43rd Efma Congress preview
The 43rd Efma Congress will take place from Thursday 29 to Friday 30 October 2015 in Amsterdam. We caught up with three of the speakers to find out what they’ll be speaking about and to hear their thoughts on the industry at present.
What will be the main focus of your presentation at the Congress?
Javier San Felix, senior executive vice president, global head of retail and commercial banking, Santander: My presentation will be focused on driving transformation in retail banking to regain customer trust, looking more in depth into different issues such as: why retail banks really need to transform and what is the ultimate goal of such a journey; why omni‐channel and customer centricity are two core concepts to drive change; what is the role of corporate culture in making it happen; and how to extract value from the local and global effort, based on our experience in Santander.
Suvrat Saigal, managing director and head of global retail, NBAD: The role of understanding our customers through analytics will be key for banks in the ’post branch world’ as we drive insights from asking what the customers need to inferring the customer behaviours through stronger analytics within the banking system. The types of inferring customer behaviours will be highly dependent on factors such as: demographics and transactional data for predictive correlation analysis; big data coupled with CRM and market insights for a 360 degree customer view; and digital footprints along with the customer lifecycle model. With a more sophisticated view of customers across multiple types of inference models, the customer’s voice becomes clearer for acquisition targeting and cross-sell development of the relationship and loyalty within the retail banking space.
Also, the age of digitisation and the move away from the traditional brick and mortar business of retail banking will drive the question of whether digitisation’s role is to reduce the cost structures through efficiency or to encourage top line revenue growth through a more sophisticated customer interaction. The strategic agenda for digitisation probably needs to be addressed through the interaction it will follow with the customers. Will loyalty be sacrificed in the face of digitisation, given the sophistication and ease of customers to shop around digitally? Will human interaction be deemed necessary given digitisation? and at which period of time within the customer’s lifecycle should we consider the human interaction model?
Christina de Villeneuve, global head, Hello Bank: I will be sharing the specific example of launching a digital bank well-within a long standing banking group. An important specificity of Hello bank! is that it is fully integrated within BNP Paribas, as are all of the group’s businesses. This is core to the value proposition and was reflected in our brand from the start with the ’by BNP Paribas’ tagline. I will of course update the audience on how Hello bank! is doing and share some insights on our journey from banking to digital banking and the skills we are acquiring to be able to compete in the new world.
What do you think will be the biggest benefits of attending this event?
de Villeneuve: It will be very useful to catch-up and discuss openly with my colleagues across the various European markets. With the pace of the transformation taking place in retail banking it is sometimes hard to keep track and this congress definitely helps.
San Felix: I think there are many reasons to attend this event. In my opinion, the most important benefits are to stay current on trends in the industry and become connected to key influencers. These forums also increase visibility and allow to start relationships that will lead to strategic alliances, joint ventures or referrals, and also to find suppliers and solutions. EFMA provides a unique opportunity to meet all these expectations.
Saigal: We should see the exchange of ideas and retail banking business franchise across a diverse geographic and type of retail banking models across both government, semi-government banks dominant in own country versus the global international players working around and catering their models to individual markets. Key innovative topics will be shared, both from the retail franchise business and also from vendors and consultants in these key areas of focus will give the participants a broader view from all relevant parties concerned.
How can banks stand apart from the competition in today’s ever-changing market?
Saigal: Retail banks will have to be more systematic yet flexible in the way they deal with the customers in future. Internally, banks will need to envision organisational structures that are both financially viable and, in tandem, drive a culture of efficiency and delivery across the organisation.
de Villeneuve: First we have banking know-how, it still remains both valuable and relevant and maybe more than ever in the world we live in, full of opportunities and changes in plans. Then we have the ability to invest heavily where needed, a strong staying power and a track-record of adaptation. We also have a very large base of customers who, among other things, trust us to ensure the security and the privacy of their data and transactions, through decades and to the highest level of standards; this is one concern that is clearly coming back to the fore.
San Felix: Nowadays, the majority of products in the banking industry tend to be commodities. What can differentiate one bank from the rest is the way to do banking: how to reach the customers and how to develop this relationship; in short, the customer experience differentiation. For that reason, in a digital world the main challenge for the banks is to develop new omni‐channel customer propositions to attract and retain customers. This challenge is global and gaining momentum as banks try to come to terms with technologies that have already transformed sector after sector; to be digital is not distinguishing, it’s really a must‐have. But to make sure we do it right with the new technologies as well, we have to create the same ’wow’ moments in our electronic channels as we do in our branches. Our customers should feel: ’This bank is thinking about me’
What are the biggest areas of transformation that major financial institutions need to undergo in order to rise to the challenge of digitisation?
de Villeneuve: The strong contenders are now fairly advanced in embracing new customer needs and the new type of relationship with them: our various activities have all learnt and adopted the new ways of doing business. So the picture is quite clear in terms of where we want to be, although different institutions will of course take different strategic options. The challenge today is how to get there, and fast enough: how we can carry digital transformation within the organisation, so we can actually deliver it to clients? It requires a change in the way we operate, our organisation and processes, a change of mindset, including being more open and forming new partnerships, and the acquisition of skills that we didn’t need until now but that are quickly becoming critical to be able to compete.
San Felix: Digitisation is challenging the ways banks operate. Yet it also represents a significant opportunity because are not fleeting changes: digital transformation is crucial and we need to make more investments in IT infrastructures and areas that we might not have made a few years ago. Technologies for mobile computing, cloud services, big data and analytics, and also social networking are key on the path towards digital transformation. Technology investments will deliver just a fraction of the potential benefits as digitisation will generate an explosion of channels available to the public. In this scenario, we should be able to catch up to customers and create new forms of value.
Saigal: Investing in transforming the bank from the typical branch operation managing customer engagement into a more digitised retail bank, where customers would have the ability to manage their accounts through online banking, perform banking transactions through mobile banking at their own convenience. Retail banks should also transform the way customers’ voices and views are being looked at. Banks need to move away from asking what customers need and to formulate an inference model to predict how customers will behave instead. Investments into systems, predictive models and market research are ways for retail banks to target customer needs with specific offers based on these inference model.
Typical non-banking but highly sophisticated digital operators that are far ahead on the digital curve might be suitable for retail players to collaborate with. We should see that happening more, realising a drastic transformation.
What do you believe the bank of the future will look like?
Saigal: Leaner operations for sure, a cut down, slimmer version where brick and mortar physical branches becomes hubs for customer dealings but the majority of transactions are digitised, payments mechanism driven through online and mobile banking applications and a more interactive view of the customers and who they are from the bank’s perspective as bank’s understand their customer better to be able to engage them in the right manner. We would also see the talent pool changing with the digitised age, the retail bankers’ talent pool adopting a more diverse multi-distribution models and personalised customer engagement models will be driving the franchise in the future.
de Villeneuve: Banks have historically been excellent at maintaining a close relationship with their clients through the various stages of their lives and across their various financial needs. Critical to the strength of that bond were frequent visits to the branch but these have sharply declined. The challenge is for us to reinvent this relationship in the digital age, through powerful tools, interesting content about what our clients care for, on-demand support when they need it, and, when it matters the most, that unparalleled financial expertise that our advisors have and our clients still need. If we manage this well we will remain relevant to support our customers with comprehensive solutions and throughout the years. So everything will look different but what matters the most, the relationship, will remain.
San Felix: I believe the bank of the future will be the one that could simplify customers’ lives and achieve the goal of ’anything, anytime, anywhere’. For example: offer simple, clear product and service information; whenever it’s convenient for the customer, easily get trusted advice or help by phone, video or in the branch; the customer can apply for a product or service through one channel and seamlessly finish the transaction on another; offer the same product at the same price, regardless of how or where the customer goes; the customer can access all his accounts on any device; the customer can do most of his day‐to‐day banking through digital channels; the customer can make purchases, payments and transfers quickly through their smartphone; the customer’s interactions are efficient, secure and fast with minimal paper; the customers can easily share feedback, including on social media platforms, and the bank will resolve the issue quickly. At Santander, we call it the ’Simple, Personal & Fair’ way to do banking.
Check out the programme of the 43rd Efma Congress