Big Data & Social: Advantages of Incumbents
I was reading the slides of Mary Meeker, the famous (now former) Morgan Stanley analyst, on 10 Questions Internet Execs Should Ask & Answer and among all the available information noted these slides on the unusually high level of innovation within incumbents. It is an interesting statement and it could in some way be the basis of a different way to view banks and financial institutions.
It seems that big data and social will be two of the major factors that will shape the user experience in the future, including in regards to banking and financial services. For both these aspects, size matters and banks have what it takes to make significant moves in those directions (even if it may be more difficult in the social space)
– The basis of Big Data is … a lot of data. And most likely, when talking about human experience, it means a lot of humans. Banks, with their numerous accounts, transactions, information have the basis for providing a meaningful experience. Citi, through its partnership with Bundle, is making good use of its aggregated anonymized information to provide important financial references to the Bundle PFM users (compare yourself with other users, identify most relevants shops and restaurants).
On that perspective, the “prototype” of Banksquare: the new sharing service from your bank, as envisioned by Chris Skinner, gives a possible path for building this experience with the existing network available. Connecting local businesses, people, offers, reviews in a meaningful and valuable way (for example, an exclusive offers for a bank client from the businesses served by the bank?) is something financial institutions should start working on.
Note: on that point, however, having a large user base is necessary, but not a guarantee that a social network will flourish. Google’s failure with Buzz is a good example.
To conclude: Yes, incumbents have some of the characteristics to become relevant in a more data-driven and connected world; it is time time for them to kick into overdrive to do so.
