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04 Nov 2015

How user experience is disrupting pensions technology

I work in a large financial service business and have been responsible for developing our digital capability. Throughout this work what has become very clear is that UX (the techie term for user experience) and the experience this generates for customers can mean the difference between engaging your customers or turning them off.

So let me start this discussion with something controversial for all the marketing and proposition directors out there - your proposition differentiators, your USP (unique selling points), and your 'key features' have just become hygiene factors. You need to start diverting some of your marketing budgets to UX and you need to do it now...

In an industry like finance, the most successful players are generally 200+ years old with reputations built over a long time. So why is it that new entrants to the market, without the credibility of hundreds of years of managing money, are able to disrupt the sector and take market share?

What these successful entrants have shown is that by putting customer experience and UX at the forefront of their proposition, they can attract a new demographic of customer who get this experience in many other aspects of their lives. This is a real threat to established industries as it turns on its head many years of strategic planning and marketing investment.

Can this be right though? Surely customers choose a bank based on how strong its financial rating is? A pension based on how successful its long-term investment strategy has been? A cab where the driver has passed the knowledge test? It appears not, and this is something we can't afford to ignore. Now I'm not saying that these things aren't important, or t they won't form part of a rational person's decision making. I am saying that this alone is now not enough, and it may not even be the main influencing factor.

Let me give you a very real example of UX being used to disrupt traditional industries. Ever heard of Uber? I'm certain when black cabs first heard of this they would have laughed it away. Who would want to log in to an app when you can easily flag down a cab on the high street? What they didn't count on is the amazing user experience that Uber delivers. Suddenly it’s not just about hailing a cab - it’s about tracking the cabs knowing your estimated time of arrival, and doing so at a lower cost than before.

Uber screen

The extra features Uber offers were not the reason behind many people's first use. No, the introduction I got to Uber was ‘you have to try it, it's just so simple and enjoyable to use’". I didn't find out about the additional features until I was in a cab and found them by accident. That should be a big lesson to those who are still out there marketing a 'product' rather than an experience.

I predict newer entrants will take more of the traditional market share away from established firms who don’t develop a more customer centric UX. Even more of a worry is that these new entrants will also capture a significant proportion of the 'Millennial Generation', basically securing the market of the future for themselves. Don't forget, today's millennials are tomorrow's 'High Net Worths' meaning today's disruptors are tomorrow's major players .

The good news for those of you reading this worrying about your current builds or target marketing; this is something relatively easy to fix. Do you know how to understand what a customer wants and how they want to use something? Just ask them! That's what I've done here and the outcome is incredible. Customers are happy to help build something that will work for them, and are certainly more engaged with it as a result. I've seen a big increase in interest in our offering, simply off the back of a more engaging and user friendly UX. Pair with this a successful franchise and great customer features and suddenly the traditional can compete with the disruptor.    

This article was provided by Scottish Widows

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