3 reasons why digital transformation is essential for financial services
I was recently at the Fintech conference in Edinburgh where I noticed a lot of discussion focusing on reinventing the traditional view of financial services and the need for firms to innovate to keep up with increasing client expectations.
The cost of acquiring new customers in the financial services sector is at its highest, and the cost of retaining customers is even higher. According to The Guardian, in-branch bank visits are down by 32% and the generation now coming into wealth is looking for more than a bank with just a solid reputation ‒ they’re looking for innovation and being able to offer customers a leaner and more accessible user experience will be key to gaining a competitive advantage.
From mortgage lending to wealth management, an opportunity to lead the financial services charge into our digital future is presenting itself and digital innovation is becoming fundamental to business strategy.
1. Customers demand “self-serve” digital tools
You want to make it as easy as possible for customers to engage with the business and the services provided, and that means adapting to changing customer demands.
Between 2004 and 2014, the percentage of Britons managing their personal finances by visiting physical branches dropped from 75% to 54%, and this is expected to fall to just 35% by 2019. Conversely, those who used the internet rose dramatically from 29% to 74%, and use of smartphone apps rose from 0% to 14% (Statistics from statista.com).
So, with customers leaning heavily in the direction of online and mobile avenues for managing their finances, it’s only logical that these are the areas financial services need to occupy as well. That means embracing a few key technologies to ensure maximum accessibility:
- Mobile technology, including apps
- Self-serve digital tools
- Social tools and automated communications
Many financial service providers rightly value the personal touch within their client interactions, and have concerns that embracing digital methods of communications and automation will have a negative effect. In fact, 77% of financial advisors who conduct their business with digital and social tools see improved client retention (Accenture Generation D Research). That’s because digital doesn’t have to mean impersonal – your communications with clients can be more personal than ever, with the added benefit of being faster, more convenient, and more effective. According to the Future of Finance report published 2015 in collaboration with Deloitte, the World Economic Forum found personal and low-cost communication methods to be the key characteristics of the future of wealth management.
2. Streamlining internal processes to help employees be more effective at their jobs
Keeping in touch with clients is a key part of any business not only financial services, but it doesn’t have to eat up every hour in the day. Automating essential communications allows you to effortlessly maintain contact, which means you can spend less time sending endless emails and more time working to give clients your best.
Reduce time spent going back and forth with clients trying to set up a meeting when it could be done in just 40 seconds with online scheduling. Make it fast and simple for your team to find customer details and contact them directly from an internal CRM suite. And, rather than go to the enormous effort and expense and throwing out all the processes and systems you have in place, find ways to improve, streamline, and simplify what you already have.
3. Security is top priority
When you help clients with their money, you need to know their sensitive data is safe with you, and embracing automated tools doesn’t have to mean more risk for your firm or your clients. Source tools with excellent security credentials, that are compliant with Cyber Essentials standards, and which have a proven track record of robust data security (such as Appointedd, for example). This will put both your and your clients’ minds at ease and improve the appeal of your services.
The future of financial services is bound to bring exciting changes, and taking steps now towards digital transformation will safeguard your business and help ensure growth and a thriving industry in years to come.
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This article was first published on LinkedIn