In the financial services industry we have to get two key things right - we have to put our customers first and we have to look after their money. It sounds simple, but as our recent blogs have discussed - our environment is changing fast and, if we want to ensure we keep our customers’ wellbeing and their money at the heart of what we do, it’s sometimes a good idea to take a peek around the corner and see where things are going so that we can be ready.
Interestingly, where we are going has its roots in a concept that’s not new. It goes back, in fact, to American marketeer Philip Kotler, known to many in the industry as the “father of marketing”. He pushed for marketing to become a discipline back in the 1960s, developed the concept of the marketing mix and coined the phrase “the customer is king”.
He was right on the money - companies who treat their customers as kings tend to flourish considerably more than those who don’t.
In our industry, in the coming years, “putting the customer first”, or treating them like royalty, is going to be increasingly important if an adviser or financial services firm wants to differentiate itself from the competition.
But let’s unwrap that concept for the post-Covid world. What is it going to mean in the 2020s for the customer to be king?
To be king, a person needs power and control, to be in charge of their own destiny.
At the moment, as customers, most of us give our data away for free. We relinquish control of it everyday to companies like google, Facebook, the BBC, Whatsapp and Amazon. And they use it and sell it.
But that could all change if each of us, as customers, could retain more power and control, if we could have our own data store, a portable store of all our digital assets, which we completely controlled and even monetised. Our personal data would be structured, a clean data set including our financial assets, our banks accounts, credit score, energy usage, pensions, insurances and wills and even the more personal “lifestyle” elements of our day to day lives such as how and where we shop and what we spend on our family’s holidays and interests.
Individuals could then permission this data in whatever way they wanted. For instance, we could provide utility companies with access to our energy usage, get them to pitch us their best price or allow them to advertise to us - but for a fee. Or we could make a deal with Facebook or google - offering them temporary access to a clean data set (in contrast the unstructured data they currently have for their users) - and the opportunity to advertise to us for perhaps 20p an ad. Or we could partner with Sky Sports, provide them with limited access to our sports and lifestyle choices in exchange for a free or reduced cost subscription.
And customers could also use their data to get themselves the best services and advice. For instance they could pitch out their data related to their assets to five investment companies for a single day and see who came back with the best plan to boost their wealth.
The technology is already there for much of this and a number of organisations such as Pensions Dashboard, TISA (The Investing and Savings Alliance), Origo, OIX (a not-for-profit organisation promoting the idea of a federated ID) and players across the open banking and open finance space - are all pursuing their own version of the concept.
It’s the future for the customer. It’s maybe going to be how financial services customers behave not too many years from now. But whilst it’s not happening quite yet, financial services companies using Visible Capital’s technology remain a step ahead of their competitors by providing their customers with a sense of what it is like to be “king”, exert control of their own data and use it to get a better service.
Using a system of data connections to open banking, pensions data, savings and investments data and healthcare policies, Visible Capital’s technology allows customers to provide their financial adviser, at the press of a button, with an unprecedented amount of rich data. This in turn allows their financial adviser to present them with highly informed and personalised wealth management advice.
I worked for Kwik-Fit at one time where 100% customer satisfaction was not considered good enough and was upgraded to a mission to achieve 100% customer delight. But perhaps customers down the line will expect even more than delight. They will expect 100% customer control.
They will, in fact, expect to rule over the kingdom of their own finances.
by Ross Laurie CEO, Visible Capital
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