rbs at the chief analytics officer forum, europe

In Retail Banking

© Copyright 2016 Liam Ó Móráin

DATA DIVIDEND DEFICIT

Contact info:

+353 87 905 8386

[email protected]

Liam Ó Móráin

March 2016


TOPICS FOR TODAY

THE DENTIST LOYALTY & PASSION THE PAIN & GAIN THE DATA DIVIDE OVERCOMING THE DATA DIVIDEND DEFICIT

To the Bank or the Dentist?

71% millennials would prefer to go to the

dentist rather than listen to what banks

are saying*.

*Millennial Disruption Index 2013.


LOYALTY & PASSION


Source & Copyright © Interbarnd 2016

LOYALTY & PASSION


Emotional connections make great brands. The relationship is often irrational!

Things that serve a purpose Things that people love

LOYALTY & PASSION


1.5M Apps, 100B Downloads, $30B Paid To Developers To Date

Source & Copyright © Techcruch 2015

1.5M Apps, 150B Downloads Various web sources incl App Annie, WSJ

Both realized if they created everything themselves it would greatly constrain the number and range of apps.

They became platforms where 3rd parties create products and services ‘apps’.

They maintain the standards for publishing the apps and pay the developers.

They are the distribution channel in this co-created ecosystem.

They get the power of data and its COMPETITVE ADVANTAGE

This ecosystem/platform and data-dividend is reflected in the market value

…. Co-Created Environments

THE PAIN and GAIN!


Capital Markets…

Information technology gives a competitive advantage Data is critical to the business and is a competitive advantage Algorithms and speed at its core

Retail banks (in general and especially in Britain)

Information technology is a cost not an enabler Data is a by-product and afterthought!

THE PAIN and GAIN!


Retail banks … some getting it! Especially in Australasia

Retail banks … some getting it in Britain Especially at the edges Local Insights

20 million members in Britain (1m 7 years ago)

15 million customers in Britain Constituency reports

THE PAIN and GAIN!

Retail banks … most not getting it or using its core customer historical data as

a competitive advantage but HSBC’s NUDGE using behavioural

science to influence behaviour RBS using AI for customer support silos of experimentation e.g. SPLUNK


THE PAIN and GAIN!

Retail banks … but, but, but

Non-traditional competitors using data to reach customers, drive their businesses and decision making, managing cost of acquisition and cost of serve Data at the core and part of the DNA


THE DATA DIVIDE!


Retail banks … are numerate from a financial reporting perspective but basically are innumerate from a business perspective … held together by Excel not by data! … are transactional and data intensive… but not data driven … live in an analogue world not a digital world!

BROAD customer

data – text based Bank Credit

Card

Day in the life of a customer What a Bank sees …

Customer: Joe Bloggs • Withdrawal Liverpool Station. ATM • Transaction successful • Account: -£50

On the way to work, Joe calls his

friend in Berlin.

At work, he Googles to research

impact of BREXIT crisis on

the stock market.

Joe wakes up in the

morning. He checks the

news on his iPad.

At lunch, Joe goes to the ATM

to withdraw money.

He pays for a wedding anniversary gift

for his wife with his credit card.

Joe calls his Bank’s Relationship Manager, Shirley, to

confirm the position of his stocks given BREXIT

refugee situation . However Shirley was not available

so he left her a voice mail.

Going home, Joe uses Twitter, Facebook and

LinkedIn account, and watches YouTube.

1

2

3 4

5

6

7

8

Joe gets home and he goes online on his iPad to

read books and surf the net.

Customer: Joe Bloggs • Credit card transaction

successful • Merchant: Cartier • Credit account: -£2,500

• Bank’s RM Shirley

receives phone message

to call Joe Bloggs.

Customers experience BANKS as a set of interactions through various

mediums throughout their busy lives, not as a number of “channels”.

On the other hand, a BANK sees the customer as a series

of discrete transactions with little context.

BANKS sees

these as siloed

transactions

within different

areas of the

bank…

How well do BANKS know their customers and understand their world?

DEEP customer data

Transactional Data – number based

Back end

systems

Connecting the dots...crossing the data & digital divide… understanding customers © Copyright 2016 Liam Ó Móráin

THE DATA DIVIDE!

ARMY OF 3rd PARTY DEVELOPERS

willing and able to marry the two

data sets and discover things of

interest to bank customers

Blending numerical and text data is a

bit like trying to mix oil and water!

THERE IS HOPE…PSD 2, Open APIs, Collaboration, and Co-creation

which will yield a DATA DIVIDEND for Banks

DATA

CHALLENGE

DATA

QUANDRY

Google, Facebook, UBER etc can be APPROXIMATE

Banks however have to be ACCUTATE,

PRECISE, and TIMELY

DATA MERGE


THE DATA DIVIDE!

OVERCOMING THE DATA DEFICIT!


Move for an analogue to a digital world

think transformation in music with move from vinyl to digital Automate, automate, automate. Collect, collect, collect (data) Embrace all data types not just numbers Harvest data for everywhere: the least bit might be very insightful! Open up the DATA VAULT! And partner with 3rd party app developers. Discover what the data is saying, figure out the questions it can answer, and VISUALIZE (a picture is worth a 1000 words)

In Retail Banking


DATA DIVIDEND DEFICIT

Contact info:

+353 87 905 8386

[email protected]

Liam Ó Móráin

March 2016

rbs at the chief analytics officer forum, europe

Data & Analytics