SXSW Day 2 – Banks: Innovate or Die (or just shout at your audience)

My Poor Head

It’s now day 5 of SXSW interactive, and as much as I had hoped to report back on a daily basis, the constraints of epically good tech sessions, combined with what appears to be limitless free booze has provided somewhat of a stumbling block to my mission.

I’ve been taking some notes from a few of the sessions so I’ll try to dump those here to give you a feel for what’s been going on.

Banks: Innovate of Die – Pannel discussion led by Brett King

A couple of the fantastic "Banks: Innovate or Die" pannel

Brett King is the author of Bank2.0, and agitator of financial service execs everywhere. He pulled together a panel of three of the leading players in the banking startup space; including Rob Garcia from Lending Club Corp, Bob Weinschenk, CEO of Smarty Pig, and Joshua Reich, co-founder of Bank Simple. Also contributing to the disucssion was Anna O’Brien is VP of Social Media for Citibank.

The Banks: Innovate or Die panel discussed whether the major players in the banking space had become too big to do anything cool or innovative for their customer base, and what new banking startups were doing to disrupt the incumbents and deliver the next wave of financial products and services.

This session was exceptionally interesting from a couple of perspectives: the topic of the future of banking is super hot at the moment as the big banks – both locally and abroad – are finally starting to see some cracks in their traditional oligopolistic business model; size and scale is no longer enough to keep out competition.

Secondary to that, whether by fate or design, placing a PR/Marking exec with a major bank background in the middle of four startups – in a session attended by some of the most cutting edge members of the industry – resulted in a massive clusterf*ck display of  some of the most defensive (and comical) reactions to commentary I’ve ever had the privilege of witnessing. Poor Anna O’Brien didn’t know what she had got herself into trying to defend bad customer experience, faltering online services, and the lack of anything even approaching customer development innovation within Citi. A few of her nuggests of gold included:

  • “Citi is your bank, not your mother! It’s not our job to remind you to pay your bills”
  • In reference to a discussion attendee stating they had recently moved from a smaller start up to a larger bank “Welcome to the dark side”. Funny, but totally inappropriate in front of an already hostile audience.

Josh from Bank Simple stated that he had personally made an effort to reach out to the first couple of thousand people who had signed up for their new service. To which Anna snakily replied:

  • “Good bank customer service only really works when you have thousands of customers rather than millions”

I tweeted in response to this comment:

  • “Don’t fool yourself that just because you’re big doesn’t mean you can’t have a personal relationship with your customers”

This generated a public calling out from Anna, suggesting I had misrepresented her statement. Highlight of my festival thus far!

The panel continued to discuss the importance of customer experience, and how the smaller players were at a significant advantage in their agility to build great experiences from the ground up, without the same weight of legacy bigger business is confined by.

Finally, some of my favourite tweets of the sessions:

  • UX is the key to banking.  Think about it.  UX is from mobile to branch to home.  Banks should be obsessed with UX. – @gjwood
  • Banks will become product manufacturers, and outsource the customer-facing front end. -@felixsalmon
  • Banking is commoditized.  Everyone offers the same product set.  Service is a differentiator.  Online experience is too - @BryanMishkin
  • Banks have trouble converging because of multiple systems.  It all starts with a strategy to unify data presentment @BryanMishkin
  • The challenge for startups is consumer trust.  For banks it’s internal risk aversion and regulation fear of the unknown @kbs200

Want to know more:

Tweet hashtag:

  • #bankinnovation (though there are also some good tweets under #bankinginnovation)

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Disclaimer

Long Straws is the personal blog of Stephen Colman.

The views represented here are mine and should not be considered representative of my employers.

Any posts containing statements around the suitability of financial service products should be considered "general advice" which does not take into consideration your financial background or circumstances. Please contact a licenced financial planner should you require advice in this regard.