Navigating increasing competition for large South African retail bank

Retail banks face the challenge of maintaining and growing core customer relationships, and consequently market share, in a competitive market that attracts agile, digital, customer-centric competitors.

Our client, a large retail bank, was exposed to these pressures.

Traditionally the customer’s main banking relationship was determined by where a customer held their transactional banking account. However, the bank found that other features – among these access to credit, loyalty programmes, service models and digital channels - were impacting customers’ choice of bank.

Transactional products themselves were no longer a customer acquisition tool. As a result, the bank required assistance to redefine its growth strategy for transactional products, focusing on how to grow transactional revenue.

To begin we determined that there were four areas we needed to consider: attracting new customers, ensuring that existing customers were offered appropriate transactional products, encouraging customers to transact more, and retaining existing customers.

We began our analysis by identifying key global themes impacting transactional banking and international examples of transactional banking innovations.

We completed an extensive analysis of the competitive retail banking landscape, looked at service standards and product offerings, and compared loyalty schemes, digital channels and self-service options. We analysed the business unit’s revenue drivers to identify revenue streams that could be improved. We also identified key dependencies between the transactional banking business unit and other areas of the bank.

This top-down approach allowed us to recommend areas in which the bank could positively differentiate between these areas and grow transactional revenue in the four identified.

At the end of the project we had helped the client identify a winning customer value proposition that fused product centricity with client centricity by recommending a dynamic product suit that was simple and appealed to customer behaviour and attitudes, thus serving them at every stage of their life journey.