In my humble experience, the older an industry, the more complex and antiquated the customer experience. If you don’t believe me, compare using your mobile phone with buying a plot of land. Globalisation, at least for customer experience, has done us a massive favour in terms of standardising, simplifying and empowering the individual to “do it for themselves”. Our mobile phones work from out of the box, standard features that can be customised to our personal taste, and little if anything ever going wrong with them. In stark contrast, no matter what country you live in, purchasing a plot of land, even a very small one involves many authorities, numerous laws and regulations and considerable additional cost & time. You might suggest that comparing using your mobile with buying a plot of land is like comparing apples with oranges, but I’m sure you appreciate the point I’m making.
With this in mind, this week’s post is about my experience in dealing with another long established industry – financial services. Wherever you live in the world, dealing with banks and financial businesses is an essential aspect of life. In the UK, most of the banks have lost trust and belief from their customer following the financial scandals from a decade ago. Coupled with a complex industry with reams of regulations, most people don’t feel positive emotions when they think about their bank.
But since the financial crisis, there’s a raft of new upstarts entering the market. Some are building traditional networks to compete with existing banking behemoths. Others are finding new ways to challenge convention with creative products, delivered online and via your mobile: fintechs. I’ve worked with a couple of fintechs, and the dynamic and challenger attitude is a breath of fresh air. It was to one particular fintech that I turned recently when I decided I wanted to set up a new savings account.
Nutmeg is an online investment company that started up 5 years ago. It has already built a loyal following with its innovative product and excellent service. I decided to give them a try. Having previously set up a similar savings product, I was expecting lots of forms, phone calls, documents to sign and a wait of a few weeks before things were up and running. Instead, using the Nutmeg website, I was able to complete all the details, get everything set up, and even have a couple of queries answered by their customer service team within a couple of hours – wow! I am genuinely impressed by such a simple and actually enjoyable experience.
When people tell me that things can’t be improved, simplified or made more customer friendly due to cost, regulation, or even worse “because that’s how we’ve always done it”, I feel real despair. If even the most archaic of industries is now changing for the better, there is NO reason why every industry, product and service can’t move forward, one step at a time. The biggest barrier to change is not rules, regulations and process, it’s apathy towards your customers!
Nutmeg looked at the financial services industry and saw customer injustice (poor service, horrid experience, low levels of trust with incumbents). This opened the door to considerable revenue opportunity. Starting from scratch, they built an online product, then finessed it, enhanced it and created a support structure to guide customers when the online experience falls short. Now, 5 years on, the product is stable, the marketing strategy is clear and they can focus on growth. This is a great success story.
But what about those in long standing businesses who are keen to change and are willing to invest time, money & effort to effect the change? The ideal approach is not so dissimilar – incubate your “new” venture, treat it like a start-up, and avoid saddling it with baggage, old process and rigid thinking. It never ceases to impress me how quickly a team will engage in the new venture, as if awakened from slumber, throwing their effort into making the new approach work. Of course, there will be barriers and challenges, but a well thought through transition plan, together with good, strong communication plan will carry you through most hurdles. So if you are feeling the urge to catch up with the fintechs, start-up and new entrants, take a leaf out of their book and start building!