“Digital transformation” is no longer whispered in boardrooms across the financial services sector – it’s in full flow. The critical objective of transformation is to make customers happy through best-in-class services and innovation at every touchpoint. As a consequence of expectations set by the likes of Amazon and PayPal, customers demand a seamless experience when engaging with their bank. 

Against this background, banks increasingly find themselves competing in customers’ minds not only with financial services competitors, but with players across the digital spectrum. New banking entrants such as Starling, Atom, and Monzo are becoming established, while giants such as Google and Amazon continue to expand into a broad spectrum of services. 

So, what do we mean by ‘touchpoints’? At Davies we look at touchpoints as any communication that crosses the boundary between a bank and its customers, such as branch visits,  website, chatbots, email, SMS, voice assistants, call centres, or internet/mobile banking apps. 

We always keep an eye on trends and activities in the touchpoint space and here’s what we found: 

It’s no longer one size fits all 

• There are many methods by which a customer can contact your brand, but it is key to understand that not all touchpoints are created equal. Bain suggests that “Banks can earn greater loyalty by reducing the volumes of unnecessary transactions, making routine interactions easy and convenient, and improving the service experience of high-stakes [..interactions].” 
• Meanwhile, Deloitte believes that “Enabled by digital technologies and extensive information sources, consumers can choose how engaged they want to be across the different touchpoints of their path to purchase.”  
• This was echoed by Square’ CFO Sarah Friar at this year’s MoneyConf – “Customers are going to show up everywhere [..] across multiple touchpoints and we need to respond.” 

Partner up with Fintech 

• “There is an increasing expectation gap as businesses struggle to keep pace with more informed, more connected and more demanding consumers” [Deloitte]. In a bid to bridge this gap and gain notoriety in customers’ minds PWC suggest “Financial Institutions are embracing the disruptive nature of FinTech […] and learning to partner”  some examples include Axis Bank & Thought Factory, Santander & InnoVentures, and Barclays & Techstars. 
• In the same space we observe a drive to bring innovation in-house; ex-HSBC CEO Stuart Gulliver had this to say – “All of the bank CEOs are enthusiastic purchasers of fintech capability, because the fintech industry almost represents a supermarket to purchase from.”

Blockchain becomes part of the strategy 

• Simultaneously, blockchain technology to streamline KYC processes is becoming a key focus of Financial Services providers. Outside of the dramatically improved customer experience – According to a Goldman Sachs Report “the introduction of blockchain in the KYC procedures could drive $2.5bn in operational cost savings.” 
• There are exciting applications of blockchain – some use cases around touchpoints are emerging: improved payments infrastructure, securities trading, amongst others. When talking about Fintech 2.0, Santander InnoVentures stated “Blockchain technologies could reduce banks’ infrastructural costs by $15-20bn a year by 2022”. [6] 

Embracing new technology, some observations: 

• To match customer expectation, Financial Services providers will need to compete with the capabilities of high-functioning digital tools in other areas of customers lives. Partnering with Google & Twilio Marks & Spencer is utilising artificial intelligence to quickly deal with customer complaints; while reallocating call centre staff to in-store roles. 
• When looking at banking of the future Accenture found “45% of digital-savvy consumers would like their bank to introduce new ways of communicating like wearables or virtual reality.”  Financial Services providers are reacting; in 2017, BNP Paribas launched a “VR-based app […] including consulting bank transaction records and following through the various steps of a real estate purchase.” 
• Lemonade, a US insurance company powered by Artificial Intelligence is using behavioural economics to drive better, more honest customer interactions. – “Provide a shockingly great claims experience through empathy, transparency, availability, and speed.” 
• New technology is enabling classic sales and marketing techniques to form part of a digital journey. – “Access to customer context is key to a great customer experience in voice and messaging flows. As it lets you customize your interactions specific to that customer and address their needs promptly.” 
• Artificial Intelligence plays a key role when it comes to touchpoints. RBS has partnered with IBM to build an AI chatbot named Cora. RBS CEO Ross McEwan stated in the 2017 annual investors report – “Cora is helping our customers with many of their most common queries. Crucially Cora is available 24/7, has no ‘wait-time’ to serve a customer and can handle an unlimited number of queries at the same time.” The same report states that Cora handled close to 0.5M customer interactions in 2017. 

So, there is a lot going on, and the whispers around “digital transformation” have now evolved into active and open discussions about how customers engage with businesses and services.  Just having a broad set of customer touchpoints is only the beginning. More importantly it’s how you manage those engagements, evolve them, monitor them and make them work both independently and seamlessly with one another that will ultimately keep customers happy.