Chloé James recently sat down with Rocky Scopelliti Head of FS at Telstra and leader of their ever-strong Millennials Report.
They had a quick chat about all things from digital transformation, millennials to money - and here is what Rocky, had to say;
“If we take a broad global look, as it stands today, the financial services industry really is extremely diverse in terms of its levels of transformation. At one end of the spectrum we see the US institutions doing really well on user experience, creating an engaging mobile application experience, whereas here in Australia, we see the banks as some of the top performing banks globally when it comes to their cost to income ratio. When it comes to operational transformation, the Australian banks really are up there with the very best in the world. In Asia, another skew, with huge levels of interest and investment coming from fintechs in the last year, alone 8.8 billion dollars of investment went into the fintech companies based within financial institutions in Asia, showing a wide and diverse range of performance and interest, in all aspects of transformation.”
We discuss the glaringly obvious inability to open a paper today with the word ‘millennial!’ jumping off the pages, and wonder how financial institutions can and already are, working with the millennial segment to offer them exactly what they need, when they need it and how they want it.
“For Telstra and in fact all service industries, millennials and their usage of mobile applications are a lead indicator of performance. What we’re seeing is this point and period in time - where in the absence of traditional institutions fulfilling their needs – millennials have a keen appetite (no qualms at all actually!) in trying alternative providers of service, which explains where the demand for a lot of this fintech usage is coming from. In our research, up to 2 in 3 millennials indicate an ‘appetite to try’ or in fact have already tried fintech which I think is the big opportunity for traditional institutions to address those statistics and needs.
It is clear we are moving into a millennial-led, mobile-first financial services world and in that world, millennials’ expectations of financial institutions have completely changed. To them it’s all about the experience and that the experiences they want to have with the institutions is personal. When we think about trust in general, and this is a very, very important point that we refer to in the report, when it comes to trust, millennials still trust financial institutions by a long shot compared to any other organisation or type and this is where the opportunity for traditional institutions lies. To not only build upon that trust, but to create the experiences that millenials are looking for through their mobile applications.”
A little more on the report Rocky has commissioned and perhaps been his muse for the past 10 years;
“The report covers 3 very important areas and sections;
1) Firstly we introduce the inaugural‘Millennial, Mobile and Money Index’which essentially helps intuitions understand how they are progressing in terms of their demographic change, as well as the utilisation of their mobileapplications. It is here where we seesome really interesting market dependent developments and trends; For example, Indonesia, China and the US are leading the market on those three indexes, which leaves a hugely important opportunity for institutions across New Zealand, Australia and South-East Asia to increase the consumption of digital mobile applications for millennials.
"Indonesia, China and the US are leading the market on ‘Millennial, Mobile and Money Index’ , which leaves a hugely important opportunity for institutions across New Zealand, Australia and South-East Asia."
Secondly, we look at digital transformation as really starting to make waves into the operating and business models of financial institutions, specifically how they need to transform to become what we refer to as expediential organisation’s in terms of their millennials performance.
When it comes to expediential, we are talking about it from a technological perspective - becoming a fully programable enterprise - which basically makes institutions completely elastic to meet the technological demands that occur throughout their businesses.
It’s having a network that is programmable where the institution can provision capacity wherever they need it, in any part of the business and at any given point in time having programmable processes to be able to meet the demands to process applications and services digitally, right through to programmable intelligence which is incredibly important, particularly in the context of cyber.
"It is important to make sure that as the institution increases the number of devises that are engaged, that it’s protecting itself and protecting its customers because that is at the heart of trust."
When it comes to trust, millennials essentially want 4 things from an institution, and, it’s pretty simple
1. Keep my finances secure
2. Keep my personal information secure
3. Keep private the interactions I have with you private and;
4. Ensure a solid reputation as an institution when it comes to security
3) On top of all this? Make It Personal. Make it about me. That’s the nirvana - and the number one thing millennials expect. If you’re in the ‘experience economy’ (which if you’re working in FS and reading this, you are) customers are expecting their institution will respect them and treat them based on a personal relationship.
No one’s a number anymore
So, where to next for Rocky and the report;
What we’re talking about in the report really is an amalgam of all of the things we’ve been talking about over the last few years in terms of new and engaging digital technologies, but we’re now adding this in the context of programmable infrastructure, programmable processes and really, how to become a programmable enterprise because when you look at all of the new dynamic companies that are starting today, they grow from a small base to very quickly becoming expediential in terms of how they perform.
"Make It Personal.Make it about me.
That’s the nirvana - and
the number one thing
At the end of the day, really transformation is about exactly that; “How do we make our organisation more agile? How do we make our organisation more scalable and to grow in a way the marginal cost of acquiring a customer, or the marginal cost of servicing a customer is virtually zero, which is really about how technology plays a central role.
The truth is, when we look back at the last ten years, ten years ago we were talking about digital banks, about how digital banks were going to transform the way in which we consume financial services. What’s interesting today is we are now talking about mobile-only banks showing that the last 10 years really has held witness to the unquenchable thirst people have developed for mobile-only based financial services, something that is really going to set the tone for what we can anticipate going forward as the now explosive growth in mobile by the undercurrent of millennials now assuming a greater role in society.
When it comes down it, Millennials now make up 1 in 3 of the global population, their proportionate representation as consumers, as employees, as investors and policy makers is only going to increase from this moment on and therefore, must remain at the very front of our minds.