Amazon recently bought over the legendary MGM studios, extending their stake in the film and television business.1 Naturally, fans asked what the future would hold for the super spy – would the franchise branch out into TV shows like the Avengers or stay true to its movie roots? The answer came from Barbara Broccoli, co-owner of Danjaq LLC that owns half the rights to the franchise. She said, “We make these films for the audiences…Our fans are the ones who dictate how they want to consume their entertainment. I don’t think we can rule anything out, because it’s the audience that will make those decisions. Not us.” Broccoli’s statement is interesting because it places the future of 007 in the hands of his fans. It will go in whichever direction that fans and viewers want it to go.
Movies are understood to be the ultimate expression of creativity. Genius scriptwriters, visionary directors, and brilliant actors, form the faces of the world of cinema in popular imagination. But it is a business which must be profitable, and in the 21st century, this depends on understanding and delivering on customer expectations. If viewers want to see James Bond in 45 minutes episodes, then that’s what they will get. This is the crux of any business today. The customer is king and is at the very center of business strategy, roadmap, and implementation. Because business success today depends on delivering what the customer wants, when they want it and how they want it. Banking is no exception. Modern customers expect a degree of personalization, empowerment and choice that was previously unheard of. And fintechs and technology giants operating in the financial services space are ready to give them all that and more with an innovative tech enabled customer centric business model.
Traditional banks today must relook at their vision and revamp operations to put customers at the heart of their strategy. Customers want products and offerings that are personalized to make sense for them. Empathetic banking models that respond and even anticipate a customer’s need and addresses it effectively will spell the difference between success and failure in an increasingly complex and competitive market. Relationship-based pricing models are gaining traction and banks need to leverage the high degree of customer trust they enjoy to deepen customer associations and loyalties. And to do this they must effectively utilize customer data within the organization. Data stored across silos can only present a fractured representation of customer behavior. Banks must first break down organizational silos to consider customer data in its entirety and then use powerful analytics tools to gain intelligent insights into customer behavior across touchpoints. Armed with this information, banks can then craft hyper-personalized offers, products, service, and product bundles and even create better pricing strategies. Personalized offerings will result in happier customers and help establish long term customer loyalty.
In fact, while banking as an industry will exist in the future, banks in their current form will most likely not. Footfalls into branches is already on a decline as customers prefer online and mobile banking. And banking is increasingly getting embedded into other services. Case in point – Ikea’s purchase of 49 percent stake in Ikano Bank that puts banking at the heart of its retail business to make shopping an easy seamless exercise.2 Customers can avail of banking services in Ikea stores, to buy Ikea products, avail of associated services and more. Banks have the unique opportunity to establish themselves as curators of a comprehensive ecosystem of allied third party services that address customers’ needs. For example, a customer taking a home loan from a bank can also avail of discounted deals on interior design, electronics, furniture, and furnishings from the bank’s ecosystem partners. Banks must move now to become orchestrators and owners of this ecosystem, or they stand the risk of becoming yet another commodity on a platform owned by someone else.
Banking today is not just about offering a static list of services. Much like James Bond, it is about delivering what customers want, how they want it. Despite the high degree of trust that they put in banks, customers want a degree of personalization and on demand access that is not possible to deliver with legacy systems and outdated business models. Banking transformation is no longer a choice, it is a business necessity. Banks must partner with Fintechs to deliver the uberized services that customers expect. Or they must work with third party vendors who can implement a technology middleware over their legacy cores to enable the advanced analytics, and AI solutions they need to power this new age of banking.