1. The future of finance: New banking models
As we reported yesterday, the future of financial services has become a “network of platforms that connect current providers with other peers in a way that dislodges the closed approach that financial institutions have previously used.”
The session included Peter Bakker, commercial director, Asia, King Content; Lachlan Colquhoun, chief executive, East & Partners; Aaron Boesky, CEO, Marco Polo Pure Asset Management; and moderator David Tweed, Bloomberg.
2. Fintech: Ready to challenge the traditional banking models
Fintech startups will disrupt the traditional banking industry because these players are working from a “blank canvas”, agreed speakers in a panel moderated by Karishma Vaswani, Asia business correspondent for BBC News.
“If you were to design financial services from a completely blank canvas, it would look nothing like it is today,” said Jiten Melwani, founder and CEO of Bitgame Labs. “Fintech is not weighed down by legacy technology and a diverse client base. It gets to be pretty niche and it doesn't have to service everyone. Players in this space are free to pick the markets and the technology they want.”
Aspects of the fintech sector are also not bogged down by the regulations that limit more traditional players. “Laws haven't been written yet for peer-to-peer lending,” commented James Giancotti, CEO of Oddup. “Many fintech firms have a chance to both innovate and make these laws in the mean time.”
If these startups have found a sweet-spot, a niche where the big players just aren't interested, the smaller firms have a real chance at owning a space and growing rapidly, said Janos Barberis, founder and CEO of FinTech HK. “SME lending, small loans is a niche but it's a big niche. Some P2P companies are even expanding into mortgages—and this is where the banks get worried.”
Should these companies choose to get a banking license, they still hold the advantage that the technology the firm is built with tends to be better. “Compiling compliance reports, for example, could be much faster for them giving them an edge,” added Barberis.
However, traditional banks should be looking to work with fintech startups rather than fearing them, pointed out Will Ross, partner at Nest. “Fintech can become real enablers for banks, getting them places where bricks and mortar would find it hard to succeed such as Millennials and developing markets such as Vietnam, Laos and Myanmar.”
3. Mobile has won. Deal with it.
Pick any metric you like—active users, time spent, e-commerce revenues—and mobile has won in industry after industry. Zoran Svetlicic, partner at Shift, took a wider look at how mobile best practises from other industries could be applied to mobile user experiences in financial services.
“On average, people check their mobile phones 150 times a day,” said Svetlicic. “If you suck at mobile UX, you will suck 150 times a day.”
His advice for building superior mobile user experiences can be boiled down to three principles: subtract (less is more), dissect experiences down to micro-level moments, and use mobile UX to form new user habits.
“Mobile banking apps are known to be bloated, slow, and clunky,” said Svetlicic. “Tinder is a good example of an app that 'leaned' online dating experiences down to a simple swipe.”
Similarly,OCBC bank created a simple app that allows users to check their bank balance with their fingerprint. “Rather than have an app with too many features, they focused on one feature that most people need and want, which is to check their balance, and eliminated barriers to achieving that.”
4. Use digitisation to maximise your customer’s journey
Mapping the customer journey is incredibly relevant to Prudential, said Michael McComb, director of brand and corporate affairs at Prudential during a panel moderated by Todd Handcock, CEO of Williams Lea Asia-Pacific. “The insurance business model is very disintermediated. There are sales agents who hold the customer's data and the corporation doesn't have a full view. We don't just have to digitise the overall journey, but the processes as well.”
Reaching the customer, though, doesn't have to be overcomplicated, said Michelle Toy, head of marketing and communications for BNP Paribas Asia-Pacific. “When it comes to integrated marketing, focus on sanity not vanity. It's a content-led strategy, not channel-led.”
Often, customers just want a better, more human, service experience, and flashy campaigns on social media won't necessarily deliver that. For Dah Sing Bank's SME customers, the bank introduced user guides with audio step-by-step instructions," said Joe Chan, GM of Dah Sing Bank's commercial division. “The customer isn't shown tonnes of pages, but diagrams and voices so they can really understand how to use a product. If they run into difficulties, we have a call centre manned by real people.”
The human angle is important, agreed McComb. A study by the insurance firm found that digital natives may prefer an online-only presales and research phase when it comes to buying an insurance product, but when it comes to the sales process even digital natives want an agent-relationship.
“You can't take away the human element and the importance of localisation,” said Toy.
5. Content is king: Why aren’t financial service brands doing it?
According to Peter Bakker commercial director, Asia, King Content, content marketing is a bit slower in Asia than the rest of the world for “some strange reason.” Bakker said the US takes the lead, followed by Australia, and it “gets worse in the financial services industry”.
Bakker added that the old “sell-tell-yell scenario does not work anymore, and that the average consumer has completed almost 90 percent of their buying cycle before they actually buy.
In short, his advice is that content marketing is an “always on strategy” rather than a “campaign, process, or project.”
The end goal is action, not eyeballs. The return must have direct impact on one of these areas: higher revenue, lower expenses or happier customers.
To do better and more practical content marketing: make your content findable, use distribution channels and SEO, seed it to key opinion leaders (KOLs), make your content readable, ensure it is actionable and ask yourself if it’s truly shareable.
6. Millennials: You should actually start caring about them
It's not even a question. After all, observed Barrett Bingley, director of content solutions for North Asia and Australia with the Economist Group, millennials make up a quarter of the global population and by 2017 will have the most spending power of any cohort. The real question is how to get attuned to this critical population.
Sharing Economist research, Bingley defined a 29-percent slice of the demographic as a sweet spot for marketers: the ‘Gen-narrators’ who act as “cultural DJs” and influencers. Millennials have been managing their own brands since puberty, he said. “So one way for brands to engage with them is to give them pieces of content...that help them burnish their own personal brand.”
In addition, Banks need to address a gaping disconnect between the way millennials think about money and the way financial brands talk about it, said Beverly Ho, Y&R’s Hong Kong GM, citing recent Y&R research. “They very much value experiences,” she said. “Whereas when we ask them about financial institutions, they find that the ‘bank speak’ is very much still about planning for the long term, not so much about experiencing the present.”
7. Set your standards: disruption is hard to do but innovation isn’t
This panel moderated by Meraj Qazi, digital sales director with Dow Jones, wrestled mightily with why established institutions have such difficulty nurturing innovation. While unsurprisingly failing to solve that ageless conundrum, the discussion ably explained why it exists and pointed to ways financial brands can innovate within the constraints they face.
Financial institutions took something of a beating from both Lars Hamberg, fund selector with AFAM, and Ira Dhalawong, executive director of EY. Banks tend to be full of “box-ticking bureaucrats” (Hamberg), they see digital merely as a cost-cutting tool while failing to look at how they could grow by reaching out beyond current customers (Dhalawong), they only excel at innovation when they need it as a shield against government regulation (Hamberg), and they happily import innovative superstars from tech companies only to quickly drive them away or extinguish their passion (Dhalawong).
All that said, both gentlemen spotlighted copious examples of banks that are learning to support even disruptive ideas, ‘clear the runway’ for innovative projects and allow smaller, agile teams to fail fast.
Hamberg in particular painted a positive outlook, arguing that now that they are on top of compliance-related IT projects, institutions focusing on turning their most priceless asset--transactional data--into competitive advantage using predictive analytics. He also mentioned automated advisory as a technology that is becoming viable.
Subha Hart, partner with Shift, provided much-needed reminders that to be effective, innovation must arise from customer need. In nimble, innovative companies, everybody in the organisation has a clear idea of the impact that their company has on the lives of regular people. “I’m not sure how much of that is terribly clear to everybody who works in a large bank today,” she said. “I think that’s the connection that has been lost.” You can’t import talented people from another company and expect them to drive innovation if the culture and purpose don’t change, she added.
8. Trust is not (only) a marketing issue
Brian Tang, MD of the Asia Capital Markets Institute, talked through the ongoing process of rebuilding trust after the financial crisis. While he highlighted and even praised corporate-values initiatives by banks including Barclays and RBS, Tang also stressed that trust is not about lists of buzzwords. And it’s not something marketing teams can create on their own.
“So we have all these codes of conduct which sound great—I don’t think any of us could disagree with them,” he said. “But how do you operationalise them? How do you bring them to life?” For example, do you use more sticks or more carrots? “What’s important, ultimately, is finding the best business case for restoring trust.” Doing so makes it clear that trust impacts all stakeholders, and is therefore a bankwide brand issue that everyone must help address.
Tang advocated that the industry adopt of a definition of professionalism similar to what guides better respected professions such as medicine. This relies on not only putting the needs of the client above those of the bank, but also putting broader societal benefits above even what the client may want.
“Sometimes the client wants to do something, but it’s not really kosher,” he said, citing all too familiar scandals. “But to do it makes the client really happy and by the way, you get a lot of cashflow through it.” Therefore, just holding service of the client sacrosanct is not enough.
After all, finance enables growth and innovation and ensures people’s retirement security. “Those are pretty decent social benefits of finance, but for that to work you require quality judgment of all the intermediaries that are working around us….It’s really about individual responsibility and pride in what you do. It’s about learning from the masters in terms of the art, and it’s about industry-wide standards and practices.”