As technology advances, so does the way we do business. There was once a time where companies and corporations operated separately from growing technology trends. But now, they have become so intertwined that it is becoming increasingly difficult to do business without being involved with the latest pieces of technology.
From Bitcoin to crowdfunding campaigns, finance has been utterly transformed by different technological pursuits. There is now an entire industry in the advertising niche that deals completely with in-app and online advertising strategies. Innovators are creating apps that give customers instant access to their business services.
The world is truly changing all around us. There are countless ways in which technology is transforming finance – and here’s a few of them.
1. Customer Data has Become a Strategy
According to Lifesci Advisor Services, strategy has become one of the most important key terms when dealing with the relationship between corporations and the media. Most financial institutions use customer data to make certain decisions, and this is more important now than ever. In fact, the very definition of customer data has been changed.
If a financial company wanted to determine the creditworthiness of an individual or a business, they would look past just their credit score. Because of the way people use technology, financial institutions can now take a closer glimpse at people’s purchase history, as well as their behaviors on different social media sites. If a small business has a great Facebook page with a lot of “likes”, that could increase their creditworthiness. Otherwise, if the individual or owner of the company is always checking in at bars on their social media account, it could count against them.
2. The High-Margin Process is Being Automated
In the past, financial companies would need to hire a wealth of individuals to help customers manage their finances in a variety of different way. Now, a lot of wealth management services have become automated, meaning that customers can provide the service to themselves using an online tool.
For example, if a customer wants to figure out how to minimize their taxes or allocate financial assets in the best way possible, they can typically do so by logging into the financial institution’s web portal. Then, the customer can click on various sections of the website to obtain their advisory services.
While many financial institutions still prefer to have the personal touch of a human advisor, these automated high-margin processes are saving tons of time and money, while also increasing efficiency. Customers love to be able to access that kind of information instantly, and now they can due to technological efforts. Plus, there are still human advisors available when customers really need them.
3. Financial Institutions are Collaborating with New Entrants and Incumbents
This is something that would be quite unheard of in the old economic market. Aren’t new disruptors supposed to completely overtake the economy and compete with their neighbors?
Now, corporations are collaborating with new entrants. By communicating with incumbents, they can learn more about the emerging trends and technological advances in the industry. While the air of competition still exists, it is on a much more sustainable level, allowing incumbents to have a relationship like never before.
This is just the tip of the iceberg when it comes to the ways in which technology is transforming finance. As each economic period progresses, we see new trends and strategies that are unlike anything from the past. The world is constantly challenging and questioning the ways in which business people do business, and financial institutions are piggybacking off these new trends to provide bigger and better services to their customers. Stay tuned to see what changes are coming up next!