Earlier this month we headed out to Phoenix, AZ for two jam packed days at Future Digital Finance West.
We talked to people from financial institutions all over the US. Heard industry leaders talk about the future of digital transformation.
And after two days a few things became clear:
Every financial institution (regardless of size) is investing heavily in new digital properties.
The vast majority of transformation conversations focus on developing tech — not getting people to use it.
It seems that “build it and they will come” is still a large part of most financial institutions’ strategy.
The only problem is this doesn’t factor in that change itself is NOT convenient.
It feels easier to do things the way you always have — even if you know there’s a more “convenient” option.
Awareness doesn’t equal adoption. And to reach their adoption goals, financial institutions will need to make significant changes to their current strategy.
The Current State of Digital Adoption Initiatives
For the most part, larger financial institutions are running broad awareness campaigns to drive digital adoption. Common examples include national TV campaigns, direct mail pamphlets, and video ads in branches.
The trouble with most of these campaigns is:
They’re not targeted.
They focus on awareness, not encouraging behaviour that leads to adoption.
They don’t use a unified approach across consumer and internal initiatives
1. More Reach Isn’t Always Better
Broad campaigns (like TV ads) end up reaching a lot of different people, many of which are not your customers.
The problem is having digital banking is no longer a competitive advantage. Everyone has digital properties, so educating consumers about them is unlikely to lead to new customer growth.
By reaching consumers outside of their customer base, financial institutions end up wasting significant amounts of their marketing spend talking to the wrong people. Money that could be better spent on targeted messaging for their existing databases.
2. Awareness Isn’t Enough
Most digital adoption campaigns we see focus on awareness; they simply tell customers that digital options exist. But according to reports like the EY FinTech Adoption Index, awareness isn’t actually the problem:
Awareness isn’t enough to promote change. People need a reason to change their habits, and “it’s more convenient” isn’t enough.
Fintech might be convenient; but change isn't.
To drive adoption, campaigns need to go beyond just education. They need to incentivize initial interactions, and encourage consumers to develops habits of use.
3. A Unified Approach to Digital Adoption
Something we heard from multiple financial institutions at FDFWest was this is the first time their marketing and training departments have fallen under the same umbrella. They’re not sure how to work together, and often this results in a duplication of efforts.
But a unified approach to adoption is crucial; customers need the support of both online resources and front-line staff to make the jump to digital.
By bridging the gap between marketing and training you can significantly reduce the costs of fluency programs, using the same content to educate staff and customers.
Moving Forward: The Future of Digital Adoption Initiatives
To drive a meaningful lift in adoption, financial institutions need to:
Bridge the gap between marketing and training. We heard from many people that their marketing and training departments aren’t sure how to work together. But bridging this gap is critical; consumers need the support of both online resources and frontline staff to make the jump to digital.
Move beyond awareness campaigns. Financial institutions need to move beyond the current “build it and they will come” mindset. Awareness isn’t enough to drive adoption. Campaigns need to develop usage habits and deepen customers’ engagement with digital properties.
Use more targeted approaches to drive adoption. Broad national campaigns are only so effective — and often too expensive for smaller institutions. Financial institutions need to use more targeted campaigns to drive adoption.
Financial institutions have the tech. It’s time to get customers to actually use it.