Dear reader,
what are your thoughts on the future of banking?
Do you think that face to face bank encounters and branches will totally disappear?
In which direction will the business evolve?
What might be the future trends in your opinion?
Share your thoughts with us! The team is excited to get some new insights and inspiration from your viewpoints :-)
Matthäus for Team Royal Mess
Showing posts with label Trend. Show all posts
Showing posts with label Trend. Show all posts
Sunday, 14 April 2013
Future Trends
Branches
Dissenting
with many forecasts, there will still be branches, because people want to see
who copes with their money, it is a matter of trust. But the branches will
change.
New fresh
bank counter design will provide an open and trustful image of future banks.
Generally the branches will look more inviting and more open to the customers.
There will most probably be fewer branches and smaller ones with less staff.
New technology will be provided inside. It might be possible 24/7 to get face
to face assistance via monitor and teleconference. Many services can be done by
the customer himself within the branch on special counters.
Further
also smaller developments have to be stressed, like new design for ATMs which
increases privacy.
Do-it-yourself
It is
estimated, that the customer can do 90% of banking services on his own. So why
not encourage the customer to do so and through this make banking faster as
well as save costs?
Future
branches might therefore rather resemble check-in counters at airports, where
the customers can do their banking business on their own. There will only be a
few people assisting these actions in case of questions or insecurities.
The most
opportunities for do-it-yourself banking most probably offers online banking. It
is accessible every day and during all times of the day. Further you can reach
it from your home via computer or mobile phone app. These online services will
be further redesigned to make it even easier in the future to do your business
from the place you are at the moment. Along with online and do-it-yourself
services comes mobile banking and customization.
Mobile
banking
Mobile
banking via the internet is definitely still a trend and a growing market. It
allows the customer to transfer money from every place he is. It paves the way
to 24/7 omniscient service, which also means 24/7 possibility to make business
and spend money, possibly increasing spending.
Furthermore
mobilization also concerns the field of assistance. The customer will connect
his device to the bank and get assistance via teleconference or video
conference directly on his mobile device or PC. This advantage makes assistance
faster, accessible from everywhere and every time. No longer the customer has
to go to the branch and queue or make an appointment if a problem appears, he
gets help instantly.
Customization
A trend for
the future is surely also customization. User interface will be tailored to the
customer´s needs in order to make access faster, easier and more efficient.
This might also reach new customer strata who are not using online services by
today. The advantages of the digital age, offering much data to analyze your
customer gives the company many opportunities to customize services, offers and
profiles.
There will
be new ways to perform research on customization. Demographics will no longer
play such an important role, the trend will shift to psychographics. Nowadays
many offers are tailored to life-stage banking but more efficient might be
lifestyle banking guided by the customers´ attitude, values and beliefs.
Cooperation turns to co-creation
Cooperation
is still essential in the future. But even more crucial is creating new
services and offers. In an interconnected world this will more often only be
possible in cooperation. Banks, retailers, technologists and telecommunication
providers will cooperate to co-create new trends. A focus should be especially
put on the cooperation between banks and telecommunication providers. Banks
have the knowledge, experience and licenses for the money business while the
telecommunication branch provides leading-edge possibilities to reach customers
as well as an overall network and infrastructure to offer services everywhere.
Cooperation
can also be regarded under the fact that people no longer strive for owning
things as long as they can still use them. Car-sharing schemes or internet
services like Spotify are an indicator for this trend. This might inspire some
new co-creations.
Digitalization
Digitalization
can be as well a blessing as a curse. Firstly it opens up new opportunities to
offer services to customers and make banking mobile and therefore everywhere
accessible. Secondly it provides the opportunity to gather more information in
an easier way, which allows the company to tailor its services and marketing
better to the demands of the specific customer.
However, digitalization
and major shifts triggered by it in the market of financial services also
changes the environment. New competitors in this field might appear, like for
example Google. The company recently started the Google Wallet service and
payment services are one of the three top priorities for Google in the future.
There are already real life examples how digitalization can change whole
markets and the structure in it. Apple is nowadays the world´s largest music
retailer with its iTunes online store, totally disrupting the market with its
initial actors.
Digitalization
also means "Bye Bye" paper, which has the advantage that many tons of
it will be saved, decreasing costs and having a positive effect on the
environment.
Sources
Matthäus
Is NFC technology the payment system of the future?
Touch-less
and cable-less data exchange can be definitely identified as one of today´s
most emerging trends. Ranging from the commonly used wireless data
communication, internet through WiFi and mobile phone networks, over
identification cards to enter buildings or the bus up to cable-less charging of
the new Nokia Lumia phones. And the trend might also be used in the banking
sector by implanting the NFC technology for fast payment of small amounts.
Fields of application
Most
commonly NFC technology is already used in identification cards, for example
giving access to local transportation networks like busses and metros or
allowing persons to enter buildings. Further Stickers with NFC are put on
packages in order to locate them faster in storages or integrated into labels
as anti-theft measures.
A very
interesting application is the usage for fast payment with credit cards already
implemented in some countries, mainly North America, Austria and recently
Germany . This service is called PayWave by Visa or Paypass when provided by
MasterCard.
Further
phone manufacturers are starting to provide phones with already integrated NFC
chips or add special NFC stickers to be put on the back of your phone in order
to use new payment services like Google Wallet.
Advantages
So what are
the advantages of this technology?
Basically
it is a very fast and not complex way to pay small amounts of money. However,
it also increases daily security, as you are not obliged to carry that much
money with you in everyday life as most payments can be done by your NFC
smartphone, making it less attractive for thieves to rob people.
Risks
Every new
technology has also some risks, especially in the electronic sector and when it
comes to money.
Critics
revolve around the safety of data on the card. Experts argue that the cards can
be read out through the pocket within a range of 10 centimeters, making it easy
for thieves to get credit card data, particularly in crowds or public
transportation. Additionally the authorization processes on the terminals might
increase the traceability of the persons, further leading to a glass customer.
If someone
loses his card, fraud is made even easier, as for these small payments with the
NFC technology no signature or pin code is checked. The thief is able to buy
things until the card or phone is blocked. Although only small amounts can be
paid in this way, still a striking financial damage may be done to the customer
Eventually
some companies doubt, that NFC technology is the payment scheme of future. It
is still bound to check-out terminals, which might create queues. Service providers
like PayPal strive for more mobile payment systems, making it for example
possible to pay things from every point inside the shop just by scanning the
barcode with your smartphone.
Crucial
questions will be: how long will this technology for mobile payment take to be
implemented? Does this make NFC technology only a bridge technology, not worth
to make large investments into it?
Outlook
The NFC
technology will definitely enter the market. It might be successful in a world continuously
yearning for faster utilities. Whether it will finally make a fortune can be
observed in the following years. The break even point might be reached already.
Sources
- webpages
of companies involved in this business
Matthäus
Thursday, 28 March 2013
To be a trend or not to be???
To reline the book report on trend forecasting it is crucial to
illustrate what a trend actually is. Because fully understanding this issue is
essential to rightly adapt the methods promoted by The Forecaster´s Handbook, I will use a whole post to do so.
So what is
a trend?
Actually it has not to be physical or aesthetical. The change can also
happen in the minds of human beings or simply through emotions. The people´s
new ecological awareness of the recent years can for example be counted as a
trend, too. A trend is an anomaly which is slightly becoming more common, more
accepted among the people. Oppositely to a style, which only shows the
difference to the status quo, the trend additionally illustrates the direction
into the examined phenomenon might be moving. The word might in this sentence is crucial, because no one can forecast the
future for sure. This compels every company and every strategist to develop
different scenarios.
Scenario
planning is stressed because it is essential to be prepared to react quickly to
any changes happening in this fast changing times in a multi-connected
globalized world. According to these scenarios there can be crafted action
plans giving advice what to do and how to cope with the development if one of
these scenarios suddenly occurs. The company with the most thorough, best
refined and best reflected scenario plans will come out of this new development
as the new strongest actor in the operating field. Like Shell did after the oil
crisis in the 1970´s, as it was the only company prepared even for the
unthinkable scenario of an oil boycott of the OPEC states.
Resuming
the already posted point, that trend forecast is a multi-field science, Biologist
Richard Dawkins compares trends to genes calling them memes. Genes assimilate themselves and change by going through
bodies, memes assimilate themselves
and change by going through brains. Genes as well as memes assimilate, learn and evolve to ensure survival, whether
socially, intellectually, culturally or physically. They do so very time when people
copy attributions of others which are successful and highly valued by the
surrounding society.
Trends
spread in a different speed due to different factors like the price of the
product, whether it is actually an attitude in people´s minds or something physical
and so on. But regarding the society, how do trends spread or as trend
forecasters prefer to say: go viral?
Sociologist
Everett M. Rogers developed the Diffusion
of Innovation 40 years ago and it is still used in this field of science.
The society is split up into five groups, namely the Innovators, who do not necessarily create the trend but are the
first ones to discover it. Early Adopters,
usually close friends of the Innovators
and socially better connected, adapt the newly found trend as the first
persons. These two heterophilous groups, encompassing people with the aim to be
different, are very interesting for trend forecasters, because usually they are
needed to gain the critical mass a trend needs to start spreading.
The Early Majority starts using the trend
when it already spread but still is not known to everyone, while the Late Majority, a more skeptical part of
the population, starts settling on the trend when it is really proved in the
exercise through other groups. A trend adapted by the last and least changing
stratum of society, the Laggards, indicates that the trend is already gone and
rather common habit than new pattern, hence a good trend forecaster should have
already scented the next trend.
Based on The Trend Forecaster´s Handbook
by Martin Raymond
Matthäus
The Trend Forecaster´s Handbook
Trend
forecast is important as Team Royal Mess has to deal with future banking in our
group´s project with Aktia. This makes it necessary to gather for insights into
techniques which help to perceive new trends. The Trend Forecaster´s Handbook by Martin Raymond should deliver
these insights. Investment into new trends is risky and therefore has to be
well reflected. Companies lost billions of Dollars in the fight for
superstition in the market, for example between the VHS and Betamax in the 90´s
or just a few years ago when the question appeared whether to endorse the
Blu-Ray Disc or HD DVD.
This piece
of literature sophistically provides much knowledge, many examples, case
studies, stories from successful trend forecasters and how they work as well as
a guideline for all phases of trend forecasting from detection to the actual
product development.
Information
is power - Multi-field research has to be done in trend forecasting ranging
from neuro-psychology and complexity theory over behavioral economics up to
network science as well as ethnography. You have to know your sector, your
products, your company and brand as well as the target group very thoroughly.
Methods of trend detection
Martin
Raymond provides many advices how to behave during the working process and what
essential points should be regarded and covered. These methods will definitely
be used by the project group in order to answer the crucial questions of a
trend forecaster: "what", "why", "how",
"where" and "when" does something happen.
This book
thoughtfully lays down the different forms of intuition, well reflected by
providing the advantages as well as the disadvantages. The author clearly
states, that intuitive trend perception may be right and useful, but it is hard
to be illustrated to a customer, who aims for a data-driven explanation about
the whole working process. In order to solve this challenge this piece of
literature promotes different cutting-edge methods to map your thoughts and to
refine them, namely gut intuition, expert intuition and strategic intuition. Furthermore
there is a red string through the whole book guiding you from the first
perception up to the last step, the actual product development.
Cultural Brailing, kind of hyper-observation, is one of the
methods to detect trends. It consists basically out of observation and asking
the right questions about the perceived objects or habits. Since this should
happen without prejudgment, suspension of logic is sometimes crucial. The human
brain automatically associates new sights to known stuff, but this lets you
create only the same stuff over and over again, but nothing new. Logic hinders
creativity!
Many new
thoughts are not logic but make sense later. The motto Think of the Unthinkable has led to many ideas which revolutionized
the world. Open your mind!
Many brains
have more power than one does. In order to work together to find a trend they
have to be connected which happens via a network. The author examines the
different types of networks, from the hierarchical over the collaborative to
the distributive network, and shows the pros and cons of using them. Networks
are everywhere today, yes you are already using a distributive network by
reading this blog post!
App-lication
Now cutting
down trend forecasting to the banking sector and Aktia, what are the crucial
points in the future of banking? An issue to discuss will be definitely the
developing story of the NFC technology. Further there has to be analyzed in
which extend online banking will grow and additionally what role face-to-face
service at the counter will play in the future. Finally and most importantly:
what are the trends no one anticipates today?
Questions
over questions which have to be thoroughly researched to draw scenarios and
make conclusions out of them in order to respond quickly and effectively to
future trends.
Fin.
Matthäus
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