Differentiation Requires Personalized Digital Banking Experiences

Jim Marous:
Hello, and welcome to Banking Transformed Solutions, a new podcast that provides financial institutions insight into marketplace solutions that can help organizations with their digital transformation journey. I'm your host, Jim Marous, Founder and CEO of the Digital Bank Report and Co-publisher of the Financial Brand.

Jim Marous:
Consumers have grown to expect personalized digital experience across all channels and throughout the entire customer journey. Much more than just good targeting for officers, organizations need to engage contextually in real time, helping consumers reach their financial goals. Achieving personalization at scale is daunting for any organization. This is where the power of strategic partnerships is so important to achieve success.

Jim Marous:
Our guest is Colleen Dabbs, Director of Solution Consulting for Fiserv. We discuss the importance of creating digital solutions and delivering a personalized digital experience across all channels. We also dig into how this can be achieved quickly and what the barriers to success are.

Jim Marous:
Welcome to the show Colleen. You know, it's so important. We've been talking about this on previous podcasts. I talk about webinars. I talk about it in speeches. If we're looking at anything that's happened during the pandemic, probably the most important thing that's happened is the consumer is more aware than ever if they're being talked to as a group or as an individual. And consumers are looking for that connection with their financial institution, with other organizations they work with that says, "I will know you, I will understand you, and I'll reward you."

Jim Marous:
And that doesn't mean points. That meant rewarding in a way that says, "You know what? You're looking out for my well-being." And I many times will use the analogy of a GPS system. A GPS system, if it works well, is not a rear view mirror. It provides you a guide point as to where you're going into the future and how to get there, how to avoid the pitfalls, and how to take advantage of what other people found to work.

Jim Marous:
And there's probably no better analogy than in financial services that most financial institutions today, more than ever, need not to tell people what's already happened, talk about the monthly statement. But they're looking to provide a consumer, the consumer's looking to the financial institution, to engage with them in such a way that says, "You know what? I'm working on your behalf, and I know who you are."

Jim Marous:
Now, these may be segmented and may be customized, but overall that's what we're looking for. So Colleen, let's start off right at the top of the funnel there. How does an FI, how does a bank or a credit union, get started on creating the personalized experiences that we're talking about?

Colleen Dabbs:
Well Jim, the first thing they need to do is they really need to understand the digital solution and the digital strategy of their institution because the digital strategy is going to derive the tools and the experience that they can deliver. So for example, are you a build, buy, or partner organization? That's a very key thing to understand because if you have a vision for collecting a lot of data, turning it up, and then spitting it out in a way that provides that experience, then you have to have a really strong technology focus on your strategy. Or, you need to partner with a vendor who can provide that for you. So understanding whether or not your financial institution is a build, buy, or partner is the first step in determining how to start building those experiences.

Jim Marous:
Well it's interesting. I might go back to my analogy of the GPS system. The challenge also is if you don't know your destination, it doesn't matter how good the technology is in the GPS system. It's going to point you in the wrong direction. So when you're looking at what organizations that you work with are setting up as their vision, setting up as where they want to end up, what do you see in the majority of the financial institutions you work with at being what their vision of what they want to be when they grow up, for lack of a better term, what do you see that as being?

Colleen Dabbs:
Well, I think everybody wants to do the right thing, but there's a lot of different ways to accomplish that. And they want to be the most high touch high tech with their customers, but they also need to realize that if they're partnering with the wrong vendor, if they are driving their wrong vision, then they will struggle.

Colleen Dabbs:
And I like to use the analogy you can't buy a Ferrari and only use it to go to the grocery store, and then be upset that it's too expensive, you don't know how to drive it, because you're not using it to its fullest extent. And so if you buy a very highly technical product but you don't use it the way that it's designed to use, then you're going to be frustrated. Conversely, if you buy an out of the box product and it's not giving you the power that you need, you're going to be frustrated. So being able to tie those two things together and understand your digital strategy, the resources, and the right partner, that is where you're going to find your most success in making that vision come to fruition.

Jim Marous:
So when you work with financial institutions, a lot of organizations say, "We want to become a digital bank." And we've seen this and our research has shown that almost every institution says, "I want to become a digital bank. I want to deliver better customer experiences. I want to apply data to accomplish that. And I want to have the innovative spirit."

Jim Marous:
Now the challenge is, is actually implementing against that. Number one, we find that a lot of organizations thought, especially at the beginning of COVID, that simply giving consumers access to a way to digitally open an account really isn't a strategic and digital vision. It really is simply making what was in one point a branch opening a digital opinion, and that's not a digital experience. How do you see organizations, or how do you help organizations get out of a poor definition of what a digital strategy is?

Colleen Dabbs:
That's a great question, and a lot of it comes down to collaboration and partnership because people will use terms like that, but they won't know how to get there. And so working with a partner who can understand that and give them options and allow them to flex as they need to versus taking everything out of the box is one step along the way.

Colleen Dabbs:
But the other thing is that they really have to understand what the solution is they're buying and are they willing to actually make that jump forward into the digital space or are they still holding onto things that are ancient online banking solutions? And one of the things we see a lot of times when people are changing solutions is they want more, they want that experience, they want that unique factor to come into play, but they don't want to give anything up that they've had before. So they want to keep continuing to carry that old baggage into new technology. And that tends to be where people get stuck because they won't give it up. How many people have cigarette lighters in their cars anymore? Eventually, old things have to go away so that you can make room for new things.

Jim Marous:
That's a great response because I think what we sometimes miss is at the end of the day, and I'm sure you see it all the time, that organizations know what they need to do. They pretty much know how to get there. The challenge is to change their thinking about what they're doing currently. And I see the biggest challenge as being organizations have legacy leadership, legacy cultures, think of things in the old way. And even when you try to implement a digital strategy, you're sometimes at the mercy of bad back office processes that hamper speed, hamper implementation, hamper the success of a program.

Jim Marous:
And I think your point is well taken, and I say it often, is that organizations today can not adequately do it alone. They need to use a strategic partner solution provider that will get on the path with them and keep speed.

Jim Marous:
I mentioned to you before we got on the line here that I see a lot of organizations just overwhelmed with the complexity of daily work. And in fact, it's shown in our research we did where we found that digital maturity, data maturity, personalization, all these skills, while everybody's gotten better at over the last year, they rated themselves lower. And a lot of the reasons why that took place is because expectations got greater.

Jim Marous:
And I think to your point, when you can find a solution provider that works with so many financial institutions as Fiserv does that can take the winning solutions that they provided to other organizations and avoid the pitfalls that you've seen at other organizations, you can get to I'll call it the promised land, the final destination, faster and easier because you won't be going through the same errors. In addition, most organizations right now do not have the skillsets internally to be able to do it solo. So when you talked about vision, you talked about digital strategy, what do you see as a difference between the two?

Colleen Dabbs:
So let me just kind of back up a step here. As we talked about trying to create this digital branch, one thing institutions seem to forget is that your digital branch, your digital channel, is your largest branch. And so when you have a very small group of people focused on it, you do start to fall short. You do get overwhelmed by the day-to-day things that come into running a digital branch. Security, compliance, marketing, operational, all of those things really start to tie together.

Colleen Dabbs:
And so if you can get the financial institution to take a step back and say, "It's no longer just a digital group or digital person or whatever, it's now part of our DNA. We all think it all day long, and we take iterative approaches to that digital channel to make smaller changes versus big bang projects." And it becomes less overwhelming in that fashion.

Colleen Dabbs:
And so when you go back to your question, what's the difference between vision and strategy, if I know that there's a way that I want to communicate to my customers and members and there's a personalized experience that I want to establish with them but I don't have the right tools because my digital strategy is based on I'm just using a single vendor, then those two can't co-exist because I want to do something but I don't have the tools to make that happen. And so, trying to align those strategies and work with what you have is one thing.

Colleen Dabbs:
The second thing is that they've got to involve more than just digital in the day-to-day operation and running of that digital channel. And by way of example, we have several clients that are running one of our products that has a lot of flexibility to it. And they in their weekly management meetings, the first thing that comes up in their list of topics is what are we doing that's taking up resources, time, and money that's not in the digital channel and how do we get it there?

Colleen Dabbs:
And they are following more of an iterative, agile type development program where they involve us when they need to, they do it on their own when they need to, but it becomes part of their regular operations versus let's spin up a big project, let's figure who can add to their daily workload, let's take six months to build requirements, let's take another six months to figure out the right vendor. And then by the time you get to market, it's outdated.

Colleen Dabbs:
So you really have to get to a position where you can move faster and you've got the right tools, the right people, the right vision, the right strategy, all in alignment together.

Jim Marous:
Boy Colleen, that is a great point because we see a lot of organizations that we talk to that spend a lot of time in evaluating solutions between different vendors. And the time they lose, because I'm sorry there's no evaluation process that I've ever been in in the banking industry that's taken less than nine months. In fact, most of them take over a year if not longer. And then implementation is over and above that. Speed is of the essence today, and I think more than anything else it is better to make a slightly imperfect decision today than wait for what you think is the perfect decision nine months from now, which by the way because all the solution providers are always jockeying with different solutions, different ways of engaging, it is better to have that nine months of partnership under your belt and have that partnership really building instead of having that all be something internal that you're trying to evaluate because right now, paralysis of analysis is just amazingly detrimental to the speed of digital, to the speed of banking.

Jim Marous:
I used to comment that change would never happen as fast as it is today and it will never happen this slowly again. So if you're hoping things are going to wait for you, they are not. And again, in my meeting with bankers one-to-one over the last few weeks, I find that that's one of the major things that's frustrating to them in that their daily responsibilities are so big and they know this need for speed is so great that they work against each other. And again, that gets back to the partnering thing.

Jim Marous:
And Colleen, a lot of organizations that we talk to get really frustrated cause they go, "Yeah, my data sucks and I don't want to engage until I get that cleaned up first." At Fiserv, don't have a way to work around that in many cases where you've worked with all different kinds of financial institutions, all different sizes that have all different kinds of data complications, but it's your focus to say working to make this work towards your end goal correct?

Colleen Dabbs:
Correct.

Jim Marous:
There you go. Great answer, that's right. But I mean there's nothing you haven't seen, correct? I mean isn't that really the foundation on why you want to use a partner is that you don't have to wait until everything's perfect?

Colleen Dabbs:
Yeah, absolutely. And with Fiserv, we have a wide variety of products and services like you mentioned that run the end to end digital engagement channel. And one of the focuses that we've been trying to accomplish lately is more of a thought leadership around smart integration. SSOs are kind of a thing of the past, APIs are what everybody's talking about, but both of them come to the table with good things to offer.

Colleen Dabbs:
And to your information paralysis comment, if you start building out large APIs without the thought leadership going into how am I going to manage this going forward, how am I going to get updates going forward, how am I going to make things happen quickly, you kind of run out of steam. You can build it first very quickly, but then how do you maintain it?

Colleen Dabbs:
And so trying to look at a hybrid approach where you leverage smaller portions of an API that are easy to maintain and get quick access to commonly used features, versus leveraging single sign on to go deeper into the lesser used services, versus trying to rebuild everything. And that is another area where we find a lot of paralysis. Why are you rebuilding the wheel? Why are you trying to recreate everything over and over and over again? Let's start doing some smart integration to pull all the pieces together and let you keep driving forward in a more progressive fashion, versus trying to make everything perfect from day one and then how are you going to maintain that going forward?

Jim Marous:
It's interesting you bring this up that you really look at the situation to say trying to build on top of something that's already I'm going to call it broken for a digital bank is cumbersome. And we've worked with a lot of different financial institutions, and have found that those that are the most successful at what I'll call digital transformation, that can be redefined any way we want, are those that completely blow up what was there in the past and build from scratch. And what I mean by build from scratch is saying let's not take anything as being the rules because rules change, and I'll get back to digital account opening again that the whole engagement process, the beginning of the engagement process. Let's take Apple Card for instance for the first screen is here's all we know about you, confirm if this is right or wrong, instead of having me re-input everything that you either know about me or can find out about me.

Jim Marous:
And an organization we worked with said, "We got rid of everything and said the only time we're going to get the customer to do something is if we can't find it on our own. And it's amazing how much is out there in the data world that lets it so we don't have to start from scratch." But the problem is if you built it on the platform of the operational aspects or the data aspects that you used before, you just build a variation of we had before. And I'm sorry, I've been in financial institutions long enough to know it's probably going to be more cumbersome after than it was before because we add things. "We got to do this. We got to do that."

Jim Marous:
And I think what's interesting is it's really taken Fiserv the ability also think like financial institutions going how do we rethink what our business model is, how do we rethink how we deliver what we're delivering? Isn't that part of what the whole engagement process has been is the transformation of Fiserv as well as your clients?

Colleen Dabbs:
Absolutely. We like to say don't put old process on new technology.

Jim Marous:
Great comment, yeah.

Colleen Dabbs:
Because it just adds to the length and scope of the project and it doesn't add any value. And that's another key thing is is what you're doing adding value to that vision of where you want to be. And if it's not, if it's only just eliminating a temporary pain of people getting used to not having something, then you really have to give that a good, hard look as to whether or not that's going to add value or distract from the newer things that you have to offer.

Jim Marous:
So Colleen, you're in the field quite a bit, either virtually or in person. What is the difference between those organizations that are moving forward quickly and those organizations that aren't moving forward? Is it culture? Is it leadership? Is it budget? Is it people? Is there one key theme that you see you go, "Boy, I can usually see within a very short time whether or not this can be a painful process or not," for both organizations?

Colleen Dabbs:
I'm not sure my answer is going to be very popular with some people, but when there's a 300 page RFP to figure out what their next step should be, that's usually a sign that there could potentially be a problem with giving up old process to get to that next step. How you can digest 300 pages of data and information to make a decision, it just elongates that process.

Jim Marous:
Get you off the hook here Colleen because we see the same thing, that really the thing that is hampering, because we've done so much research in what I call post-COVID or anti-COVID world that says the one common denominator that is a difference between those organizations becoming digitally transformed, personalized, using data effectively, is leadership and culture.

Jim Marous:
And that's the hardest thing to change because let's take a mid-size financial institution. If I'm at a mid-sized financial institution, my top leadership has probably been in that bank 30 to 40 years. They in addition have surrounded themselves by other individuals that have been in the bank for 30 to 40 years. It is very hard to get change implemented in your mind and to disrupt old thinking if you're surrounding yourself by legacy banking executives. That's a big challenge.

Jim Marous:
Now if you're a small financial institution, you're a lot more agile because you have less people at the top. You have less people, maybe the same tenure, but they're more apt to take major risks.

Jim Marous:
The biggest financial institutions sometimes can buy themselves out of the problem. But I think at the end of the day, to your point, if you get a 200 page RFP, you're thinking the old way. Sometimes it takes nothing more than saying is this team that I'm trying to engage with on the same page as me because if I'm sending a destination a strategic end point or a vision that is different than I've ever been, I'm not going to have the right questions to make that decision to evaluate organizations. So we've talked about what makes it success. If there is one thing, the organizations that have done it best, what are some of the ways they've utilized data effectively to bring great results?

Colleen Dabbs:
The ways they've utilized data effectively? So I would say that when you are able to pull in data points from multiple locations and use that to market custom messages to the user, that's where you're most successful. And if you think about how marketing tiers work, you've got your tier one, which is your website, right? Here's some information, come find me, and this is the information you're going to look at. And then there's that second tier, which is I'm going to start targeting specifically to groups of people with information that may be relevant to them or they fit a couple of criteria that fall into play. And that's usually where a lot of people stop.

Colleen Dabbs:
But when you can get to that third layer where you really understand the behavior of the user or what they are doing in the digital channel, and then what they're not doing in the digital channel is even more important. So you may think you're the primary financial institution, but if you look at the core data and the history on their checking accounts and you start seeing Venmo and PayPal, then those are the primary financial institutions, not the bank or the credit union. So you got to look to see where they're spending their money.

Jim Marous:
You know, you're exactly right. We talk about the fact that you may still have the accounts, but you may not have the relationship. And to your point, Fiserv can help organizations find out how many of my customers have a direct deposit go into my account, but then immediately transfer funds out of my account within the first five days? Well there's a lot of people that do that, and it's getting greater and greater.

Jim Marous:
To your point, I have a small business account where PayPal is my primary financial institution. I still have my legacy banking organization, but the reality is I make all my payments and get all my receipts via PayPal. They also offer me ongoing lending options for small business loans and such. And so I know they're using my data more effectively. While if I wanted loan, I know that at my traditional financial intuition, it's going to probably take three to five days to take the application, take another three to five days to get an approval, and I'd probably have to go to the branch to do it all. That's not what the consumer wants.

Jim Marous:
And to your point, it really talks about experience. COVID has made it so that we expect more as consumers. We expect a Netflix type relationship that will proactively predict what I'm going to do and give me a better option. We expect an Amazon type relationship where you're going to get rid of some of the thinking that I may have to do and make it easier to find what I'm looking for.

Jim Marous:
You brought up websites earlier. In some cases, we're talking about reconstructing websites for personalization so that a person doesn't have to search around for basic information. And again, I want to emphasize, and this is so important for everybody listening, is that the ability to work with partners that understand the journey, that can apply success strategy that they've already seen work, can avoid the failures that they've already seen happen is invaluable, especially when most teams are really bare bones.

Jim Marous:
And speaking of teams, how big should the digital team be? Or does it really matter now that you can leverage other partners?

Colleen Dabbs:
I don't think it matters anymore how big the team should be because if you've got the right strategy in place, if you've got digital spread across the entire institution where everybody's thinking of digital as part of their day to day operations, and you've got a partner who is coming in, who's helping you use the tools the right way, who's looking at how you are leveraging what you have available to you, and then pointing out where you can be a little bit different.

Colleen Dabbs:
And that's the thing that we see all the time, especially with existing clients, is they bought a great product. They are using it. They've maybe fallen into some old habits, but when we walk in and see how they're using it we're like, "Oh wow, you're not even using it the way it's designed to be used. So let's get some training in place. Let's get some coaching in place. Let's pull in some other products that are going to make this work even better." And when they're open to those suggestions, when they're open to changing how they are doing that day to day operation, then they really start seeing the value of those digital services and leveraging them and making them work for them and meet their digital strategy.

Jim Marous:
Also, Fiserv is also continually modernizing your solution. So I may be using it the way that it was sold to me and the way that I originally knew it working, but you keep on making updates. And honestly, if I'm on the other end of the transaction as a financial institution, it's hard for me to keep track of all the different things that you're doing on my behalf. And really it's a matter of saying, "Okay, I want to continually be brought up-to-date." And sometimes it's nothing harder than raise your hand and going, "Bring me up to date and how I can use this data better."

Jim Marous:
And again, with so many clients, you have the ability in scaling to be able to bring the best solutions to the table and be able to bring those solutions that are going to make the biggest impact. And as we get close to the close here, I think one of the things that really is important, I think we've already established that it doesn't matter the size of organization when it comes to personalization. Any size organization can improve their personalization and can leverage partners to bring better solutions.

Jim Marous:
Number two, it's legacy and culture that's the foundation for stagnation. That if you can't embrace the change that's out there, embrace what you need to become, and maybe test some of the other providers out there, test Apple Pay, test Varo, test Chime, and see how they do things to see this is what we need to become. We won't get there.

Jim Marous:
But at the end of this Colleen, if you were to say, "I need to make one good victory, I need to have one good success, and this is going to be definition of how this relationship goes," what would you suggest being the first step that a financial institution should do today that's going to bring them almost an assured victory if they play by the rules and will do it quickly and easily?

Colleen Dabbs:
I would say the best thing they could do is to really understand their institution's digital strategy, what their tools and resources are, and then make sure they're aligning with a partner that's going to maximize that vision and that strategy.

Jim Marous:
Well said. And it's key because I think a lot of organizations hold back, and I'm going to go off script here a little bit and just say at the end of the day, you need to raise your hand. You need to call your solution provider out and say, "I need help with X."

Jim Marous:
Now, it can't be a broad statement. You have to have a destination in mind and what you need to do, but your solution providers such as Fiserv can get you there. It's not the first rodeo they've been in, and they're transforming digitally just like you are. And the key again is don't waste time on decision-making between who should I use because using anybody right now is better than trying to use somebody different nine months from now and having all this be analysis time.

Jim Marous:
Number two, make sure you're bought in. You have to be bought in to where you want to go because if you're only making it a good statement for the shareholders, you're not going to get there.

Jim Marous:
And thirdly, I think most importantly is get some early victories and those are easy to come by. If you work with your solution provider to find out how can they use data to drive better personalized contextualized solutions at a time when consumers and small businesses are making their decisions on who's going to provide the best experience, not the best products. The products are almost all the same. At the end of the day, who's going to get me to my financial goals and give me the best experience?

Jim Marous:
Colleen, I thank you so much for being on the show and I really appreciate the discussion because sometimes I forget what it's like to be a solution provider out there in the field. But I think the key here is that you can get that promised land, you can get to that position you need to do. It's not a project, it's a process. So Colleen, anything else before we sign off?

Colleen Dabbs:
I think this has been great. Thanks for your time today.

Jim Marous:
Thank you so much. You know, what a great conversation with Colleen Dabbs from Fiserv. She gives a great perspective as to how do we get through all the muck and actually implement something quickly and easily. And it goes without saying, as most people know that follow me, I believe partnering with solution providers is the way to go. And not to overthink the solution, but to implement something quickly and easily that's going to make an impact on your institution.

Jim Marous:
Thanks for listening to Banking Transformed Solutions, just announced as a Communicator Award of Excellence winner for Outstanding Branded Series by the Academy of Interactive and Visual Arts. If you enjoyed today's interview, please be sure to follow the show on your favorite podcast app. And we would love a review of our show.

Jim Marous:
Also, be sure to catch my recent articles on the financial brand and check out the research we're doing for the digital bank report. This has been a production of Evergreen Podcasts. A special thank you to our producer Leah Longbrake, audio engineer Sean Rule-Hoffman, and video producer Will Pritts. I'm your host, Jim Marous, and until next time, don't settle for status quo, reach for something greater.