ANAHEIM, Calif.–Are you prepared for the “headless UI?” For “VR”? What about dealing with the "creepiness factor?"
Technology is no longer the sole domain of the IT department; increasingly it the primary tool being deployed by marketing and business development teams. A trio of experts from outside credit unions offered their insights into so-called “headless UI,” pain points and even the “creepiness factor.”
Speaking to the CUNA Marketing and Business Development Council annual meeting here were Maxwell Luthy, director of trends and insights at Trendwatching.com, New York; Neff Hudson, AVP-emerging channels, USAA, San Antonio, and Jose Resendiz, general manager, Digital insight, Redwood City, Calif. The session was moderated by John Best, president of Best Innovation Group in Denver.
Here’s a look at what was discussed:
Q: What is holding up the move to mobile payments?
Best: From what I’ve seen, Apple hasn’t been the big firecracker that we thought it would be.
From left, John Best, Maxwell Luthy, Neff Hudson and Jose Resendiz during session at CUNA Marketing and BD Council meeting in Anaheim.
Luthy: There has been research that shows repeat use of Apple Pay is going down, but it’s a typical example of a new technology and getting excited about it without thinking about the basic human needs and wants that we should service. In terms of eliminating a pain point, swiping plastic at a till is not that much of one. What I think is going to lead to that kind of hockey stick growth is when retailers, such as food and beverage brands, start bundling value into that e-commerce offering. People weren’t rushing to pay for taxis with their phones, but then Uber comes along with the ability to hail a taxi with your phone. So when we see rewards, that will be key.
Hudson: I disagree with one element; I think Apple getting off the sidelines was a big moment. Before that Google had spent somewhere north of $100 million and just couldn’t do it. I think Apple showed up with a different interaction model that everyone agreed could be a platform we could all use. Google has since pivoted and borrowed the Apple strategy. I think the platform side of this is figured out now.
Resendiz: I agree it has to do with value. You have to figure out what value you can provide in addition to eliminating any friction. One solution we have seen that has helped FIs to grow debit cards has been tying rewards to previous purchasing behaviors. So you get a discount at Star Bucks or Home Depot if you used those stores frequently. It never was spamming; it was a targeted offer. That raised debit card usage for these FIs. One CU in our program paid back $300,000 to their members in savings.
Best: I think we have cashiers terrified now. Go fill a cart and go to the cashier and take of your shoe and wave it at the terminal. They’re going to be fearful that maybe you have ShoePay.
Q: What should CUs do to help members who are tech adverse?
Hudson: When I think about solutions that have worked in the market, it always comes down to simplicity. And keeping it simple is one of the hardest things to do. I think of Square, which has an easy piece to plug in and an easy interface and a learning curve of maybe five minutes. You need to rethink the customer interaction from the very start and centering around areas that are tedious that people want to get rid off, like bill payment.
Resendiz: A lot of companies have done research on this; how do you get people to adopt technologies they won’t adopt. And time and time again it comes down to people being afraid of making a mistake that might cause them to lose their money. The second thing is concern around technology. You want to take advantage of the early adopters to tell the story. And if you pair that up with some sort of concierge function, it adds the hand-holding to help people to get through it. We’ve seen this at the branches with interactive video tellers. We’ve seen it with older generations who get upset in finding out there’s no teller. But once they go through the process they leave extremely proud. But it takes being curious about it and overcoming the fear of making a mistake.
Luthy: We have a trend called Video Valets, such as Amazon’s May Day button. Since then we’ve seen all kinds of companies doing that. Fiat in Brazil has a car showroom where people will walk you though a new car.
Q: What are some of the major trends related to digital banking?
Resendiz: Technology used in travel and elsewhere is setting our expectations. It’s not longer about just being a screen in front of you or a phone in your pocket. It’s the whole ecosystem around you that connect with the phone. We have been experimenting with what do you do when you know the location of an individual and you tie that back to providing them with more value. Could be a survey when a member leaves a branch, for instance. If they had a bad experience you can use a closed feedback system and follow up with them and turn them around from being a detractor into a promoter. When I think about how digital banking is evolving it’s about leveraging data much better than before. Instead of big infrastructure projects, it’s about connectivity and ecosystem of multiple devices.
Q: What about the creepiness factor?
Hudson: I think what we hear from our (USAA) members is that they chose to do business with us and they trust us. I think we have that in common with the credit union industry. They forgive us when we make a mistake. So you do have permission within a certain realm to make a suggestion. Everyone is trying to find ways to get consumers to spend more. What we hear form consumers is I don’t need help spending more money; I need help saving money, I need help understanding the trade offs between a short term decision and a long-term goal. I get that we have to make enough money to keep the lights on, and product offers can be made in the right context and it’s not creepy.
Resendiz: We were surprised when we launched these location-based services using beacons. We did a survey, and you have to be careful because people say one thing and do another, and people said yes, I would let the credit union use my location. But in this case 56% of a credit union’s members agreed to let the credit union use their location. More and more people are giving any type of app permission to use their location, and then they realize afterward, maybe I shouldn’t have done that.
Hudson: This is the classic disconnect. Every time you do a survey people say security, security, security. It’s the thing people expect, including someone else covering their liability in case they have a loss. It’s table stakes. You will get in trouble with disruptors who focus on simplicity.
Luthy: One of the exciting things we’re witnessing is new layers of contact. Regardless of where a consumer is, now even their emotional state is being monitored. (Spain’s) Telefonica can predict whether a user is bored just by how they are using their phone. As a credit union consider the possibilities if you can figure out when someone is feeling financial anxiety or dissatisfied with your service without giving them a survey.
Best: I think one of the biggest challenges we have in a country is the next generation with financial literacy. My generation has raised a group of people who are not savers. I see many banks in poor and rural areas that are obviously living off fees. I think using video and technology to address things like that, to encourage better habits, people wills see that and it will be useful.
Luthy: If you can provide that safety net for people, they are going to value you.
Q: What innovations or new technologies excite you?
Hudson:. Blockchain is the infrastructure upon which digital currency is based. But you can exchange anything on that infrastructure. I think over the next 10-15 years we’re going to see a fundamental transformation in the back office that is going to make things much more efficient and allow you to pass along savings. You can do title exchanges without having to go through a title company, for instance. I think from a backoffice perspective, it’s incredibly sexy, if there is such a thing.
Best: For a free white paper on blockchain, go to cublockchain.com.
Q: When and how should credit unions start to care about virtual reality?
Best: This technology is wicked cool.
Renendiz: It’s still early on, but the easiest space to start leveraging it now is education. It can be much more interactive, and I think for FIs that’s a starting point. You should look for partners to run experiments like that. Credit unions want to get a younger member base, but when they often do that it’s in a very traditional form.
Hudson: There are a lot of things I would spend money on first. Augmented reality is a better place. That really works well. You are actually taking the view they get through their phone and enhancing it. AR is a great way to get to VR. If I was spending money on anything it would be on headless UI, or no UI UI. (Example is the Amazon Echo.) That’s the interface of the future.
Luthy: I think no interface is one of the most interesting areas. Everything is going to be much more intuitive and seamless.