Winning customer loyalty is a marathon, not a sprint

The Melbourne Cup in Australia is famous for its heart-pounding finishes, surprising turns, and the thrill of watching champions outpace the competition and etch their name in history. It's a spectacle of strategy, agility, and endurance - much like the race Australian and New Zealand banks are in today. The stakes are high, and the prize is even higher: customer loyalty. In this fast-paced environment, the question is: does your bank have what it takes to win?

The stakes have never been higher

The financial services industry is more competitive than ever in Australia and New Zealand. Banks face immense pressure to modernise, deliver seamless digital experiences, and keep pace with skyrocketing customer expectations. Once-reliable legacy systems and outdated processes no longer cut the mustard. Digital disruptors like Afterpay, Xero and Humanitix have rewritten the playbook, proving that customers demand more - speed, convenience, and personalisation. Those who don't adapt risk being left behind in the dust.

But it's not just about outpacing other banks. Today's competitors come in the form of agile fintechs, mighty tech giants, and even your own customers' evolving expectations. With nearly 99% of banking interactions in Australia now happening digitally, customer experience isn't just a feature - it's the make-or-break factor for banks aiming to lead the pack and secure top spot in the hearts and wallets of their customers.

Australian and New Zealand banks face a digital watershed moment

The larger banks in Australia and New Zealand are currently prioritising investment in modernisation programs to systematically address their long-ignored technical debt accumulated over many years due to their legacy systems and through their historical acquisitions. They are endeavouring to break the habit of layering newer technologies or introducing further point solutions on top of outdated infrastructure, which has in the past compounded their technical debt and increased system complexity. This approach may have provided short-term solutions, but it limited their ability to innovate and deliver integrated, customer-centric engagement platforms.

Customer-centricity: The critical advantage

Like the Melbourne Cup, where a jockey's relationship with their horse is as important as speed and endurance, the banks that win today understand their customers deeply. Customer-centricity means knowing customer preferences, anticipating needs, and delivering frictionless experiences at every touchpoint. Today's real differentiator is offering digital services and creating meaningful, tailored customer journeys that keep people coming back.

What separates the winners from those lagging?

• Agility to adapt: Banks that quickly roll out new products or services in response to changing market demands are positioned to stay ahead
• Tailored value propositions: Personalisation isn't a buzzword; it's a necessity. Banks that deliver customised services and offerings based on customer segments create deeper connections and foster loyalty
• Omnichannel experiences: Modern customers expect seamless transitions across mobile apps, online banking, and in-branch services. The winning banks unify these channels to create a consistent, seamless experience that gives customers control and ensures convenience.

Why some banks are struggling to keep up

Not all banks are running this race on an equal footing. Legacy systems slow many banks down, preventing them from being agile and responsive. Outdated technology can be costly, limiting their ability to innovate and improve customer experiences. According to industry studies, up to 80% of banks' IT budgets are consumed by maintaining these legacy systems, leaving little room for innovation (McKinsey). 

Engagement banking: The game changer

To overcome these challenges, leading banks are turning to Engagement Banking Platforms—modern solutions designed to meet the needs of today's fast-moving, customer-centric world. These platforms break down silos, integrate services across touchpoints, and allow banks to deliver real-time, personalised customer experiences. More importantly, they create a foundation for progressive modernisation, where banks can incrementally upgrade their systems without large-scale disruptions.

Here's how Engagement Banking helps banks not only accelerate but also outlast the competition:

Tailored value propositions: Deliver personalised services that adapt to each customer's needs, building deeper relationships and enhancing loyalty

Journey-based modernisation: Modernise critical customer journeys, like onboarding, with end-to-end integration—boosting efficiency and improving the overall customer experience

Incremental wins: Embrace a step-by-step modernisation strategy, allowing your bank to update technology in manageable phases without disrupting daily operations

Unified architecture: Create a single, integrated platform that unifies all customer and employee interactions, breaking down silos to deliver a consistent experience and accelerate time to market
Platform synergies: Innovate faster with a composable platform foundation, reducing operational costs and maximising customer lifetime value

Banks that embrace Engagement Banking are positioning themselves as leaders in the race for customer loyalty. They're not just offering a digital solution; they're delivering value at every customer interaction, personalising experiences, and outpacing competitors by focusing on what matters most: the customer.