Accounting for unique human behavior expands not only the quality of experience, but also the effectiveness of technology solutions.

As I have already discussed in this Technology Vision 2017 series, digital technologies are impacting numerous aspects of financial services, with developments in artificial intelligence (AI), new digital ecosystems, and open talent marketplaces. In this post, I will talk about the new frontier financial services institutions are facing in digital experiences: technology that is specifically designed for humans.

From simple personalization to fully customized experiences

Today’s digital technologies have the capacity to not only interact with customers and employees in a more natural, human way, but to understand personal and workplace behaviors and goals, and respond appropriately.

Based on our Technology Vision 2017 survey of 5,400 business and IT executives, including 589 respondents from the banking industry, and 563 respondents from the insurance industry, financial services institutions are already putting these concepts to work.

Banks are rethinking customer journeys

In banking, human contact is diminishing in terms of volume, but increasing in terms of quality and importance. In their quest to shape the quality of the customer journey and the effectiveness of technology solutions, banks are beginning to recognize the importance of adapting for unique human behavior.

  • In our survey, 34 percent of bankers said they were planning to extensively use human behavior analysis and insight to guide customer experience design.
  • The majority (80 percent) also agreed that organizations should understand not just where people are today, but where they want to be, and shape the technology to act as their guide.

Banks are well advised to adapt their model, infrastructure and workforce to ensure that every customer interaction is a low-friction, enjoyable experience that fits with the way customers want to interact, not how the bank wants them to interact.

  • Robo adviser servicing start-up Betterment, for example, uses smart design to intuitively guide customers to the right investment decisions. Betterment’s design features offer the best potential options based on customer behavior, and its new offerings include access to human certified financial planners and licensed financial experts.

A new level of insight in insurance

In insurance, maturing AI tools and Internet of Things (IoT) interfaces in the connected home, car and workplace are allowing organizations to gather, analyze and act on customer data in real-time.

As a result, insurers now have a level of insight that allows them to:

  • Shift from pooling and pricing risk based only on historical data to automatically assessing and pricing risk directly, individually and in real-time.
  • Provide customers with real-time services and risk management solutions that address their real goals.
  • Understand which incentives will motivate positive changes in customers’ behavior to reduce claims while strengthening long-term customer relationships.

For insurance, more than many other industries, this is a significant step forward. In essence, the new goal for carriers is to help define a path that people can follow to reach their goals.

New technologies can help insurers do so in many different ways.

  • Numerous auto insurance carriers now use vehicle telematics data to adjust premiums to customers’ actual driving rather than just driving history.
  • Home insurers AXA and Local Tapiola in Europe are looking to connected-home technologies to help customers avoid claims from the start, and to incentivize good habits.
  • Europ Assistance’s Connect et Moi fragile care offering uses a smart box in the home to learn a person’s daily rhythm of life and send automatic alerts or help when there is a deviation from the usual routine.

In my next post, I will take a look at Trend 5: The Uncharted.

To learn more, access the full Technology Vision 2017 report, as well as the Technology Vision for Insurance 2017 and Banking Technology Vision 2017 reports.