Engagement Banking: Building Real Digital Relationships

Book: Bank 3.0: Why Banking Is No Longer Somewhere You Go But Something You Do Author: Brett King ISBN: 978-1-118-58963-2 Publisher: Wiley (2013)

Chapter 11 starts with a question that sounds simple but isn’t: does anyone at your bank actually know your name?

Not your name in a database. Not your name printed on a piece of mail. King means does someone at your bank know who you are the way a friend would? Can you call someone there and have them recognize you?

For 70 percent of bank customers, the answer is no. They can’t name a single person at the bank they use. And the bank talks about wanting a “relationship” with them.

That’s a weird kind of relationship.

The Amazon Comparison

King makes a comparison here that really lands. Amazon, a website with no storefronts, no checkout counters, no people walking aisles, somehow feels more personal than a bank branch. Amazon knows your name. It knows what you bought, what you might want next, how you like to pay, where you want things shipped.

Banks spend most of their energy trying to sell products through their public website. Amazon spends most of its energy selling to you behind the login. That’s the difference. Amazon uses what it knows about you to make your experience better. Banks mostly use what they know about you to send you offers you don’t care about.

And then there’s Facebook. King points out that Facebook creates and restores real human connections. Long-lost friends, relatives who haven’t spoken in years, old classmates. He even cites a stat that Facebook was mentioned in a third of UK divorce petitions in 2011. Whether positive or negative, technology clearly has the power to build relationships that feel real.

So why do banks act like technology can’t do the same for them?

Moments of Truth

This is probably my favorite concept in the chapter. King talks about “money moments of truth.” Banks have traditionally focused on big life events to build customer relationships. Getting married. Having a kid. Buying a house. Retiring.

Those moments matter, sure. But they happen rarely. What happens every single day is spending money. Every time you buy something, you’re making a small financial decision. Can I afford this? Should I wait? Is this the right time?

And where is your bank during these moments? Nowhere. Silent. The only feedback you get from your bank at the point of sale is when your card gets declined.

King argues that mobile changes this completely. If your phone is your payment device, suddenly the bank has a way to show up at the exact moment money is on your mind. Not with annoying notifications. With useful context. Your balance before and after a purchase. Whether this spending puts you off track for a savings goal. Whether there’s a smarter way to pay.

This idea was ahead of its time in 2013. And honestly, most banks still haven’t figured it out. Some fintech apps have gotten close. But the vision King describes here, where your bank helps you make better decisions in real time while you’re actually spending, that’s still largely unrealized.

The Social Media Problem

A big chunk of this chapter deals with social media engagement, and it shows its age a bit. The surveys and stats are from 2011-2012. The specific platforms and numbers don’t matter much anymore.

But the underlying problem King identifies? Still relevant.

Banks were terrible at social media. A Javelin Strategy & Research study found that Bank of America, Wells Fargo, and Citi were “generally not at all effective” at resolving customer complaints on Twitter. Only 4 percent of companies had a dedicated social media manager. More than 50 percent of banks had banned social media use at work entirely.

King calls this a “bricked-in mentality.” Banks saw customers as targets, segments, line items on a P&L statement. Not as people you’d actually talk to. The idea of engaging with customers one-on-one, having real conversations, was foreign to most banking institutions.

The fix, according to King, was to build what he calls an “Engagement Hub” with a senior-level social media strategist, cross-functional teams, governance policies, and real investment. He cites research showing the average corporate social media team at advanced companies had 11 full-time employees. And not one of the 18 “advanced” companies identified by the Altimeter Group was a bank.

The ROI Trap

There’s a section here about why banks struggle with innovation that rings very true. King describes a cycle that probably sounds familiar to anyone who has worked at a large company.

Someone has a good idea. The C-suite asks for ROI projections. But innovative products don’t have comparisons, so proving ROI is hard. The idea doesn’t get killed outright. Instead it becomes a poorly funded “pilot project” with part-time staff. The pilot never gets enough resources to succeed. But it lets executives keep talking about innovation at conferences.

As Chris Skinner put it: “Banks have so many pilots they should become an airline.”

The real issue is short-term thinking. Executives are measured quarterly. They’re rewarded for near-term performance. Investing in something that might pay off in three years? That’s a tough sell when your bonus depends on this quarter’s numbers.

The Prosumer Era

The chapter ends with some wild stats about how much information was being generated in 2011. Five exabytes of unique information in one year. More than the preceding 5,000 years of human history combined. Every 60 seconds: 100,000 tweets, 2.3 million Google searches, 30 hours of video uploaded to YouTube.

King’s point is that people aren’t just consuming content anymore. They’re creating it. They’re “prosumers.” And if banks don’t show up in the spaces where people are creating and consuming content, they become invisible.

The client experience gap, King warns, is widening. Customers feel confused, untrusting, disconnected. They want experiences that are personal and engaging. And banks are giving them branches, ATMs, and call centers. Generic, impersonal, transactional.

What Holds Up

The core argument of this chapter, that banks need to build real digital relationships instead of just processing transactions, absolutely holds up. If anything, it’s more true now than it was in 2013. The banks and fintech companies that have figured out engagement are winning. The ones still treating digital as “just another channel” are losing ground.

The idea of showing up at money moments of truth, especially through mobile, was genuinely forward-thinking. We’re still working toward the vision King described here.

The parts about social media strategy are dated in their specifics but not in their message. Lots of companies still struggle with treating social media as a real strategic function instead of something the intern handles.

The biggest takeaway from Chapter 11? A relationship isn’t something you claim. It’s something you earn by actually being useful when people need you. Most banks in 2013 weren’t doing that. Many still aren’t.

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