ANZ Bank has been engaged in an ongoing rivalry with the other major banks for technological superiority Photo: Jessica Shapiro
ANZ Bank's chief technology officer says banks have become obsessed with chasing the hype of big data, social media and mobility, arguing the technologies shouldn't replace existing strategies to keep customers loyal.
The bank is caught in an ongoing rivalry with the other major banks for technological superiority as each attempts to capture younger demographics when new products and apps, a challenge they see coming from the likes of Google and Apple as well as each other.
ANZ has committed hundreds of millions of dollars to upgrading bank branches and unleashing new mobile apps, and recently began testing IBM's Watson supercomputer to automatically handle low-level inquiries from customers.
But Patrick Maes said banks were caught up in the hype of new technologies like big data that distracted from serving customers.
"I'm not saying that big data is not important, that social media is not important, what I'm saying is it should be put in context," he told The Australian Financial Review.
"Big data is important, especially for the analytical capabilities but it is not a replacement for the structured strategy. I still have to know your address, your mobile number, your holdings, your ambitions and so on."
Each of the major banks, and smaller ones, have in recent months highlighted their respective big data programs as attempts to sell more products to customers. Commonwealth Bank has revealed plans to use "real-time analytics" to suggest products to customers during banking, while Suncorp similarly plans to consolidate data held by each of its subsidiaries to determine how many unique customers it have and potential on-sell strategies.
"There's certainly a level to which you can use these methods to sell more, but are you going to please the client by just being social media or big data-obsessed and not being clever?" Mr Maes said. "I think [in the] long term, the client will turn off.
"A bank wants to sell you a loan in most cases when you don't want or need a loan. Having a deeper understanding of that customer, that's when social media and big data comes in."
Mr Maes argued ANZ's planned use of the Watson was handling "real big data", as it would use the supercomputer's ability to learn from its own mistakes and use larger databases than previously available to banks.
He also argued that banks had become obsessed with 'mobility' as a defensive strategy, building mobile applications as new and separate siloes from the existing products.
"Putting the same old banking system on the mobile device is not going to change the price of fish," he said. "It doesn't really change anything."
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