It Pays To Be Personalised

How Atom Bank has developed a truly customer centric bank

Ahead of this month’s Building Business On Behaviours event, DISRUPTIONHUB finds out how challenger Atom Bank is delivering personalisation to its customers.

Atom Bank was founded in 2014 as a mobile first, app only business. Developed on the principle that digital banking could offer true value to its customers, Atom currently offers savings and mortgage products with a view to becoming a full service bank. But how does Atom ensure that it delivers a personal service, especially with an entirely digital business model? According to Chief Marketing Officer Lisa Wood, it’s all about being customer-centric.

It’s your bank, not ours

Personalisation has emerged as an unstoppable trend across industries, but how exactly does Atom Bank deliver personalisation to its customers, and what are the benefits?

“Personalisation can take on many different avenues but some of the aspects are making it really simple and easy to do things. We use biometrics as our security login, using a customer’s own identity to get over some of the frustrations over passwords,” she says. “We also give you your own unique brand when you join. It’s your bank, not our bank.”

In the future, Wood envisions a financial world that will evolve from traditional to customer centric structures where data has a key role in helping people understand their money. Also, data has given organisations the opportunity to better understand their target markets. However, it’s not just about gathering the data – but what you do with it.

“It’s about using the technology that is available to take that data and make it useful, and the structural changes around open banking which is encouraging an API driven sector. Through APIs, you can connect your banking relationships, which gives you a really true view of your financial picture.”

Being mobile first and digital, Wood explains, has also been an enabler for personalisation. Without digital technology, customers wouldn’t be able to have their own unique brand. But how does a fully digital bank retain the human touch?

“The human touch is really, really important to us,” says Wood. “We want to be a non corporate, non traditional bank, so when we were designing the bank, we thought long and hard about our tone of voice and how we wanted to interact with our customers. We know that while customers now are very comfortable doing things through digital, when something goes wrong, they need the reassurance of a human to sort it out for them. Within the app there is a chat feature, and we have 24/7 contact centre.”

The challenges for challengers

Entering a traditional, legacy sector dominated by major players is no easy task, but according to Wood, one of the major challenges Atom has come up against is changing entrenched consumer behaviours.

“When you look at switching behaviour, people don’t voluntarily think about finances and decide to move banks. That apathy is quite difficult. They might open another account with you, but do you get the full value of that relationship? 85 per cent of current accounts sit with the big high street banks, and generally, people aren’t moving. There has been some success… Monzo, for example, say they have a million customers. It would be interesting to know how many of them are active customers rather than just being a second account.”

New entrants aren’t the only ones with hurdles to overcome. Major banks may be coming to see the value in personalisation, but their incumbent structures and risk aversion have made it hard to adapt. This is partly due to technological issues, but also their established model which is not built with the customer at the centre.

“There are a number of things that banks have to do to warn customers that they are using their overdraft, but if you were really using data for the customer you would predict when that overdraft will kick in and suggest preemptive behaviours to stop it. The current model is not built for customer centricity. They’ve got shareholders and stakeholders that expect a certain level of profitability, so it makes it difficult for them to do the right thing.”

Personal, not presumptive

Despite the need to put customers at the centre, personalisation isn’t a fix all solution. Lisa explains the importance of sensitivity, especially when talking about personal data.

“When you’re doing communications, you would not include personal account data. You have to be very sensitive to what you’re sharing openly with consumers. From a marketing perspective, there are quite a few brands that think they are personalising, but aren’t being very smart about it. If I look at something online and then that product follows me around the internet in an advert, the brand thinks that that’s what I’m about, but I could have been looking at something for my daughter. That kind of personalisation is presumptive, and you have to be very careful not to do that. That’s why we put some of the personalisation power into the hands of the customer, so they can choose the level they want.”

This is what Wood refers to as true personalisation, which starts and ends with the customer.

“When I think about personalisation, I think about how we are using data as an industry to help customers make better financial decisions. The interesting dynamic with big banks is that it’s not necessarily in their best interests to have their customers make better financial decisions because they then lose income. There’s a vested interest, and one of the fundamental issues with the industry. That’s what FinTech companies are challenging.”

In fact, without offering this kind of personalisation, financial organisations could alienate their customers and discourage new users. Even so, Wood expects the big banks to recognise that there is a need to change in order to retain their customers.

“I think they will survive. They are understanding that the latent behaviour of customers is going to change – they can’t rely on customers sitting on a really low interest rate account. It’s going to be easy for a customer to buy a better product, link it up and have a better view of their finances.”

That said, it’s not the big banks that are leading the charge. It’s the FinTech challengers, and also regulators. Open banking, Wood believes, will transform the relationship between banks and their customers. Now that anyone can easily buy a better, more personalised product, you can bank on industry wide change.

To hear more from Lisa Wood, join DISRUPTIONHUB and our partners Hotwire at the upcoming Building Business On Behaviours event. We still have a small number of seats available here.