Digitisation in Financial Services and Insurance: Key things to remember while preparing digital strategy

June 19, 2021 12:23 PM

An outcome of 2020 is the emergence of a digital economy – one where digital avenues and alternatives are just as effective as traditional engagements were in 2019.

digitisation, insurance,In the current marketplace, business leaders of FSI industry must explore new means of Customer Experience Management (CXM) to address the evolving customer demands

By Nitin Singhal

An outcome of 2020 is the emergence of a digital economy – one where digital avenues and alternatives are just as effective as traditional engagements were in 2019. While no digital alternative will ever replace the synergies that are borne out of physical, interpersonal interactions, it’s safe to say that the pandemic ushered in a digital  transformation of brands and processes at two broad levels – the absolute digitization of infrastructure and the focus on creation as well as delivery of holistic, empathetic and meaningful experiences for customers. This was especially relevant to the Financial Services and Insurance (FSI) industry across the world.

In the current marketplace, business leaders of FSI industry must explore new means of Customer Experience Management (CXM) to address the evolving customer demands. Here are four takeaways that they can action today!

Adopt a faster pace to digital transformation

Digital transformation has been taking place in FSI industry for years, but the sudden shock to the system last year caused an uptake in digital adoption across the industry. To reduce pressure on branch services and telephone, many FSI providers encouraged the use of digital and mobile channels. As well as offering convenience during a time of upheaval, this also presented an opportunity to deliver more meaningful interactions to customers. FSIs should use this momentum to continue investing in digital transformation. Job number 1 is optimizing their company website for different audiences, and that requires a strong digital platform and constant testing to ensure content and experiences are personalized for each visitor.

Max Bupa established its digital presence in 2020 with the launch of its website and was quick to sharpen its digital journey and create a completely unaided model where consumers could buy insurance end-to-end online. It was able to increase its website traffic by 70% in five months with more engaging and relevant experiences, and grew its direct business from digital from 5% to 15%.

Reassess Technology

Each year, FSI companies make heavy investments on their core systems, however, the pandemic highlighted that convoluted and outdated technology is still a major issue. Nearly twothirds of retail banking executives struggle with legacy systems while over a quarter of financial services and insurance respondents work across multiple martech solutions. As well as being frustrating and time-consuming, this fragmented approach also prevents companies from seeing a unified customer journey.

This is an opportunity, especially at a time when record numbers of customers are moving online. Companies shouldn’t think of transforming core technologies as a radical, one-off project, but something that can be done incrementally to minimize disruption! HDFC Bank has been at the forefront of leveraging digital and technology platforms to offer products and services for many years now. To support zero or minimal physical interface last
year, it curated seamless digital journeys for customers with innovative offerings like 10- second personal loans, Zip Drive and Zip Ride for four and two wheelers loans, Insta Account, and more.

Prioritise the data

The key to future success in initiatives such as automation or integrated technologies or customer experience comes down to data. In the 2021 FSI Trends Report, just 25% of companies believed that lack of customer insights was holding back their marketing and customer experience efforts. At the same time, only 27% said they have significant insight into the customer journey. This reveals a potential blindspot for many FSI organisations, indicating that they are undervaluing this area.

Data is the key. FSI firms should focus on integrating both online and offline data to help gain more visibility into what customers do online, thereby guiding real-time decisions and improving digital experiences.

Bajaj Finserv leveraged advanced analytics tools to understand evolving customer behaviour. With the smart use of data-centric business models, the company is achieving market success by fostering better customer connections and delivering personalized journeys.

Focus on meaningful interactions

The pandemic revealed consumer demand for better insights into their finances, triggering companies to recognize the importance of meaningful digital interactions with a much higher emphasis on personalized offerings and communication. FSIs should continue to focus on closing the gap between the customer, the channels they use, and most importantly, the experience they expect. They need to treat their customers and prospects as people and not data sets, and provide exceptional and relevant experience at every touchpoint to turn them into brand loyalists, adding further value through advisory and support.

Embracing the future

There’s no doubt the FSI sector is undergoing a fundamental shift. With role of digital having leapfrogged for all businesses in the pandemic, the timing is right for companies to think and work on their digital strategy that enables scale and operational efficiencies for years to come.

(Nitin Singhal is Managing Director, Digital Experience, Adobe India. Views expressed are the author’s own)

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