Lifestyle banking sounds like a cleverly coined marketing phrase, depicted by a billboard splashed with models draped in haute couture, with pouting lips poking out of their intricately painted faces. On the contrary, it involves leveraging data and customer journeys to deepen relationships with the customer. This concept uses technology and consumer data to identify new opportunities to solve timely pain points or create delightful experiences. The key to decoding and delivering lifestyle banking, is a great customer experience strategy. There are some key considerations that must be made when actualising lifestyle banking for customers, and for the sake of an institution’s bottom line.
- Lifestyle and Life Stages
We cannot talk about lifestyle without considering life-stages. Customers in their 20s to 30s will be at a different life stage than those in their 30s to 40s and the same applies to those in their 50s to 60s.
In In their late 20s two 30s customers are finalising on their higher education or just entering the workforce. Some of their priorities might be towards reducing their student loans, making their first ever rental payment, for their first car, further education, or future family. Their lifestyle may tend to be thrifty, trendy and driven by social happenings such as concerts and events.
In their late 30s to 40s customers are building families or building their careers. Their priorities may involve school fees, building a family home and supporting extended family. Their lifestyle tends to be quality and responsibility driven. Whether in consumables, or in time. They think more of the future in terms of investments, school fees, and business capital.
In the late 40s to 50s customers are relatively settled. Their priorities tend to lie more on Paying off debts such as mortgages, medical bills and retirement planning. They are more driven by a financially safe retirement and leaving something behind for their offspring.
Customer journeys for each of the above brackets will look completely different and so should their lifestyle banking experience.
As mentioned, lifestyle banking means meeting customers at their pain points. One of customers pain points in banking is the inconvenience of having to visit a brick-and-mortar facility. This is where technology comes in. Today, most financial institutions have a form of digital aspect embedded in their banking process, but most banks do not have an end-to-end seamless digital experience. Lifestyle banking will require digitally astute execution. Most customers today regardless of their life stage, hate inconvenience. Let us be honest, who would rather spend their precious lunch hour waiting in a bank lobby as opposed to having lunch with their beloved? Having a digital platform is not enough, banks must also deliver what I refer to as the holy grail of digital banking. Reliability, Speed, and Integration.
Customer will hate you when they are sitting at that lovely café unable to pay their bills using their app because your system is down. Customers will resent you when they are forced to retry severally before completing an online transaction, just because your system is slow. Customers will despise you, when they must enter the same data at several touchpoints, because your system is not integrated. Customers will dump you when they cannot link alternative financial products to their bank account, due to lack of a foresight into their lifestyle and thus technology needs.
When it comes to using Data for digital and customer experience transformation, sensitisation is key. A lot of customers are deeply insecure about data. They find it daunting to share information as they do not know who is going to use it for what. Often times they do not dive the real data, and this may lead to mistargeted experience strategies. The mistrust deepens when they must re-enter data at several points of their experience. In this age of Cambridge Analytica scandals and increasing incidents of internet fraud, customers must be assured of their data security. This can be achieved by training on data security both for the bank and customer and enacting a one-time capture policy. Data should be collected more than once only for purposes of verification (this should be far and few between) and updating.
The lifeline of the data puzzle once it is secured, is analysis. Data that goes un-analysed is a complete waste of server space. Investing in expert data analytics is undeniably the best investment an institution can make when trying to deliver real lifestyle banking to customers. Further investment into Artificial Intelligence (AI)-based analytics will help gain valuable data insights about customers and match their needs on a deeper level. It is important to note that e-commerce, e-entertainment, e-learning and several other e-activities are all becoming the lifestyle ecosystem of the modern consumer. Accurate data analysis will thus empower institutions to develop relevant products, as well as createpartnerships and alliances to meet the consumer need.
“Lifestyle banking means being present in people’s lives anywhere, at any time and creating constant bonding with them. It means transformation to something more than just an institution – to a reliable partner, guide, and assistant. ” – Jonathon Bartlett, Senior Business Development Manager, Financial Services at intive. The above three are just the starting point in developing and actualising Lifestyle banking. Unpacking the above factors will reveal sub-factors such as emotions, user experience interfaces and new data driven features. Unlocking the potential of lifestyle banking will increase revenues, increase customer loyalty, and create lasting impact on how customers use financial products to solve real life problems.
Written By: Mariam Agyeman-Buahin
Mariam is a seasoned Marketer, brand consultant and Fin-tech professional. She is currently the Head of Digital Banking and Corporate Partnerships, at Standard Chartered Bank Ghana.