Last week, the Singapore market saw a flurry of digital banks race to make their presence felt. On Wednesday, Grab and Singtel announced the launch of their first digital bank promising to “revolutionise banking services for its customers by leveraging its technological capabilities.” Targeting what it claims to be the “underserved segment” of Singapore and those in the gig economy, Charles Wong, Singapore CEO of GXS, said, “GXS is a homegrown bank on a mission to support the needs of the entrepreneurs, gig economy workers, and early-jobbers in our community.”
Hot on the heels of the launch
Standard Chartered Bank and FairPrice Group also made the presence of their first digital bank
, Trust Bank, felt with an all-out above the line marketing blitz running on platforms such as TV, print, digital, out of home, and creative in-store activations to create awareness of Trust and its shared heritage, as well as its range of product value propositions. With SG$400 million invested by its shareholders to date, Trust aims to redefine the digital banking experience for Singapore customers by simplifying banking for them and focusing on transparency to allow them to make informed decisions more easily.
With both banks launching simultaneously, it is expected that Singaporean consumers will be inundated with a slew of promotions across the city-state. In a conversation with MARKETING-INTERACTIVE, Nishant Kaushal, head of data, strategy, and solutions at ADNA shared that a study done by ADNA in the second quarter of the year, among approximately 3,200 people in Singapore found that 25% of the market has some level of dissatisfaction with current banking options available in the country. This dissatisfaction was significantly higher among the young where Gen Z Singaporeans are most likely to have a digital bank account, with 39% saying they have an active service.
Kaushal explained that this age group is one that values personalised service.
While many banks often talk about offering personalisation, what is executed often doesn’t match the customers’ expectation.
“To quote a customer I met in a focus group earlier this year ‘Netflix creates my own unique version of Netflix homepage, that’s the standard of personalisation I expect from my bank’s app’,” he said. This positive disposition towards digital banks among the young, combined with a higher level of dissatisfaction with the current banking options could help digital banks penetrate the market, explained Kaushal. “If the digital banks secure the Gen Z as their customers then their own future is secure. Catch them young, keep them for life,” he said.
Vishnu Mohan, partner and chief growth officer, said that digital banks are here to stay and we may see even more fragmentation within the sector before any kind of consolidation happens. While an absolute new to market digital bank brand may pride itself on the innovativeness and disruption, growth may be challenge. On the flip side, established brands with trust legacies would have slow but sustained long-term success as they are setting themselves well for the future generation.
“The marketing needs to hybridise the digital inventiveness in tone and style but at the same time be approachable and friendly - never easy but that's the test. The real growth of digital banks comes from its adoption by the wider population and the two main currencies that will define the success would be trust and value,” he said.
Standing out from the crowd using marketing
Ramya Vishwanath, director of Agile Program Management at Publicis Sapient shared that in a highly competitive and mature banking market in Singapore, digital banks need to have immediate and long-term strategy. On the immediate strategy-front, a focus should be placed on factors such as convenience, features, and security.
She added that market penetration can be expedited when new customers are enticed with services that provide ease of banking (transactions/cost) and compelling features. When it comes to long-term strategy, the focus should go beyond services that gravitate around banking. “Digital banks need to be much more than just your daily banking tasks – instead it must work towards creating financial, social and economic change, and opportunities,” she said.
But in all of this, marketing remains key. Vishwanath said:
Be clear about the business vision and the customer base that you want to target. Focus and tailor your products that speak to your customer base.
“The success and growth of digital banks relies heavily relies on the robustness of the technology that is in place. Invest in the engineering, automation and technology platforms, and tools for the enablement of the business vision,” she added.
In a market such as Singapore, consumers will switch and/or stay loyal to a bank that can offer them personalised features and benefits, added Tyler Muñoz, senior client partner, Thailand and Singapore Publicis Sapient. As such, digital banks must understand the consumer value exchange and continue to evolve their offerings.
“To deliver personalised products, digital banks must also focus on creating a world-class customer experience, supported by modern infrastructure that maximises the value of their data,” Muñoz continued.
However, it would do the brands well to stay focused and not “boil the ocean with too many digital offerings”.
“Think clearly about customer needs and break that down into consumer journeys. Understanding this will allow you to understand and differentiate your offerings,” he said. From an engineering perspective, he added that is important that digital banks build their architecture for change and time to market. It’s also important to place data at the very core of every strategy – each interaction a customer makes with a digital bank is an opportunity to co-create a proposition and build momentum.
At the end of the day, an out of the box thinking will also enable digital banks to stand out amidst the crowd, said ADNA’s Kaushal. This comes as customers today also no longer expect one company to meet all of their financial needs, and expect highly integrated experiences among various players. With the entry of the digital banks touting integrated experiences, and out of box thinking, they will bring a “different mindset and energy to this age-old industry labouring to go digital for a while," he said.
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