“Do you have a digital strategy?”
I often ask my customers this question and they all say yes! Based on today’s standard, the reality is that the definition of what a digital strategy encompasses, is unclear, and the definition depends on the type of institution we are talking with.
In this day and age, the number one device used to access the internet is the mobile phone, and a digital strategy should be more than just launching an app. It is true that in some sectors, you can get away with just an app, but in reality, the success of these apps is related to the problem that they solve and to the way this is communicated to the customer.
When we talk about payments, there are a few more challenges to consider, since the action of paying is not, and never was, a problem, as long as you have cash or a plastic card. So, it is more important to have a digital strategy for the organization, not only to bring value to the customer but also to align all the processes inside the organization to support this strategy, in a digital manner.
So, what is a digital strategy?
I can start with what is not a digital strategy. The pure digitization of the card (in an Issuer app or OEMPay), issuing the card instantly in the app, offering instant credit in the app or enabling the card into wearables. Alone, these features will not generate the ROI. It is important to leverage these investments and adapt the organization to support the strategy, in a digital way.
Digital strategy really comes alive when the organization, in addition to becoming customer-centric, adapts all internal processes, including channel and sales strategy to support this new touch-point with the customer. This means that it is necessary to understand customers’ patterns of behavior and adapt the communication and sales channels accordingly. The goal is ultimately to create value for the customer, whilst promoting the adoption of mobile payments. The app has to be perceived as a new communication channel, and not as a tool for payments/access to the bank. It is important to leverage this touch point, and allow not only to cross-sell relevant services to the customer in the context of where the app is being used, but also to provide them with the flexibility that they do not currently have by using the traditional methods of interacting with their financial institutions.
In this way, a digital strategy becomes more a matter of processes and communication than technology. Communication is key to the success of the strategy, since this new channel, besides enabling payments, has to be seen as a marketing one-to-one tool, so should not be handled by traditional business areas such as IT, Cards or Payments, but instead by Innovation / Marketing departments since the challenge is to generate a call to action in the app, and make it relevant for the user, while paying and using the bank services.
This is the stepping stone, and a good start, for a digital strategy which will enable the realization of an ROI within this digital era.
At MeaWallet, we have built a platform that enables banks to deploy digital services, including mobile payments, into the bank’s digital strategy. We would be pleased to discuss and share our experience, insight, and passion for the subject, and on these topics with you.