Banking on Digital Growth
Banking on Digital Growth

Episode · 1 year ago

21) #ByTheBook: Think Beyond the Present Moment or Get Stuck in the Past

ABOUT THIS EPISODE

Is your financial brand stuck in the present moment?

Too afraid of risk? Of loss?

If you don’t think strategically about your future…

You’ll get left in the past. 

In the latest By the Book episode, I explain how the natural risk-aversion of financial brands prevents actually becomes a liability in the future. 

You can find this interview, and many more, by subscribing to Banking on Digital Growth on Apple Podcasts, on Spotify, or here.

You're listening to banking on digital growth with James Robert Lay, a podcast that empowers financial brand marketing, sales and leadership teams to maximize their digital growth potential by generating ten times more loans and deposits. Today's episode is part of the by the book series where James Robert on locks and shares the secrets of digital marketing and sales strategies for financial brands from his best selling book, banking on Digital Growth, the strategic marketing manifesto to transform financial brands, that is now available on Amazon. Let's get into the show. Greetings in Hello, I am James Robert Lay and welcome to the twenty one episode of the banking on digital growth podcast. Today's episode is part of the by the book series where I share insights for my best selling book, banking on Digital Growth, the strategic marketing manifesto to transform financial brands. I'd like to start off to day by giving a shout out to ramy tea for his Amazon Book Review Rommi Rights. For someone who has been in the financial industry the digital transformation sector, this book is a must. I always talk to my clients that you could, you could have the best online and mobile banking channels. Still, without the right audience and customer base to use them, these channels will be useless and will bring no added value to customers more than checking their account balance or making a build payment transfer. Romi continues. My approach working with clients has always been we plan, we build, we grow, and digital marketing plays a role in each of these stages. Rami shares. I was so pleased to finally find a book that addresses how digital marketing can help you build that lasting relationship with your clients and truly nurture it to provide them with the personalized...

...experience they seek. This is a much read for every banking executive, regardless of job function. As financial institutions need to embrace a growth mentality across all functions. Rami ends I will be recommending this book to my clients well. Romi, thank you so much for the kind words and I'm glad that you have found this helpful. You'd also shared that this was a was a go to guide, and, speaking of guides, it's what I want to do, dear listener on this podcast, when a guide you and those that you work with beyond what I call digital denial. Now, digital denial is actually closely tied to the three future growth pitfalls that I had unpacked an episode number nineteen. We get trapped in digital denial when we're shortsighted and we don't see the enormous digital growth potential ahead for really what it is. A lot of times we'll try this, will try that, will dabble, but we give up when it doesn't yield results quick enough. That's such a mistake. When any industry is transformed by disruption, inevitably the digital growth potential will always it will always appear limited at first, and deceptively so. You see, when we're thinking about digital growth, we're thinking about digital transformation. Value Creation out of the gate is most likely going to lag for some period of time and in some cases it might be non existent, or even if there's a tremendous upfront cost to establish new foundational systems, processes habits, it could feel like an enormous weight that just drags us all down. But don't be fooled. This is one of the deadliest blind spots but also the most common. See...

What happens when digital denial is permeating within the leadership team at a financial brand. The leadership team mistakenly makes their most important decisions based on past performance, based on past success, and this is very understandable, as these folks, mind you, they've built their entire career on past performance. But now they're in a situation where they're stuck in the present moment. But they're making these strategic, present day decisions, whether that be around marketing cells growth models, rooted in past perspectives, past experiences, which have really been informed by earlier successes that are no longer relevant or even useful anymore, specifically in this post covid world. So what do you think happens when they do that? Well, it really just depends the result of their decisions. They might not be disastrous. They may as well continue down a path of will call it disincremental linear growth. The trend line will nudge up, they'll get that two x performance versus the ten X that I've spoken about in previous podcast episodes. But that's it. They're not taking advantage, and this is the key. They're not taking advantage of the exponential growth curve that digital makes possible. You see in digital value creation there's a deceptive doubling effect referring back to Peter Diamondus's and Stephen Cottler's book, The d's model, which I noted an episode number eighteen, where digital first appears to bring a loss, but then the value and...

...the growth generated by digital becomes twice as great, which becomes four times as great, then eight then sixteen. It's the doubling pattern which will continue until you reach a point where digital growth becomes the primary driver of growth and eventually crushes the old legacy growth model built around the physical world. Let's look at Amazon, for example. According to the STREETCOM, without aws and without the prime membership program Amazon lost around two billion dollars in q one of two thousand and eighteen. Now this loss is really rooted in the retail side of their business, which, interesting makes up about sixty percent of their entire revenue model. Put this another way, sixty percent of Amazon's total business operated at a loss. However, they have offset these losses with more ultiple, diverse revenue streams like aws, Amazon web services and their prime membership program so what Amazon is doing, and really what they have done since the very beginning, is they are playing the long game, which is opposite of what we see a lot of risk averse financial brand leaders who are looking at the situation in the present moment, but they're being informed by past decision. So they play the short game and when we're stuck in the present moment, we really risk getting crushed, getting run over and never even making it into the future. It's a heads down versus a heads up way of operating, but unfortunately I'm still seeing it's very typical of today's legacy leaders. They stay heads down, they're trapped in the here and now. They're using passes and previous biases and previous wins and successes for their decisionmaking, instead of being heads up, looking towards...

...the future and seeing exponential change for what it is. And it's this heads down approach that results in the drowning of the deep overwhelmed that are discussed an episode number nineteen. It's true that business leaders across the board, in multiple verticals and multiple industries. According to a report from Duke University, they found that ninety seven percent of business leaders believe strategy is important. That's great, but ninety six percent don't feel like they have the time to think strategically. If you have not listened to episode number nineteen. I go deep, Deep. It's a fairly lengthy episode, but it's all about the importance of breaking free from the doing, breaking free from the here and now, the here and now which is oftentimes for informed by the past, to create that space and time to review, to reflect, to learn to think, so that we can do even better going forward. Now, leaders at financial brands would be wise to buck this trend. And sure they're, you know, bakers by default. I get it. Once are there going to be more risk? It verse, it's it's what we do. We limit risk. We're dealing with people's money, but it may be for a lot that the limiting of risk becomes a liability, it becomes a cost, and that is what will take so many down in the coming years. I am for you. Please do not let our strength become our greatest weakness or a fatal flaw. Technology has transformed our world and digital has changed the way consumer shop for and...

...buy financial services forever. Now consumers make purchase decisions long before they walk into a branch, if they walk into a branch at all. But your financial brand still wants to grow loans and deposits. We get it. Digital growth can feel confusing, frustrating and overwhelming for any financial brand marketing and sales leader. But it doesn't have to, because James Robert wrote the book that guides you every step of the way along your digital growth journey. Visit wwwagit growthcom to get a preview of his best selling book banking on digital growth, or order a copy right now for you and your team from Amazon. Inside you'll find a strategic marketing manifesto that was written to transform financial brands, and it is packed full of practical and proven insights you can start using today to confidently generate ten times more loans and deposits. Now back to the show. We've been lucky to have avoided a lot of the pain, a lot of the misery, for example, that the music industry went through that I spoke about on episode Nobre Sixteen. We've had the the the luxury to learn from the failures of brands that have been down this journey before that aren't with us today, the blockbusters, the borders, the toys R us. When it comes down to it, this is what legacy banks and credit unions have been doing historically. They're essentially retel or retail like institutions. That like blockbusters, borders, toys r US historically have been built for the physical world. And, as anyone who has read the news in recent years knows, the retail sector is in trouble these days, specifically post covid and I was just reading report...

...recently brooks brothers, another wellknown brand, has filed for bankruptcy. But it's interesting because Simon Malls is picking up these bankrupt brands like brooks brothers the buckle for pennies on the dollar. And what Simon is trying to do is to capture all of this because Simons malls, they want to be the last mall standing. Now, when we look at these legacy retail brands, blockbuster, and we are, we're going through a retail apocalypse right now. And what these legacy retail brands lacked was leadership, and that is why there's a direct distinction between financial brand leadership and management, where we really must look at this in two areas. Managers Operate and the present moment to avoid risk and loss. On the other hand, those in leadership positions look ahead to create the future that does not yet exist. Let me be very clear here. One is not better than the other. Great leaders need great managers to apply their strategic thinking to ensure it becomes a reality, their vision becomes reality, while great managers need great leaders to ensure that they don't get stuck in the present moment and make decisions informed by the past. This isn't happening nearly enough, and it's one of my biggest concerns for financial brands in today's post covid world, in this digital economy, because the number of managers managing financial brands in the present moment for the present moment, informed by the past, far outweigh the number of leaders leading their financial brands with current Ridge, with confidence,...

...to create a bigger, better, brighter future. How, then, have financial brands not yet been decimated by digital disruption? That is a really big question ask. For one, banking is a very different kind of consumer experience than, say, listening to a song, watching a movie, ordering food, ordering a book. The level of risk when it comes to banking from from the perspective of the consumer is obviously much higher because they are trusting you, they're trusting your financial brand with their life savings. But a lot of that risk is also just perception. And here's the thing that perception of risk is rapidly changing. Just think for a moment. It used to be that people were scared to use their credit card online, and now we know how ubiquitous e commerce has across almost every industry. Still, perception is perception and perception shape's reality and consumer research, at least pre covid, showed that when it came to banking, people, including millennials, wanted to have a physical branch location. It's going to be interesting, interesting to see how this plays out postcovid as new behavior and habits are formed. But Pre covid it's that entirely logical. Why this was the case. You know, people were already doing online banking, mobile banking, but they were reassured to know that a physical branch was there. They could drive by and and say, Hey, it's nice to see the building and think that that's where they keep my money, even though we all know that the money is not kept there. But, like I said, this this isn't logical, and when we're dealing with consumers we're dealing with eological beings. The other thing I want to note is...

...the perspective of government regulation and how that has slowed down the pace of disruption in the financial market place. That also is changing and we're seeing some of that coming out postcovid with the Charter for Non Bank fintech firms and more entering the market place. And the fact of the matter is financial brands can no longer stave off this coming demise much longer. Either we're going to have to make some courageous decisions and lead, or we're going to get left behind. And like it or not, when it comes to digital will growth, it really is the survival of the fittest out there, and that that I did. The survival of the fittest, what I call digital Darwinism, is the topic that we will discuss on the next episode of the by the book series, because I don't want you, I don't want your financial brand, to end up like the dinosaurs. Until next time, be well, do good and wash your hands. Thank you for listening to another episode of banking on Digital Growth with James Robert Laigh. Like what you hear, tell a friend about the podcast and leave us a review on apple podcast, Google podcast or spotify, and subscribe while you're there. To get even more practical, improven insights, visit www dot digital growthcom to grab a preview of James Roberts best selling book banking on digital growth, or order a copy right now for you and your team from Amazon. Inside you'll find a strategic marketing and sales blueprint framed around twelve key areas of focus that empower you to confidently generate ten times...

...more loans and deposits. Until next time, be well and do good.

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