Banks in NZ enter Digital Universe, but are customers ready?
Banks in NZ entering the 'Digital Universe' but are their customers ready?
Banks have invested heavily in their IT systems to improve reliability and provide additional hi-tech services to their customers. The question arises: Are their customers interested in adopting these technology services?
Roy Morgan Research’s six Technology Adoption Segments have sorted New Zealanders by the way they adapt to, adopt and use technology in their everyday lives: “Technology Early Adopters”, “Professional Technology Mainstream”, “Digital Life”, “Older Tech Explorers”, “Technology Traditionalists” and “Technophobes”.
Each bank comprises a different proportion of customers from the different Technology Segments. ASB has the highest proportion of early-adopting customers (21.3%) followed by Kiwibank (18.5%).
BNZ has a considerably higher proportion of both “Professional Technology Mainstream” customers (22.9%) and “Older Tech Explorers” (12.2%)—with only 6.9% of its customers in the younger, savvy “Digital Life” segment.
Proportion of Banks’ Customers in each Technology Adoption Segment
Source: Roy Morgan Single Source, New Zealanders 14+, 12 months to September 2013. Sample size = 12,293. Respondents could select multiple banks they have dealings with.
At the other end of the spectrum, “Technophobes” and “Technology Traditionalists” are the laggards of adoption—but with over 2 in 5 Kiwis in one these groups, banks cannot afford to leave them behind. 42.2% of Westpac’s customers belong to one of these tech-wary segments, but ANZ has the highest proportion of the most wary of all, technophobes (16.3%).
Pip Elliott, General Manager, Roy Morgan Research NZ, says:
“Clearly banks must not only design innovative new banking technologies for their tech-savvy and professional customers, but also cater to the needs of the late-comers and laggards.
“With the rapid increase in mobile technology, financial institutions have long focused on introducing mobile banking applications that make it easier for customers to do their banking on the go. But some customers will ask, ‘Is this safe and secure?’ What needs to be done to make sure customers in the later technology adoption segment are ready and willing to take up these technologies? Are there educational and training programs in place for those that are intimidated by and don’t know how to use such technologies?
“Technology Early Adopters are an important segment because they are the first individuals to purchase and use a new technology. They present an opportunity for institutions to tailor their online or mobile offerings to this segment. They are more likely to be young people and mature adults aged between 18 and 40 who are well educated, employed full-time, and earning above-average incomes.
“On the other hand, Technology Traditionalists and Technophobes hold conservative values and are wary of change. Traditionalists will come on board once the technology is unquestionably mainstream, safe and simple; Technophobes, however, will hold out until it is absolutely necessary.
“Banks need to find effective ways to engage with all these groups and tailor products and services to meet each group’s requirements.”
Roy Morgan Research is Australia’s best known and longest established market research and public opinion survey company. Roy Morgan Single Source is thorough, accurate, and provides comprehensive, directly applicable information about current and future customers. It is unique in that it directs all the questions to each individual from a base survey sample of around 55,000 interviews in Australia and 15,000 interviews in New Zealand annually - the largest Single Source databases in the world. The questions asked relate to lifestyle and attitudes, media consumption habits (including TV, radio, newspapers, magazines, cinema, catalogues, pay TV and the Internet), brand and product usage, purchase intentions, retail visitations, service provider preferences, financial information and recreation and leisure activities. This lead product is supported by a nationally networked, consultancy-orientated market research capability.