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Digital Innovation FAQs: Customers, Experience, and Disruption in Consumer Lending

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Digital Experience (DEX) decides your next strategic move today. Customer journeys have taken the front seat and are fueling the disruptive force. Consumer Lending organizations looking to connect the dots of digital innovation often ask me to address these FAQs

#1 What is Innovation?

This is the most asked question in our Digital Experience (DEX) engagements. Simply put, ‘innovation’ is about new ideas that generate value for both the customers and the organization.

In our DEX workshops, which are typically about 4-6 weeks, we work with our clients to understand their customers and their brand values… it makes innovation and the opportunity space tangible. That helps us generate innovative ideas that unlock value for both customers and business and reflect their brand values. Everyone wanted to be Apple. Decades later, there’s still one Apple. Google, Amazon, Facebook… they all did what they are good at… even Microsoft now.

The key is to stay focused on your customers, listen to them and stay true to your brand values and capabilities to deliver great digital experiences. A lot of the opportunities in regulated industries like financial services and consumer lending are in making complicated things simple:

–    simple to understand,

–    simple to buy,

–    simple to sell.

Beyond that, digital experiences are about helping borrowers focus on buying their dream home and helping brokers and loan officers to build relationships by focusing on what their customers want and freeing up time… instead of worrying about document verification, regulations or what are a hundred things to check. That’s where the most significant opportunities lie.

#2 How do you deal with Millennials?

Customer Experience starts with understanding customers, and it’s no different for millennials, though many of us are not millennials. Interestingly, we find millennials also want good relationships with their mortgage lenders and brokers.

A recent Fannie Mae survey found that almost 2 out of 3 customers relied on real estate agents and lenders for information. Millennials are also looking for help from lenders, brokers first and they appreciate transparency.

Of course, they are more than happy to use digital channels to complete forms, but they also want to talk to their loan officers and brokers.

They complement each other quite well, and we try to ensure the digital ecosystem is there to enable this interaction and deliver exceptional experiences.

…what about loan officers and brokers? Do you still need them?

They are vital to the experience!

Contrary to what many lenders think, our research finds most customers (borrowers) are commonly influenced by them, and they remain the most trusted, along with friends and family. They remain some of the delightful experiences that we design for.

Fannie Mae also found that over 90% customers (including millennials) want to use in-person channels at key points…they want to talk to their lenders. This is not about a loan approval; this is about buying your dream home.

#3 What about the latest trends… Design Thinking, Artificial Intelligence (AI), Big Data?

It’s about the relevance of the trends. We stay on top of the latest trends and set some of them as well. At Tavant, we work with clients on defining customer-centricity programs and the omnichannel strategies that can enable great experiences. The focus is on customer and business value and finding relevant solutions; the digital experience is really about the customer experience.

Lemonade, perhaps, is one of the better examples of that. They use chatbots to settle claims within minutes, and most of their customers are honest because of that little behavioral tweak where they ask customers to pledge to be honest first.

Technology by itself uncovers excellent operational efficiency. That remains a focus but, in our DEX engagements, we try to define digital experiences that unlock immense value. We have been fortunate to work with clients who trust us with cutting-edge technology and setting the benchmarks in these areas.

Design thinking, the blockchain, behavioral design, big data, AI…they will transform digital experiences as we know it today. We see tremendous opportunities in some of these trends and innovation, but it is all about what is relevant to our clients. The strategy has to be based on the company’s brand values, its culture and how it is most pertinent to their customers.

#4 But where do you start? What next?

More on strategy, simplicity, and execution in my next post. Stay tuned!

Digital Innovation FAQs Part II 

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