Over the past few years, several events - including a global pandemic - have disrupted the financial sector and transformed all existing operations. The industry landscape is changing fast for customers and financial institutions are facing serious competition as they race to implement new and improved digital platforms.
Here are a few of the top trends we’re seeing that are explored in Banking on Digital Growth.
1. Consumer trust is declining
According to a poll by an analytics company Gallup, about a quarter of world consumers have 'very little' confidence in their banks. Only about 45% of the sample reported feeling 'some confidence.' One factor reported to be the cause of this fallout is that banks are not responsible. Clients don't feel comfortable due to language or class barriers.
2. Millennials are seeking credibility
Financial institutions' credibility among millennials is in the limelight after many reports show that (very) few younger clients trust banks. This large group of potential customers/members is looking to associate with institutions they believe are trustworthy and highly reputable. They have access to the internet, allowing for fast research, and finding reputable banks is easy through online research and recommendations from friends. In order to compete, banks and credit unions need to boost their digital services, digital debts, and portfolio management to meet their needs and expectations.
3. Expectations around mobile banking are growing
Banking customers want less friction and more help when interacting with their financial institutions. They want greater access to services they need on the go - including seamless mobile banking experiences. This expectation is driven by the millennial generation but has quickly been adopted by older generations who have made a rapid change over to mobile banking due to the Covid-19 pandemic.
4. Buying decisions are happening earlier
One major trend in consumer behavior is the ability to make decisions before consulting for services. With digital information literally at their fingertips, consumers can research and find what they need before reaching out and making a connection. The future is all about agility and being able to meet the customers’ needs - right when they need it.
In order to stay ahead of this behaviour - and work with it - financial institutions must be prepared to offer a wealth of information online and jump into the customer journey as soon as they are invited in. Understanding that journey - and all the motivators and barriers that live between awareness, familiarity, consideration, purchase, and loyalty - will help your organization meet current and future customers right where they are and influence their behaviour (in your direction).
5. You’re facing fierce competition in the 'red ocean'
What was previously a big blue ocean full of possibilities is now blood red due to cutthroat competition - banks and credit unions fighting for market share, competing on the same commoditized rates (that are better than ever), offering great service, and promoting a laundry list of lookalike product features and benefits. Organizations that can define their brand and speak directly to their customers are the ones who will stay afloat.
6. There’s a transformation in progress
The introduction of neobanks and digital lenders is having a significant impact on traditional banks and credit unions. These major shifts force all current players in the industry to evolve - or risk extinction. Organizations that fail to adapt may experience a massive reduction in market share at best… or at worst, could cease to exist. The flip side of this is the forced growth and new ways of thinking that are challenging all players to adopt new technology, products and service models, faster than ever before. Competition can make us all better and refresh our old way of thinking about a previously slower-moving industry.
Are you ready to think about your credit union in a new way? We’d love to chat about the trends you’re seeing - and how Metric might be able to help lead your marketing into new territory. Talk to Metric Marketing today.