Winning the Mobile Banking War Means Winning the Digital Transformation Race

Three Five Two
Three Five Two
December 9, 2022

Regional banks can no longer hide behind regional safety nets that kept the giants at bay. Sure, neighborhood customers still prefer convenient branches where they can pop in and deposit a check or talk to a loan officer in person. But their expectations around digital and mobile banking are shifting fast. 

The biggest banks aren’t safe either. An army of non-bank and bigtech companies are innovating how to service customers' financial needs from every angle, stealing customers to never give them back.

So here we are. An exceptional mobile banking experience isn’t a luxury anymore; it’s a requirement. Any bank that doesn’t meet that expectation for their customers will lose them to one that does.

The companies that win will be the ones that realize technology doesn’t support the business; It is the business.

The challenge is a timeless classic-  corporations protecting their core business know they need to innovate, but can’t move quickly enough. In today’s competitive landscape though, the pressure is rising; and necessity is the mother of invention. Companies that really believed they were innovative are seeing new entrants whiz past them with gorgeous products that capture an entire market in what feels like overnight. “Oh, hi Venmo.”

Navigating the transformation from a legacy organization driven by “the way things are done” to a customer-centric, technology-first company requires alignment, commitment to change management, and a willingness to rethink your entire value proposition.

In the book Empowered, authors Marty Cagan and Chris Jones perfectly capture the nightmare situation happening across industries. They describe conversations with Fortune 500 CEOs who insist their company isn’t a technology company, and identify as the leader in their category. When this happens, the authors help paint a picture of what’s actually happening. “Let me tell you what I would do if I was a product leader at Amazon or Apple, and we’ve decided to go after your market because we believe it is large and underserved and the technology is available that enables dramatically better solutions for your customers’… I also point out that, competitively, we would be betting on them not being able to respond because they would be too busy trying to protect their old business.”

For product and marketing teams aiming to catch up or get an even larger lead in the digital transformation race, here are some things to consider:

Build an ecosystem

It’s understandable that in the first phase of mobile banking, technology teams were tasked with creating features that relate to disparate customer needs. Linking to a web view within a mobile app experience was acceptable, and led to customers’ first taste of the conveniences of mobile banking. Those same experiences are now what your customers run from without hesitation. If you’re not creating a seamless ecosystem for your service offerings, you’ll be left behind.

Consider the value Google Business Suite offers its users. A single account can move between documents, share information, and link between products effortlessly. This is the experience banking customers expect.

For small and large banks alike, that type of shift goes far beyond simply adjusting the product roadmap. It takes a disciplined, customer insights-led, and iterative approach. The risk of building a complete, high-tech platform without validating along the way is worse than doing nothing. Just ask UMB Bank mobile app users who scored the experience a 1.4 out of 5 stars after the bank's big reveal-style launch.

So how do you avoid that scenario?

Build for a persona (for real)

I know, personas are nothing new. If you’re a product or marketing leader reading this article, your team likely has some degree of a persona guiding product decisions. But in reality, with some honest reflection, product teams will likely agree they’re still trying to be everything to everyone. After all, your customers have many unique needs; not to mention all the business objectives the app needs to accomplish. Being focused just isn’t that easy.

However, the only way to actually create a superior platform your customers “enjoy” using is to focus on creating one that works amazingly for someone

Keep in mind that what makes them happy today could be old news by next year and use that to fuel your teams to continuously improve. Refine your persona and the problems they face regularly, and stay focused on inventing solutions that make their lives easier. Check-in with that persona frequently and keep your team honest about the feedback and behavior you observe when they interact with your ideas. Don’t let bias lead to wasted time solving the wrong problems.

Gather and share insights like it’s your job

Neither you, your CEO, nor your customers can tell you the best way to build a product for two reasons (credit Marty Cagan and Chris Jones, Empowered here also. It's a great read.) : 

1. It’s impossible to know if a solution will work before launch.

To reduce the risk of building solutions that fail, prioritize gathering quantitative and qualitative insights and sharing them with all of your stakeholders to make better decisions.

Some of the methods our product and insights teams use to gather insights are: Grounded theory, in-depth interviews, experiments, behavioral observation, and usability testing.

2. Your customers don’t know what’s possible.

That’s the job of your team members who understand the technologies that might enable innovative solutions. Empower your technologists to solve problems based on a combination of the customer insights you’ve shared, the technology insights they harness, and the business objectives they need to reach. This is a recipe for creating solutions neither your CEO nor your customers ever knew were possible.

The only way to truly know what product to build, if people want to use your product, and even better, if it has a competitive advantage- is to build it with your customers and continuously gather both qual and quant feedback. But that’s not all. Many people are quick to shout “gather insights” as if that’s all there is to it. Gathering and using insights in the service of product innovation is much more challenging in practice than it sounds. To do it well, you have to be extremely good at defining success, observing and organizing data without bias, evaluating all the context surrounding the data, extracting insights from the data, and using the insights to make decisions about the right problems.

Three Five Two
Three Five Two

Three Five Two is an innovation and growth firm that helps companies build new products, find new customers and pioneer new ventures.

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