Late last week, I went to an industry dinner at which the topic was Web 2.0 and financial services.
One of the interesting things about this dinner was meeting Dave Nicholson, who is a founder of Zopa (but now doing other things). Zopa is an interesting play in lots of ways, but the big question that we all have to answer yet is whether or not the underlying market for lending is going to be radically altered by this new model or not. Ebay did it for classifieds, so I suppose it is at least possible that it could happen in lending. In any event, my question to Dave was whether or not banks and P2P should be friends. His response was that from a Zopa perspective, it didn’t matter who was on either end of the transaction – the platform is about connecting those with money to lend to those that want to borrow. Apparently, institutional sources of money aren’t out of bounds. An interesting take on things, I thought.
But, anyway, the part of the dinner that interested me just as much was the way that everyone focused on personalisation. What struck me about this was not that personalisation was seen as important, but that it was seen as the most important thing for driving online sales. The oft quoted reports of Well Fargo and their data driven personalisation was used as evidence.
In thinking about the online channel in the light of work we’re doing in this space at Lloyds TSB, I’ve begun to wonder whether if, in fact, we have the personalisation thing backwards. You see, personalisation (in the form that most bank people think about it), is about setting up a unique and individual experience that we as banks think a customer wants. We use our data to make models that may or may not approximate actual customer intention, and then change the experience as a result.
In other words, we decide what personal means for the customer.
That’s not the way the rest of the web is going. Personalisation, everywhere else, means that the customer tells the service what they want. Probably they will consult with other people in their social network before they decide what they want, and probably, those people in the social network will have far, far more influence over the experience than the service provider.
Taking that one step further, it is users themselves, everywhere else, that are deciding not only how things are personalised, but also what content should be shown in the personalised context. We can see where social finance is going when examining Mint, Wesabe and others of their ilk.
So, sitting around the table listening about “personalisation”, I couldn’t help but wonder if we’re somehow stuck in a financial services time warp. Or at least, why the institutional part of the market is.