Foresight Factory’s predictive trends forecast a turbulent time for banks – career certainty is declining and personal life steps are less linear – meaning that customers need different products and type of engagement. I recently presented a webinar where I looked at five trends driving the future of banks in the USA.
Lifestages in Flux
Foresight Factory USA data shows that 33% of consumers have changed their career twice or more, which is pretty much the same as the global average. 8% globally have been married twice or more and in the USA, that’s 10%. Lifestages in Flux can explain these less conventional behaviors that extend to changes to the average age that people start families and when they retire. This tells us that consumers are looking at their own lives differently and with that, the type of financial accounts that they need. Therefore, there’s a demand for more financial products at unpredictable times, which undercuts conventional consumer segmentation based on age or social background.
The Networked Family
Particularly after 2008, affordability of property and low employment, as well as longer life expectancy has given way to vertical families. At Foresight Factory, we call our trend The Networked Family and of particular note is the sandwich generation or Baby Boomers who are providing financial support to their parents and children. There are certain innovations that profit from this and allow older generations to help the younger ones afford a place on the property ladder. St. James’s Place, a UK based wealth management firm targets first time home-buyers with inter-generational mortgage schemes. Furthermore, one of the defining features of this multi-generational family described in our trend is how adaptable they can be to accommodate the financial needs of a member. This suggests that we may see a rise in products marketed at families, in order to target millennials.
Conversational Commerce via messaging apps are used in our daily lives and banks can capitalise on this by engaging with people and even selling services via chatbots. 28% of consumers globally already use a chat messenger service to speak to a customer representative. Some innovations for inspiration include Penny, a chat interface that provides advice from a robo-advisor, for a personalized and efficient response. Then there’s Kasisto that introduced MyKai, a conversation-based type of banking, which in my opinion, is one of the strongest methods. Through voice command and without any need to login or visit your bank branch, you can ask your smartphone information about your bank account and even make transfers. Conversational commerce is set to grow across industries but particularly in banking, as this occurs against the backdrop of consumers’ demand for ease when it comes to controlling their information.
This isn’t strictly a trend, but the findings of our Brand Magic research were one of the highlights of our Annual Conference last year. The analysis looked at the drivers of brand affinity and the findings were pretty provocative. For example, customer loyalty programmes can actually detract from brand advocacy. Perhaps even more controversially CSR programmes have neutral impact, unless they’re a holistic part of a brand’s overall DNA. Looking at banks in America, some of the key drivers of long-term advocacy are quality and reputation, but also attributes like being inspiring. Contact us if you’re interested to know more about how we can help map your brand’s unique territory.
Traditional banks and challenger ones alike can benefit from our trend Challenge Accepted that looks at how banks can help consumers improve themselves through gamified elements. For banks, this points to schemes where certain actions that shape a desired spending pattern is rewarded. We found that interest in this among global consumers is strong at 60%. And as we know that 68% want a brand that reflects their personality, financial institutions may benefit from changing their perspective from that of a transactional brand-consumer outlook to one that aims to inspire their customers.
Interested in how to appeal to the Mobile First consumer? Or do you want to know about more of the trends driving new business opportunities? Download our US webinar here.