banken-in-ons-land/10278571.html

https://www.tijd.be/ondernemen/banken/achter-de-apps-van-de-grootbanken-zit-nog-altijd-oude-it/10247381

https://fdmagazine.be/tech/rekeningaggregatie-kan-ook-tegen-de-klant-gebruikt-worden

https://www.financedigest.com/4-key-financial-trends-as-we-approach-2021.html

https://financesonline.com/fintech-trends/

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