As the world adapts to living and working through a global pandemic, some fundamental behavioural and structural shifts have begun to emerge.
Many of these changes accelerated at an astonishing rate – and those new habits are sticking. In just one example, the rapid adoption of digital payments has been described as a ‘permanent change made in 10 weeks’ – one that would otherwise have taken another five years.1
So what does this mean for service providers planning for 2021 and beyond? At Australia Post’s recent virtual Bank@Post Summit, we heard from a panel of banking leaders on how their organisations are adapting to change. Five trends emerged from their collective insights, and these are relevant to a broader range of transactions and services.
1. New digital habits are here to stay
Out of sheer necessity during ‘stay home’ restrictions, Australians have transitioned to online banking, shopping, learning, meetings and so much more. Contactless payments have also grown – up around 65% in value between February and April 2020.1
And according to Salesforce’s new global research, digital-first habits will now stay for the long term.2
However, this transition needs to be supported by operational shifts – enabling consistency across multiple channels, and protecting personal data. As Deloitte Access Economics Partner John O’Mahony commented at the Bank@Post summit, “that’s not something that can just be fixed with the click of a mouse.”
Suncorp Executive General Manager Chris Fleming notes the acceleration of digital use is really about choice. “Being able to do simple things on an app from home is a real benefit for our customers (during COVID). But one of the things we learned is that it’s not binary; it's not digital or face-to-face or on the phone. It’s about a choice of connection points.”
2. The changing role of the shopfront
As the choice and flexibility of channels for service delivery continues to expand, efficiency and convenience are likely to become baseline expectations. In turn, this may elevate the value perception of relationships – of tangible human interactions.
According to Les Bailey, Chief Strategy Officer with Regional Australia Bank, “a good relationship with someone is where you can see the other party is open and transparent, they're listening, they're good at understanding and looking for what's in your best interest.” Their bank measures the number of ‘raving fan’ customers it creates through those relationships.
Fleming believes physical customer interactions are an opportunity “to have a conversation, and to identify the things that are important to them. I think the branch will play a really important role in digital education – because for some customers, it's not as simple as just picking it up and using the technology.”
3. The power of data to personalise
According to PwC’s recent analysis of Australia’s financial services sector, customers are longing for personalisation to reflect the localised impact of change in our lives.3 Data insights will be vital to meeting their needs.
Regional Australia Bank approved Australia’s first loan under the open banking regime in July 2020.4 This enabled the population of data directly into the loan application. “That first loan applicant provided us consent, and authorised the secure electronic transfer of 3,500 transactions from their bank to us,” explained Bailey at the summit. “That data was collected in 21 seconds and completed within six minutes. It created a great experience for the customer, who said ‘it was super easy and I loved when it pre-populated my expenses’.”
4. A chance to rebuild trust
The accelerated shift to online services also comes with potential risks which need to be balanced against cost or convenience gains.
This includes the risk of leaving some customers behind; Australians with low levels of income, education, and employment still face significant digital inclusion barriers according to the 2019 Australian Digital Inclusion Index.5 Australia Post research also indicates 78% of customers still feel more confident being able to get important things done in person.6
Customers also have a heightened awareness of cyber security risks.
“We're trying to encourage our service people to reach out to customers in a different way,” explained Di Challenor, Westpac’s General Manager - Global Transaction Services, at the summit. “But the challenge is customers worrying whether it’s really the bank calling them.”
Getting this balance right will play a major role in maintaining customer confidence.
5. Customer-first collaboration
As competition intensifies, businesses continue to look for new ways to differentiate. According to Bailey, “margin pressure just accelerates the race to the bottom. You have a choice; you can either try to compete on price, or you can look for ways to differentiate on service.”
According to Salesforce, the experience you provide is as important as the product or service.2 Working collaboratively with partners, regulators and government, you can solve new customer challenges and deliver that experience.
For example, Australia Post supported the customers of around 400 bank branches when they temporarily closed during COVID restrictions, as well as 500 branches with reduced trading hours, by providing Bank@Post services at the local Post Office. It also helped 256,000 businesses trade online for the first time through its delivery services.
Throughout the crisis, the local Post Office became an important place for people to stay connected. And it is increasingly serving as a convenient physical touchpoint – providing trusted services that seamlessly integrate with digital channels, such as identity verification or QR codes on bills.
So as you adapt to your customers’ changing needs, consider opportunities to provide consistency across channels and touchpoints, build trust, and provide the personalised experiences customers now expect.