Is smart UI the next big thing for personalised banking in the experience economy?
Banks are trying their best to engineer unique and enthralling user experiences from the ground up to increase the economic value of their offerings.
Tuesday February 12, 2019,
5 min Read
For some time now, “experience” has been the buzz word that has increasingly gained prominence in most business sectors. The banking sector is no exception. Today, around the world, thought leaders are reiterating that it is not about the goods that are being marketed any more, it is about personalised experiences.
Back in 1998, Joseph Pine and James Gilmore authored an article, titled Welcome to the Experience Economy, in the Harvard Business Review. It pointed out that the experience economy would follow the agrarian, industrial, and the service economies. While the idea seemed ahead of its time back then, 20 plus on, it perfectly describes the state of businesses today. They explained the concept with a simple example. “The entire history of economic progress can be recapitulated in the four-stage evolution of the birthday cake. As a vestige of the agrarian economy, mothers made birthday cakes from scratch, mixing farm commodities (flour, sugar, butter, and eggs) that together cost mere dimes.
As the goods-based industrial economy advanced, moms paid a dollar or two to Betty Crocker for premixed ingredients. Later, when the service economy took hold, busy parents ordered cakes from the bakery or grocery store, which, at $10 or $15, cost 10 times as much as the packaged ingredients. Now, in the time-starved 1990s, parents neither make the birthday cake nor even throw the party. Instead, they spend $100 or more to “outsource” the entire event to Chuck E. Cheese’s, the Discovery Zone, the Mining Company, or some other business that stages a memorable event for the kids — and often throws in the cake for free. Welcome to the emerging experience economy.”
We can see a similar trend at banks too. From being buildings where you could deposit and borrow cash, banks have come a long way in terms of the services and products they offer. Today, banks offer customers access to most of their products and features seamlessly through multiple channels (mobile, web, branches, agents, and so on). However, mobile devices have gained prominence over other channels due to the convenience they offer. And in the near future, we can see extensive use of augmented reality, virtual reality, and artificial intelligence to enhance banking experiences.
Focusing on differentiators
The reason for this evolution is quite simple. As economies have evolved and people’s tastes have gotten more refined, run-of-the-mill offerings have become fungible. Differentiators are expected at every step of the consumer experience journey because an experience is not a nebulous idea; it is as real an offering as any other (goods, services, or commodity). And, as services got commoditised like goods before them, experiences have emerged as the next step in what Joseph and James in their article states as the “progression of economic value”.
To increase the economic value of their offerings, banks are trying their best to engineer unique and enthralling user experiences from the ground up instead of simply wrapping an experience layer over their traditional offerings. This is because experiences are deeply personal and two people seldom have the same experiences. This implies that substantial research and shift in mind set is necessary to deliver engaging user experiences.
A common trend we have been seeing for some time now is how the competition has evolved. Things that we never thought would compete with each other have. For example, the mobile phone has taken over the market of music players, digital assistants, cameras, navigation devices, voice recorders, bar code readers, step counters, timers, alarm clocks, and more. This means that there are unique ways in which apps can be designed to leverage different functionalities and deliver a unique user experience. So when every bank has an app for their customers to access products and services, how can one app be better than the other? The answer is simple – design and develop the customer touch point, aka the app interface, to be as smart as possible.
Why smart UI is the way ahead
This is where smart UI comes into play. A smart UI is combination of user interfaces, business logics, widgets, and event handlers that focus on making the most commonly used features as accessible as possible to the user. And the reason why this feature in an app makes it a winner is that an app comes with plenty of functionalities built into it. However, there would be very few or no users that uses every single one of them. Today, with the help of machine learning models and artificial intelligence, it is possible to automatically customise user interfaces to mirror a user’s usage patterns. For example, if a customer uses the functionalities fund transfer, view account balance, and pay utility bills, over a period of time, the app screen would display these features as the primary functionalities of the app. Every other feature would be accessible by tapping a “More Options” button or something on those lines. This feature makes the experience of using the app as personalised and convenient as possible to a user.
However, it must be taken into consideration that layouts don’t go haywire whenever there is an update/upgrade in the app. Customisation algorithms need to be designed in a way that maintenance remains hassle free.
Going forward, it is quite clear that smart UIs would become a must-have feature rather than a nice-to-have feature because in a world where the lives of people are played out through the screen of a mobile device, delivering personalised user engagement experiences would definitely need smarter interfaces. In the meanwhile, let us wait and watch to see how different banks and businesses go about achieving this.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)