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Retail banking challenges


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Russian bank's brands are desperate for change!
They do have something to learn from retailers. Can the HI-Tech approach come with HI-Touch?

Published in: Economy & Finance

Retail banking challenges

  1. 1. Clive Woodger February 2014 Retail Banking Challenges Creating a first choice customer experience Hi-Tech 3 High Touch ?
  2. 2. 1. Retail banking challenges - Creating first choice customer experience The title image, HI-Tech with High Touch questions whether new technologies which have so significantly transformed banks take into account the importance of human interaction in achieving a positive brand perception. 2. Presentation Agenda The topics to be covered are outlined starting with review of changing customer needs and aspirations. Latest trends in retail and in retail banks concepts are considered. The last section takes a look at the motivation and engagement of staff – High-Tech with High-Touch! 3. SCG London- Who we are Some images of our work in retail, corporate, financial and real estate sectors. 4. SCG London – What we do Some images of our work covering brand identity and communications, brand architecture and environments across various sectors. 5. SCG London – Who we work for The range of our projects and clients from multinational to local specialists. 6. Creating a first choice customer experience The three touch point mediums ie. the physical branch interactions, the human contact opportunities and the digital technologies and process all potentially cross over and ideally create a positive synergy of experiences. The challenge is how these touch-points achieve a consistency of message, personality and performance. Ultimately an effective brand strategy must address these interactions to differentiate as a bank brand and be measured by the criteria as listed. 7. Understanding customers - Changing customer needs and aspirations The images of the audience is a reminder that every bank has users who are watching and judging your image and performance. Are you really custotmer centric? 8. Different customer generations – Changing perceptions and priorities From generation Z who have never experienced the pre-internet world to Baby Boomers. The key generation, Millenials, are starting to set the agenda for retailers and banks. 9. Key influence generation The Millenials values, expectations and aspirations are defined. The statistic from Deloitte noting that by 2015 they will represent 75% of the workforce and influence 74% of buying decisions needs to be addressed by retailers and banks. 10. The Millenial takeover More statistics on Millenials. The interesting feature is the worldwide similarity of this generation due to globalization and social media. 11. Appealing to Millenials Mindset Some attributes and added values that banks, for example, as a service brand need to address and provide. 12. New way of connecting A reminder that new social media channels provide opportunities for brand advocacy but also the potential demolition of hard earned reputation. 13. Breaking the rules. Diesel reboot campaign reflects the power of new communities of interest and the tribal sharing of experiences. 14. Banking for Millenials Frank is an example of how to appeal to tech savvy `millenials’, a clever name, a brand that is more of a fun shop and advertising that exploits the name proposition.
  3. 3. 15. Women While it is accepted that banks should appeal directly to half the world’s population, the other half still seem to dominate the way banks are organized and run. 16 - 17. Retail Trends and predictions Some classic headlines on retail issues 18. New brand concepts As designers of latest retail and banks we are highly aware of new global developments. Many banks are desperately trying not to be seen as traditional banks, and these words and images perhaps show a sector that clearly is not sure how best to provide a first choice customer experience. It begs the question what do customers really want from their banks and the changing function of branches. 19. Retail trends…Branch concepts Unlike retailers, banks as service brands without tangible products have had to embrace new technologies and direct human interactions opportunities more readily. So while latest retail trends are clearly relevant for banks in showing and understanding of changing consumer demands from retail outlets, banks can equally teach some retailers how to integrate technology more effectively in the retail store environment. 20. Digital convergence – a seamless experience? A re-emphasis on the need to provide a synergy across all potential touch points. 21. Multi Channel Integration – the Apple experience While Apple is always trotted out as an innovative brand there is no doubt they created a role model for many retailers in changing the concept of store organisation and design. 22. Multi Channel Integration – Citi Bank This Citi bank is a typical example of ‘smart’ banking. 23. Multi Channel Integration - FNB South Africa But is this going too far? Hardly a human in sight, a cold sterile hospital environment? 24. Multi Channel Integration – Traditional retailers Only now discovering the potential of tablets in terms of enhancing efficiency, informing and inspiring customers. 25. Multi Channel Integration – Traditional retailers Some examples in different sectors, demonstrating the use of screen technology to advise, engage and trigger sales. 26. Multi Channel Integration – Argos catalogue retailer This traditional UK catalogue showroom retailer has completely changed its customer experience, converting its city units in highly efficient but pleasant product pick up points. 27. Self Service Innovation – empowering retail customers These four examples show some latest retail innovation concepts. A jeans fashion shop based on a customer app that delivers the right size and style to a dressing room, a smart shopping trolley, 360 degree product scanning in an ASDA Walmart store and a Korean TESCO store with no product but ‘virtual’ merchandising. 28. Self Service Innovation – Empowering banking customers These American examples of ATM’s incorporating real person interaction technology provide the immediacy of personal service with the efficiency and the convenience allowed by technology. 29. Self Service Innovation – Empowering customers and staff While this Australian National Bank example is not the most attractive in terms of interior environment, it is a good example of empowering staff with training, Ipads and app technology to enhance customer service. 30. The value of Values – ethical retailers Balancing quality, price, experience and matching ethical values is an increasingly significant factor in differentiation. This is an interesting ethics based concept which also works commercially.
  4. 4. 31. The value of Values – Ethical retailers H&M’s ‘Conscious Collection’ shows how fast fashion has recognised the need to respond to the concerns of customers, wanting to feel good about their choices. 32. The value of Values – Ethical Start-Ups Zady’s production transparency certificate and use of social media is a response to consumer needs to justify their purchase decisions. 33. The value of Values – Ethical retailing/ Banking The Coop in the UK is a classic example of using ethical values to differentiate their offer. The only problem is that they then need to ensure they ‘walk the talk’ and recent exposures on their banking incompetence and poor management has affected their reputation and brand equity. 34. The value of Values – Ethical Banking This Canadian example, Vancity, takes its ethical messages and profile as a basis for creating a distinctive branding and communication style. 35. Emotional Values Creating an effective emotional connection with your target audiences is the basis for successful branding. McDonalds knows this very well as a successful global brand. Their recent advertising in different countries cleverly relates to the every day needs and issues of their varied customer profiles and mindsets. 36. Emotional Values – the messages is in the name ‘Friend’ – The name, message and imagery says it all for this bank. 37. Emotional Values – Reflecting local culture Reflecting your local market values, sensitivities and culture can be an effective differentiation strategy in contrast to global banks with a more impersonal corporate image. 38. Emotional Values – Regaining heritage The Lloyd’s rebrand in the UK emphasises the heritage and the latest advertising is based on traditional life events and needs. Whether this really addresses the basic mistrust of banks in the UK is questionable. 39. Flash/Pop-Up retail – Generating buzz The trend for digital retailers to want to get physical using pop-up stores is in parallel with traditional retailers wanting to create temporary outlets in unusual venues to create awareness, etc. Virtual pop-up stores where a location is communicated and people converge to share a virtual experience on their mobiles and tablets is another example of creating shared brand experiences. 40. Pop-up banking – Extending reach These examples of Pop-up banks show the potential for going where people are in shopping centres and temporary locations. 41. Lifestyle stores – Digital backlash Some retailers in showrooms are reacting against high-tech digital environments and offers. This Italian example deliberately creates an interesting tactile experience and sense of place. 42. Lifestyle Banks –Digital backlash - People’s choice This Australian bank deliberately encourages people interactions with less screens and a relaxed bright atmosphere. 43. Lifestyle Banks –Digital backlash - Virgin Virgin are investing in comfortable lounges and emphasising more soulful communication message. 44. Lifestyle Banks –Digital backlash – Jyske Bank The Danish bank positively encourages customers to relax, take time out and treat the branch as a social destination.
  5. 5. 45. Lifestyle Banks – Café banking More examples of banks trying not to be banks… 46. Green retail Bringing plants and garden features into retail stores a common trend to encourage browsing and dwell times. 47. Green Banks Some banks are similarly ‘greening’ their branches to bring natural materials and organic features to create more relaxing and pleasant destinations. 48. Brand Experience stores Nike has been creating ‘worlds’ for some time to complement their internet retailing. The comment that it is not a store but ‘ an ad with walls’ is interesting but they clearly work and can be justified as PR investments rather than direct selling machines. Many regard bank branches as expensive billboards… 49. Brand experience stores A Levis world is similarly all about brand immersion not about selling product. 50. Brand experience banking – Metro Bank Creating a different brand experience was a fundamental aim of Metro Bank in the UK. As a new entrant in an established banking market, it has deliberately set itself apart from other banks by adopting a very ‘retail store’ feel and approach, in terms of fast customer service and direct messages and promises. 51. Hi-Tech with Hi-Touch These examples combine the best latest technology with a positive human touch. So how do you differentiate with your people? 52. Hi-Touch – Do your people make the difference? These images of positive happy smiling people in the retail and banking sector show ideal scenarios… How real is this? 53. High-Touch objectives These messages recently put out by Barclays seem to imply that the Bank has only just realised that they need to meet the values and actions that any good contemporary organisation should reflect and achieve. It is an admission that they have not achieved this ‘best practice’ in the past and now have to make this a ‘transformation’ strategy. Interestingly, a few years ago their advertising strapline was about being the biggest… how times have changed! 54. A conflict of values So much for a joined up PR initiative! Having announced their new values Barclays then admit then axing 12000 jobs and paying top executives higher bonuses. 55 - 56. HSBC Our work with HSBC to create a global approach to creating work places, which would engage and motivate staff and management, is an interesting example of a bank addressing the need to invest in their human capital. We worked with the Bank to create environment that would reflect their special internal values and appeal to the varied mindsets and cultures, represented by their 750 offices in 87 countries. 57. Creating a first choice customer experience The presentation started with this slide reflecting on the need for creating an effective brand synergy of message, experience and behaviour across the Human, Branch, and Digital interactions of banking. 58. High-Tech with enhanced High-Touch The message of this slide should therefore be clear. Never forget humans want to relate to humans but with the convenience and efficiencies of High – Tech. This is the challenge in creating a first choice customer experience - the fundamental requirement for a successful branding strategy.
  6. 6. Presentation Agenda • SCG London Overview • Customers - Generations/ Millenials/ Mindsets • Retail Trends/ New Branch Concepts • Multi Channel Integration • Self Service Innovation • The Value of Values - Ethical/ Emotional • Pop Ups • Digital Backlash • Brand Experience • Hi-Tech/High Touch
  7. 7. SCG London: Who We Are... • International strategic branding and design consultancy • We work in the retail, financial, real estate and corporate sectors
  8. 8. SCG London: What We Do...
  9. 9. SCG London: Who We Work For... Example 1: The latin logotype in horizontal format reversed white-out of background colour Example 2: The latin logotype in horizontal format within the exclusion area (freespace) Yeni GLOBEX BANK logosu Eski GLOBEX BANK logosu
  10. 10. Human Call Centre ATM Counter Interview Website App Phone VIP Club Social.. pit stop Face to Face Video Phone DigitalBranch Creating A First Choice Customer Experience Differentiation Personal Service Convenience Efficiency Value Pleasure? Optimum customer engagement across all brand touchpoints: human, physical and digital ...consistent...coordinated...satisfying... Brand synergy
  11. 11. Understanding Customers... ...changing customer needs & aspirations Customer centricity?
  12. 12. Different Customer Generations... ...Changing Perceptions & Priorities Millenials/GenY 1980 - 2000 Early teens - Early-30s Demanding, internet savvy, instant gratification. The ipad generation Gen X 1965-79 Early-30s to mid-40s The ‘focused, keep your heads down generation’ Gen Z 2000 - present Children The first generation never to have experienced the pre- internet world Baby Boomers Pre 1965 Late-40’s+ Regarded in the West as the ‘have it all’ post war generation
  13. 13. • Tech-savvy • Grasp new concepts quickly • Enjoy change • Like personalisation & customisation • Seek stimulation, get bored easily • Social, connected, consultative • Caring, motivated by their mission • Want to make the world a better place • Major influence on baby boomers “By 2015 Millenials will be 75% of workforce and will influence 74% of buying decisions” - Deloitte Key Influence Generation
  14. 14. Source: Hanson Dodge Creative “Thanks to globalization, social media, the exporting of Western culture and the speed of change, Millennials worldwide are more similar to one another than to older generations within their nations.” Time Magazine The Millennial TAKEOVER
  15. 15. Loyal Reward me quickly & make it easy Make it enjoyable I love a game; guerilla & viral messages are more fun Know Me I’ll let you in, but use my info to send me relevant stuff Check it out Shopping is a mission & I rely on online referrals, price comparison & reviews Recessionistas Anxious about money but I aspire to be responsible with it Values Success should be measured by more than profit Appealing To The Millennials’ Mindset
  16. 16. New channels enhancing opportunities for brand advocacy New Ways Of Connecting
  17. 17. Breaking The Rules Dieselreboot campaign - bringing the brand to a new generation. Features “the new heroes of today’s generation of digital influencers and creators”. Tumblr community and meetups.
  18. 18. FRANK (Singapore) “A brand new way to bank”. Aimed at young tech savvy ‘Millenials Has captured over 26% of Singapore’s youth market. Banking For Millenials
  19. 19. • Women buy 65% of cars and make 81% of financial decisions • We’ve already got women only floors in hotels, women only nightclubs, women only gyms and women only department stores. • How long before we see women only garages and women only banks? Women “Women are the biggest market on earth but in financial services they are often ignored - because most of the world is run by men.”
  20. 20. Retail Trends & Predictions... organizations streamlining their brick-and-mortar presence less is more ETHICAL CONCEPTS retail entertainment
  21. 21. More Retail Trends & Predictions... more self service
  22. 22. New Branch Concepts lounges... hubs... mini branches... financial spas... cafes... chill out zones... community centres... play areas... supermodern... high fashion... retro... traditional... relaxing... stimulating... styled like shops... homes... conservatories... airports... nightclubs... libraries... boutiques...
  23. 23. Retail Trends Branch Concepts Banks learning from retail? Retail learning from banks?
  24. 24. Digital Convergence - A Seamless Experience? • Retailers are reinventing themselves in response to the impact of the internet • Customers expect integration and are impatient for it to become reality “App-wielding customers make twice the shopping trips per month and spend 40% more than non-app users.” - Walmart “From inspiration to purchase, technology plays an integral role in creating the consumer experience.“
  25. 25. • Pioneered removal of EPOS terminals and introduction of handheld systems for staff to process transactions • An entirely different store look and feel Multi Channel Integration - The Apple Experience “Technology is better if I feel that I’m working less. If I’m not having to think or do things or work, it’s a better product.” Apple co-founder Steve Wozniak
  26. 26. • Interactive media wall and work benches • Touchscreen planning table • Digital swipe service browser • Assisted service at “360 Station • Live video conferencing with a remote specialist CitiBank smart banking concept Multi Channel Integration - The Apple Experience
  27. 27. Multi Channel Integration - The Apple Experience • Sophisticated augmented reality app • White walls, exposed ceiling, hard surfaces • High tech toys in a spartan environment? FNB - South Africa
  28. 28. “In 2014, more retailers will give customers the ability to interact and complete transactions on their own terms” • Act as a flexible transactional POS system • Help reduce queues • Make the payment process mobile, faster, simpler, more engaging • Improve customer information eg locate and order out of stock merchandise, check loyalty points • Interactive marketing, displaying images and video content on ranges, products and special offers • Customers can use wi-fi to access the internet on their smartphones/tablets Only now launching instore tablets Multi Channel Integration - Traditional Retailers
  29. 29. Multi Channel Integration - Traditional Retailers “53% of Millennials say their favourite retailers offer an omnichannel experience” - Survey Monkey “Technology enables shoppers to explore the breadth of what the store brand has to offer”
  30. 30. • 60 second Fast Track collection service for online or mobile purchases • Digital display screens replace static sales literature and paper posters • In-store iPads with expanded shopping apps - product videos and reviews • Free WiFi in stores “We are seeking to reposition our stores to support a digital future - in which digital channels are the primary interface for customers, but stores continue to be critically important as a national network for product collection.” Argos catalogue retailer Multi Channel Integration - Traditional Retailers
  31. 31. High Fashion Automation Self Service Innovation - Empowering Retail Customers Smart interactive shopping trolleys 360˚ product scanning Tesco Korea Virtual Stores “Innovation is being driven by consumers’ desire for speed, information and convenience.” “Many of the most important technological ideas - from retail apps to contactless payment - have come from a need to smooth the shopping process.”
  32. 32. Self Service Innovation - Empowering Banking Customers Personal Teller ATM’s with ‘uGenius Technology’ enable customers to interact with a real person via 2-way video. Personal service with tech efficiency. Coastal Credit Union (USA) SECU (USA) Dollar Bank (USA) First Ontario (Canada) Mid Hudson Valy (USA)Bank of America (USA)
  33. 33. Self Service Innovation... Empowering Customers And Staff • 25% smaller than traditional branches focused on serviced self-service • All staff equipped with iPads with NAB ‘Come Help Me’ interactive apps • Large touchscreen - staff encouraged to engage in customer conversations • bar with iPad and smartphones to demonstrate internet banking • High level of staff training National Australia bank - smart store interactive format
  34. 34. The Value Of Values - Ethical Retailers “Shoppers are becoming increasingly savvy and better than ever at finding value. This doesn’t always mean the lowest price possible; customers increasingly expect the right choices in product quality, and the right values in terms of provenance and ethics.”
  35. 35. Conscious Collection launched 2011. Made from environmentally friendly and recycled materials The Value Of Values - Ethical Retailers Lanvin for H&M fabric run-offs sold as H&M‘s new Waste collection Discount incentives for recycled clothing Brands are repackaging & repositioning themselves
  36. 36. The Value Of Values - Ethical Start Ups “For every purchase made on Zady, an artisan launching a micro-business in the developing world will be provided with the crucial funds they need to grow their business and revive their traditions.”
  37. 37. The Value Of Values - Ethical Retailing/Banking The Co-op, UK “Co-op Bank scrambles to convince customers its ethical stance will survive” - The Guardian Responsible finance Supporting co-operatives Responsible retailing Inspiring young people Tackling global poverty Protecting the environment Democratic control Keeping communities thriving
  38. 38. The Value Of Values - Ethical Banking “Our vision is to redefine wealth in a way that furthers the financial, social and environmental well-being of our members and their communities.” Vancity, Vancouver
  39. 39. Emotional Values McDonalds - Series of emotionally charged advertising campaigns “We all have McDonald’s in common” - storytelling about difficult relationships “McDonalds is for everyone”, “Just Passing By” - narrative poems about people’s lives
  40. 40. Emotional Values - The Message Is In The Name Friend - One of Alabama’s oldest community banks. “True to you”.
  41. 41. Emotional Values - Reflecting Local Culture Trailhead, USA Rebranding reflects rugged Oregan values “Individual expression, casual confidence and commonsense wisdom”.
  42. 42. Emotional Values - Regaining Heritage • 250-year-old bank relaunched as result of TSB sale - return to original name • Emphasis on heritage symbol and colour with contemporary look Lloyds bank
  43. 43. Flash/Pop-Up Retail - Generating Buzz • People are getting bored with same brands in same places • Pop up retail is exciting, innovative and interactive • Test product, build brand awareness, target new audiences • Tap into ‘massclusivity’ Benetton, New York pop up store looks like Pinterest with Twitter style narratives “Online retailers will increasingly look to to establish a physical presence, often through pop-ups”
  44. 44. PNC, USA Pavement Pop-Up Pop-Up Banking - Extending Reach • Extend High Street networks • Reach new customers outside usual branch environment Barclays, UK Shopping Centre Pop-Up
  45. 45. Lifestyle Stores - Digital Backlash • Ways to differentiate shopping experience • What’s old is new, tactile, content rich, lifestyle feel • Browsing, inspiration, entertainment • Encouraging customers to dwell • A refocus on the high street “Less about a need, more about fulfilling passion - about the joy and serendipity that often comes from physically shopping in stores.” Nonstante Masrras, Milan
  46. 46. Lifestyle Banks - Digital Backlash • Bright, fresh colours • Emphasis on relationships and face to face conversations Peoples Choice, Australia
  47. 47. Lifestyle Banks - Digital Backlash • “Soulful” campaign with retro style illustrations. • TV/ Piano lounge - like a hotel Virgin Money, UK
  48. 48. “Most radically, we really want to leave people alone in branches. Instead of an emphasis on selling, the approach is all about letting customers relax.” Lifestyle Banks - Digital Backlash Jyske Bank, Denmark “Open comfortable space plus a visual experience with multiple plasma screens”
  49. 49. Lifestyle Banks - Café Banking Expresso bars, sofas, newspapers, chalkboards, chandeliers… Westpac (New Zealand) State Farm (USA) ING (Europe)
  50. 50. ‘Green’ Retail Hermes, Tokyo Sophisticated interior plant features Cotton, Adelaide Urban garden
  51. 51. ‘Green’ Banks “A green house concept, a place where plants grow and are nurtured.” Skandia Bank, Sweden
  52. 52. Brand Experience Stores “Don’t call it a store, call it an ad with walls” - NY Times Celebrating the passion for sport Nike
  53. 53. Brand Experience Stores “Customers now demand more from physical stores: more excitement, outstanding service and a more personalised experience.” Customers are taken on a journey through the origins of denim and the brand’s evolution Levis
  54. 54. Brand Experience Banking • New entrant ‘Fast food’ style banking • Challenging existing banks, gaining new customers but £100m loss in 3 years • Owner runs Burger King franchise in USA Metro Bank, UK
  55. 55. Hi-Tech With High Touch Commonwealth Bank (Australia) Docked iPods & iPads for exploring mobile banking. Touchscreen terminals with product information. Branch staff have Macbook laptops Bank Audi (Lebanon) - ‘Novo’ Kiosks ‘Virtual’ smart kiosks in shopping centre locations Mountain America Credit (USA) Has put ‘technology champions’ in every ranch to help customers migrate to online and mobile banking
  56. 56. High Touch - Do Your People Make The Difference?
  57. 57. We are ‘Go-To’ for our customers and clients Our colleagues are fully engaged We positively impact the communities in which we operate. We act with integrity in everything we do We create sustainable returns above the cost of equity “The bank has outlined how it aims to achieve the “right culture” across the business, stating a series of aims against the “5Cs”, denoting customer and client, colleague, citizenship, conduct and company.” High Touch Objectives...
  58. 58. A Conflict Of Values?
  59. 59. HSBC · Branded office workplaces · To engage... to motivate... · 750 offices in 87 countries · Strategic global graphics concept to reflect values and attributes: open, dependable, connected · A unified look and feel adapted to suit market and cultural mindsets · For head and general offices, data centres, call centres New values – new environment
  60. 60. HSBC
  61. 61. Human Call Centre ATM Counter Interview Website App Phone VIP Club Social.. pit stop Face to Face Video Phone DigitalBranch Creating A First Choice Customer Experience Differentiation Personal Service Convenience Efficiency Value Pleasure? Optimum customer engagement across all brand touchpoints: human, physical and digital ...consistent...coordinated...satisfying... Brand synergy
  62. 62. Hi-Tech With Enhanced High Touch
  63. 63. SCG London 8 Plato Place 72-74 St Dionis Road London SW6 4TU +44 (0) 20 7371 7522 Thank You