Delivering an exceptional customer experience or Why entrepreneurs care about customers. Anthony Thomson

Transcription

1 Delivering an exceptional customer experience or Why entrepreneurs care about customers Anthony Thomson

2 Some thoughts on How customers see banks What matters to customers Creating a customer centric bank How customers are changing the way they bank The bank of the future

3 WHAT THE BRITISH SAY With the greatest respect That s not bad That is a very brave proposal Very interesting WHAT FOREIGNERS UNDERSTAND He is listening to me That s poor He thinks I have courage They are impressed

4 WHAT THE BRITISH SAY With the greatest respect That s not bad That is a very brave proposal Very interesting WHAT THE BRITISH MEAN You are an idiot That's good You are insane That is clearly nonsense WHAT FOREIGNERS UNDERSTAND He is listening to me That s poor He thinks I have courage They are impressed

5 Banker or entrepreneur? Founder and former chairman Metro Bank Founder and chairman atom bank Chairman, the Financial Services Forum Chairman, National Skills Academy for Financial Services

6 Metro Bank Opened July locations >1000 colleagues 350,000 accounts 3 billion balance sheet 93% of customers satisfied or very satisfied 8/10 would recommend to a friend

7 Atom Bank Opening 2015 No physical locations 170 colleagues Delivered through app Designed for mobile Telephony as a helpline not a channel Cost/income ration 28%

8 Atom s mission To change banking for good. That is permanently, for the better, for our customers. 8

9 Atom s vision To be the first telepathic bank First, using data analytics and predictive technologies we want to be so close to our customers that the service we provide anticipates their needs and wants. Second, as technology develops, it is simply a matter of time until people are able to control their computers and their digital wealth with their own thoughts. 9

10 Atom s strategy New and different Atom is a new and completely different bank. Innovative in every part of the value chain, our low cost and customer-centric model provides outstanding service and value for our personal and business customers. Designed for mobile Atom is the UK s first mobile bank. It has been designed for digital, app based and optimised for smartphone and tablet. The Atom contact centre support team provides customer support and an emergency transactional banking capability. Well managed It is delivered by an experienced, committed management team, who strive to maintain our innovative advantage through formal and informal innovation scanning processes. With strong governance Atom is overseen by a skilled, experienced and diverse board of experienced NEDs. 10

11 Atom s strategy Customer centric & data driven Using technology and data analytics to provide customer insights that enable us to predict customer needs and meet them as they think of them (or possibly before). We call it telepathic banking. Setting new standards for efficiency SaaS, low cost geographical location, reduced cost of analytics and cloud storage, lower labour costs, no branches, no paper, electronic payments, straight through processing and relentless reliability will lead to a marketleading cost: income ratio of less than 30%. Producing better returns for stakeholders Customers experience better value products and services while producing superior returns for shareholders, targeting of 10x return over 5-7 years. 11

12 How customers see banks

13

14 What matters to customers? Anything but banking The Price v service dilemma Service v self service

15 Creating a customer-centric bank 1. Build a differentiated model 2. Create a culture to reinforce the model 3. Execute relentlessly And you will create fans not customers

16 Building a differentiated model Start with what matters to customers Invest in the customer experience first Manage costs second

17 Building a differentiated model Exceptional companies, when faced with tough choices, follow three rules: 1. Better before cheaper. They rarely compete on price.

18 Building a differentiated model Exceptional companies, when faced with tough choices, follow three rules: 1. Better before cheaper. They rarely compete on price. 2. Revenue before cost. They drive profits through price and volume, not thrift. 25,000 companies data Over four decades

19 Building a differentiated model Exceptional companies, when faced with tough choices, follow three rules: 1. Better before cheaper. They rarely compete on price. 2. Revenue before cost. They drive profits through price and volume, not thrift. 3. There are no other rules. Everything else is up for grabs. 25,000 companies data Over four decades

20

21 Create a culture to match your model Sales v service Instil and reinforce Reward the behaviours you want Monitor and measure

22 KULTUR SPISER STRATEGIER TIL MORGENMAD 15

23 Execute every day Retail is detail One thing v many Lead by example

24 Creating a customer-centric bank 1. Build a differentiated model 2. Create a culture to reinforce the model 3. Execute relentlessly And you will create fans not customers

25 Creating fans

26 How customers use banks is changing

27 Retail customers are changing They are moving banks Less than one in three customers are loyal and satisfied 1 8% moved to a new provider within the last year / 19% within the past three 2 Customer switching has doubled in 3 years 4 12% are predicted to move in % would consider moving to a challenger brand 4 and it s becoming easier for them to move Payments Council introduced seven day switching in September K people switched their current accounts in the first ten days 306K switched in Q4 of 2013, a 17% increase on the same period in as they desert branches RBS branch usage has declined 30% since One in four UK bank branches will disappear within five years Sources:; 1 - TNS June 2013; 2 - Mintel 2013; 3 - Sunday Times 28/7/13 4 Simon-Kucher 2013; 5 Payments Council Jan ,7 Telegraph online March 5 th 2014 Less than one in three customers are loyal and satisfied TNS June 2013 Traditional bank branch is dead, insists Virgin Money boss Jayne-Anne Gadhia This is money 5 th March

28 Retail customers are changing they are moving to digital channels in general In the next five years more than two-thirds of banking customers are likely to be self-directed and highly adapted to the online world branch usage down almost one-third; internet transactions up one-third 2 Internet banking usage grew from less than 10% in 2001 to approximately 35% by In 2012 online banking penetration exceeded 50% of all internet users ~70% of customers would consider using a retail bank provider that has no branches and only operates an internet and telephone service 5 65% of consumers use online banking at least weekly, only 14% visit a branch as often 6 Sources: 1 - McKinsey 2013; 2 Simon-Kucher 2012; 3 Simon-Kucher 2012 (use at least once a week); 4 - Comsource JLL 2013; 5 - OFT/SKP (77% current account, 71% savings 68% loan); 6 - Datamonitor

29 Retail customers are changing and mobile in particular In 2012 smartphone usage grew 81%; network connection speeds more than doubled Mobile internet will overtake desktop internet usage by In the year to Sept 2012, PC banking up from 63% to 70%; mobile banking up 12% to 28% 2 26% of UK smartphone app users used banking / financial apps in % of UK tablet owners used them for banking / personal admin 4 Customers evaluate the quality of mobile services in their decision move to / from banks 5 Within three years over 60% of banking transactions will be on mobile devices 6 24% of UK customers would switch service provider if they could interact better using their mobile 'phone 7 The Payments Council is aiming for system linking all bank accounts to mobile numbers by 2014 Mobile internet usage will overtake desktop in 2014 JLL 2014 Sources: : 1 - JLL 2014; 2 - Kinetic Oct 2012; 3 - Neilson 2013;4 - IPSOS July 2013; 5 - Cap Gemini 2013; 6 - EFMA June 2013; 7 - SAP/Loudhouse April

30 A quote from Ross McEwan, CEO, RBS Do you know what our busiest bank branch is in the UK? 30

31 A quote from Ross McEwan, CEO, RBS Do you know what our busiest bank branch is in the UK? It s our mobile app on the 7.15am train to Paddington," 31

32 Digital customers buy more and are more satisfied 32

33 Digital customers buy more and are more satisfied In a survey of 77,000 banking consumers, consumers who conduct the most digital transactions also have the greatest satisfaction with their banks (as measured by Net Promoter Score) and do more business with them as well. Customer loyalty scores were nearly three times higher for digitally-active customers than for less digital counterparts. There was also a correlation between digital channel use and affluence. 33

34 The bank of the future will Be channel agnostic (but digitally led) Focus on giving the customer a better product, service or experience Be better before it is cheaper Focus on revenue before costs 34

35 at_anthonythomson