Rethinking banking for an Always in Beta world - Money2020 presentation

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Rethinkingbankingforan“AlwaysinBeta”worldINSIGHTS&IMPLICATIONS|April,2016

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AlwaysinBeta:Anopeninnovationinitiative

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Apowerfulcollaboration

+

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Aglobalstudythatbringstogethersixdifferentlocalcontexts

ISTANBUL

LONDON

CAPETOWN

DUBLIN

MEXICOCITY

SINGAPORE

3usercentred stories:•Transitiontofinancialindependence•Entrepreneurs•Pioneerusers71 userinterviews28expertinterviews13immersionactivities

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Digitalisfinallyshakingupbanking

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Digitalhasfinallyshakenupbanking

35%offull-servicebankingrevenuesatrisk

$16bnspentbyUSbanksondigitaltransformationin2015

3X growthinFinTech venturesinvestmentinthelastyear

1/3millennials believetheywon’tneedabankatallwithin5years

Accenture,DigitalDisruptioninBanking;IDCFinancialInsights;Accenture,FutureofFinTech andBankingViacom,TheMillennialDisruptionIndex

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TheDigitalR

evolution

• Cost• Distance• Time• Barrierstoentry

• Competition• Information• Access• Transparency• Debundling

Digitaldecimatedthebarrierstoentryandincreasedcompetition

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Competitorsareeverywhere

Thefinancialservicesindustryisbeingoverhauled

Everypartofthemodelisbeingdisrupted

WEALTH&ASSETMANAGEMENT

CAPITALMARKETS&INVESTMENT

INSURANCE&RISKMANAGEMENT

PAYMENTS

RETAILBANKING&CONSUMERFINANCE

BUSINESS&CORPORATEBANKING

Newecosystems areforming

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Changedexpectations

Digitaldidn’tjustputusersonline;itfundamentallychangedtheirbehaviors,expectationsandvalues

Changedbehaviours Changed values

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TheDigitalRevolutionhasshapedanewgenerationthatisdisinterestedinbanks

Thereisagrowinggapbetweenyouandyourfuturecustomer

Thetraditionalbankingmodelisdisrupted.Competitorsareeverywhere.

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AlwaysinBetaansweredfourfundamentalquestionstobuildanewmodel

Whatdoesthechangingfinancialserviceslandscapelooklike?

Howcanyoucreatenewvaluepropositionsfor

DigitalNatives?

HowcanyoubuildarelationshipwithDigitalNatives?

WhoareDigitalNativesandhowcanyoumeettheirneeds?

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DebundlingLayeringFragmentation

Bankingecosystemtransformation

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Summary:thebankingecosystemhastakenanewshapeDEBUNDLING,LAYERINGANDFRAGMENTATION

Coretechnology

Platforms

Applications

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Bankshavetraditionallyprovidedtheentirerangeoffinancialservicesfunctionsin-house,andbundledtogether

DEBUNDLING,LAYERINGANDFRAGMENTATION

Lending

Insurance

FinancialLearning

Payments

MoneyManagement

Credit

Saving

Trading

Investing

Coretechnology

Applications

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LowerbarrierstoentryledapplicationstodebundleDEBUNDLING,LAYERINGANDFRAGMENTATION

Coretechnology

Applications

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TheemergenceofplatformsenablesthenextgenerationofapplicationsDEBUNDLING,LAYERINGANDFRAGMENTATION

Platforms

Coretechnology

Applications

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NewplayerswithsingularvaluepropositionsfragmenttheecosystemfurtherDEBUNDLING,LAYERINGANDFRAGMENTATION

Platforms

Coretechnology

Applications

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Thecore-technologyisalsofragmentingasspecializedplayersprovidespecificcoreenablingtechnologies

DEBUNDLING,LAYERINGANDFRAGMENTATION

Platforms

Coretechnology

Applications

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Insummary,bankingistransformingintolayersofcoretechnology,enablingplatforms,andapplications

DEBUNDLING,LAYERINGANDFRAGMENTATION

Platforms

Coretechnology

Applications

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TheemergingFinTech landscapetoolDEBUNDLING,LAYERINGANDFRAGMENTATION

Platforms

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TheemergingFinTech landscapetoolDEBUNDLING,LAYERINGANDFRAGMENTATION

Applications

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TheemergingFinTech landscapetoolmapsout60+valuepropositionsacross9functionalareasandenablingplatforms

DEBUNDLING,LAYERINGANDFRAGMENTATION

Investing

Trading

Saving

Credit

Lending

Insurance

MoneyManagement

FinancialLearning

Payments

Enablingplatforms

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Whoisthisnextgenerationofcustomers?

Aglobalgenerationwhosemindsetandbehavioursarebeingshapedbynetworkeddigitaltechnologiesonanongoingbasis.

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A

C

B

Oldmodel|Linearlifepath

?

??

?

??

?

Newmodel|Mylifeisinconstantflux.SoIchoosetokeepmyoptionsopen.

Yourcustomers’life-styleisshifting

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Howcanyoubuildarelationshipwiththedigitalconsumer?

TRUST

ENGAGEMENT

PLANNING

FINANCIALMANAGEMENT

COMMUNICATION

1. Howcanwebuildtrust withthem?

2. Howcanweengage them?

3. Howcanwehelpthemplan?

4. Howcanwehelpmanage theirmoney?

5. Howcanwecommunicate inawaytheyunderstand?

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Belief inthe authority andstabilityofinstitutions asthe primary driver

oftrust(top-down,one-way)

Trustiscreatedandmaintainedthroughsharedexperienceand

interest(bi-directional)

Authoritative Shared

1.Howcanwebuildtrustwiththem?

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Engagementhasbeenbasedonloyalty– one-timeconversionthat

getspeopleonboardforlife

Engagement is gained throughcontinuous relevance indaily life

Loyalty Relevance

2.Howcanweengage them?

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Long-term planning on alinearlifepath gives people security and

stability

Customers develop their skills andnetworks sothey areprepared tonavigate through their fragmented

life path

Planning Preparation

3.Howcanwehelpthemplan?

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Customers delegate management tothe bank,which is best positionedto take care ofeverything soyou

don’t have to

Enablecustomerstomakeandimplementdecisions

themselves

Delegation Enablement

4.Howcanwehelpmanagetheirmoney?

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Intheageofinformation,providemanyoptions.

CommunicationneedstohavemeaningforDigitalNatives– in

theirlanguage,fromtheirmindset

Information Meaning

5.Howcanwecommunicate inawaytheyunderstand?

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Thisrelationshipconsistsoffivefundamentalelements

SharedAuthoritativeTRUST

RelevanceLoyaltyENGAGEMENT

PreparationPlanningPLANNING

EnablementDelegationFINANCIALMANAGEMENT

MeaningInformationCOMMUNICATION

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AlwaysinBetaToolkit- engageandcreateoffersforDigitalNatives

2.DESIGNPRINCIPLES

3.REFRAMESCENARIOTOOL

1.EMERGINGFINTECHLANDSCAPE

4.FINANCIALMODESMODEL

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AldodeJong|[email protected]+34647857922

Thankyou.Downloadthefullreportatalwaysinbeta.org