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Hosted by top 5 banking and fintech influencer, Jim Marous, Banking Transformed highlights the challenges facing the banking industry. Featuring some of the top minds in business, this podcast explores how financial institutions can prepare for the future of banking.

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Reinventing the Customer Experience in a Digital World

Organizations in all industries need a new operating model that puts the customer’s needs at the center of all digital transformation strategies. This can be achieved by redesigned customer journeys, new products and services, and the agile delivery of insights and contextual solutions across channels.

To better understand how legacy financial institutions can better position themselves against digital pure play organizations such as Google, Amazon, Facebook, Apple and Alibaba, I sat down with Sophie Heller, Group Chief Operating Officer for Retail Banking at BNP Paribas. Sophie discusses the critical elements required to launch an integrated operating model organized around end-to-end experiences in an open banking environment.



Jim Marous: Well, Sophie, it's really great to have you on the show today. When we met in Paris, as I mentioned, it was just such a great engagement and got to know you a little bit. But more importantly, the amount of things that you're doing at BNP Paribas, it's quite amazing. In your LinkedIn profile, you mentioned that you're interested in transforming existing organizations towards customer-centric organizations with the state-of-art digital capabilities, and you've been doing this for 20 years. Is that true?

Sophie Heller: Yeah. Yes, it's true. Although it was very different, because I started more as an entrepreneur, and then I went into a more medium-sized company. Now I'm really tackling a very, very big organization such as BNP Paribas, as you know. So, it's increasing complexity, which is good because I could really leverage on my past experience, but it's a very exciting challenge.

Jim Marous: So, Sophie, we look at the whole issue of personalization as being one of the keys of what we can do with digital capabilities and moving that forward. How are you reinventing the personalization of the experience and the customer experience overall at BNP Paribas?

Sophie Heller: Okay. I think there the couple of reasons why we need to reinvent a customer experience, and even more globally the business model. We have new competition, neo-banks, and GAFA. Google just announced something recently. New expectation from customers, and as you say, they want more personalized, they want quicker, easy, and cheap. We have the low rate environment that puts a lot of pressure on revenues and regulation adds cost. So, it's really about redefining, not only how we acquire customers, how we serve them and how we equip them, so I think that we can go progressively through all of those three items. But I think this is pretty much everything that needs to be covered through this reinvention.

Jim Marous: Yeah, let's go through those three items. That'd be great.

Sophie Heller: Okay. So, if we start with the acquisition, I think that the one-bank-fits-all strategy doesn't work anymore. And we, in the recent years, as far as we are concerned, we've really come out with new simple, cheap digital offers based on what clients want most. So, if I take for example, [inaudible 00:02:21] is an [inaudible 00:02:23] and a card and an app for people that just want to pay and get paid. So they don't need a credit, they don't want a mortgage, they don't want investments, they just want to be able to pay, but they still want to manage cash. So, it's a very simple offer, but in partnership with a network of the 6,000 [inaudible 00:02:43] shops, we can also manage the cash aspects. If I take another example, for people that are self-directed and they are looking for daily banking as well as simple saving and credits we have Hello bank!

Sophie Heller: So what I mean by those two example is that, we can no longer have the same offer for everyone because in function of your situation, your context, your attitude, you will want different things in your life. And so the bank needs to really reinvent these offers. And I must say that we also recently started to do this also, not only through our brand or directly with customers, but also in the ecosystem logic with partners. So I can take the example of Telepass, I don't know if you're familiar that, have you been to Italy recently?

Jim Marous: Yes.

Sophie Heller: It's the leading toll payment brand. So what we've done is that with them, we created an an app for professionals but also for individuals where you can manage everything around mobility. So pay for the tool of course, but the petrol, automatic invoicing also for the petrol, which is important for SMBs, small business, but also pay for your organize for a car lease and et cetera. And so it's a way for us to acquire actually a lot of customers through a completely different channel. So they come with these basic offers and then you need to discover what are the other needs they have that you can cover. So it's really completely redefining a new strategy for acquisition. And this, I think, the first important part of reinvention of customer experience.

Jim Marous: So when we're looking at these different acquisitions and deployments that you're doing for acquisition, you're almost implementing an open banking model to acquire different segments of customers that would not have normally been served as well in the typical BNP Paribas, right?

Sophie Heller: Yeah. This is exactly it because when you look at the [inaudible 00:04:57], and by the way you know that was an acquisition. So it was actually a FinTech that was created by entrepreneurs. And we realized that we didn't have the right offer for this type of clients, so we bought the company. In the case of Telepass, it's not an acquisition, it's really a partnership with, not FinTech, but a big organization, which is this toll payment leader. But the ideas is all is really to start... The same common point between the two is the really you are much more precise about what type of customers, what want what? So what is the value for them? And then you need to design your offers around what they value most.

Sophie Heller: And this is a very big change for banking. Because the bank used to say, okay, I'm a bank so I'm sitting there at every corner of streets and people would come in. So I think that one of the thing that digital changes into the acquisition but not only, but now we are talking about acquisition is the fact that you need to be much more precise at identifying exactly the value added that you provide for each kind of customers.

Jim Marous: So what you've done then also, you deploy some of these different solutions into different markets and you have numerous markets worldwide. Do you then use those almost as test labs that you might end up then rolling out the same type of services in other markets?

Sophie Heller: Maybe I'm going to surprise you, but I really don't believe in labs. I mean I don't believe in labs as a separate organization because I think that the big risk in having a lab is that you conceive something which is completely outside of the company, and then you don't get the buy in, you don't get the integration to really make it work. It can work perfectly for completely standalone business. So maybe we take an example after that with [inaudible 00:06:53], which is really a startup which it's completely separate. And in that case it works.

Sophie Heller: But I think that in that case, when we're talking Telepass, we're talking about still a way to acquire new clients through this partnership, open banking partnership, but for the bank. And in that case it's much more efficient to work as a with a small dedicated teams of course with the new ways of working. And we'd come back to that I think, but in an environment where you already have the people that are already involved from the start, so you make sure that you can industrialize otherwise the big risk of the lab is that you have something which is like a proof of concept, but you are not able to scale it and industrialize.

Jim Marous: So when you went to ING, one of the major benefits that they had was their agility, but just as importantly their speed and ease of use. Right as the beginning of the customer experience, how are you improving the speed and ease of use of your services at BNP?

Sophie Heller: I think I would, we've discussed... I think there's the what and the how and your question is important because we need to be very concentrating on defining what we want to do but also have the right attention to how we are going to do it. And I think that in the how and under your question, I understand how you also transform a big organization such as BNP Paribas. I came out, I mean the job for three years now and when I realize what really I've learned from this experience is that I think that you need to come with a holistic and longterm view because this is really a system that you are changing. Second, I would say that you really need to have a direction, and you need to come with some method and need to explain to the people why you need to transform, how you're going to transform and how you're going to do it.

Sophie Heller: Then I need... What works really well, I think it's make sure that you experiment. Everything that you talk about, you make a pilot, you make a success with the people that then need to take it further so that they have a first success. They are happy with the results and they can talk to other people in organization to scale it. So let's meet with just two concrete examples. We've mentioned when when you were in Paris, the fact that in order to change the culture of the organization, we've implement the net promoter system with the 100,000 people. And of course this is huge, but the way we've done it, it's taking a bit of a system, which was for example, measuring the branch satisfaction and get the service regularly after the customer we're in and have the branch people call back all the detractors being really into listening mode. So they could then once a week have a meeting where they was sought out all the problems that they could the the the work in the hand.

Sophie Heller: In order to do that, we don't [inaudible 00:10:00] those pilots with the 10 different branches and some regions. And by coaching the people they realize that it was really different from what they were doing before. And I think unless you really implementing very concretely with the people and the experiment what it is to do those type of callbacks, and these type of meeting, they actually don't understand what is really... How different this is from what they were used to do. So I think this for me as as a key success factor, is really having the, the the method but then pilot it always find people that are going to spread the good news for you.

Sophie Heller: Another example would be in a artificial intelligence. Artificial intelligence, we were convinced in my team with a data scientist that we could really improve the scoring algorithm that we use. So we've made a few pilots in a private colleagues business and also credit for a poll. And we were able to generate amazing growth in NBI with the same level of risk. And that came really quickly. So when we implemented the two algorithm and we made the proof by doing it, then it brought the results, then you can convince the whole organization to do it systematically.

Sophie Heller: So I think yeah, holistic and longterm view, the direction, the pilot and also maybe the central team also and a local team. You need to have people that have the expertise, the passion, and that are able to coach and train the people on the field. Because this is really a big work. And for most of the people in organization, this is not their work. They have the business as usual to do. And this is on top of, so you really need to provide that support. This is a little bit the four points that I think are really important after those three years of experience.

Jim Marous: So one of the other things you've done to improve the customer experience and to get closer to what the customer's journey is, is you build a partnership with and working with Personetics. and how are you using them right now? Because you are obviously the, I think the first implementation overseas of the Personetics model. How are you using that model?

Sophie Heller: I think this is, we talked before about necessity to review the acquisition and the other two parts are how do you serve your clients differently and how you sell differently and you equip them differently. So Personetics for me is a great enabler for the 2 out of 3. Let me explain. The two, I think that people that are using digital services of the time, they expect the bank to adapt to that. So whenever you want to change your credit limit, you want to manage your daily accounts, you want to be able to do as maximum on your own. So we, we developed over the recent years, really many functionalities on the mobile and that works just fine. But now the next step, and this is where Personetics comes into play, is that I think we are very good at having a lot of functionalities and you can do many things in [inaudible 00:13:26] mobile.

Sophie Heller: Then then the paradox is that the most of the products, especially the relatively complex products, they still require a human to to be sold. Because these are not impulsive product that you wake up in the morning, you say, "Oh, I'm going to buy a credit or a saving account." So Personetics, for me, it's a part of our strategy to core capabilities to implement a strategy which is really starting to have and engage a personalized conversation through the BOMA, the mobile, with a client. And Personetic help us to implement insights, personalized insights for the customers. So that can be things as simple as we look at the account and you will receive a message telling you, your accounts suggest that you hit your credit limit a few times. Maybe this is time to upgrade your card to a premium or infinite card that has a higher limit.

Sophie Heller: And in that case you will be able maybe to subscribe online directly. But imagine another insight that we will provide that will say, we noticed that you have a capacity to save 100 Euro each month, but you don't have a sending program. Would you like to discuss that with your relationship manager and click here to book an appointment. So I think the next thing, we've been very busy the two last year in really building a state of the art application for managing the daily banking that works fine. We had some awards. But now the next frontier is the one of using mobile to really have those conversation. So this initiative you mentioned with Personetics is already live since one year in Luxembourg. So we tested the first part that was clients really love receiving those insights. So we can be the type of example I gave you, but all the things that are also very useful to customers such as, Oh, you bought something on Amazon and this is the credit back or any other eCommerce firm.

Sophie Heller: So you show that you've been reimbursed. And what we are really busy now is, is really building those insights where we will detect opportunity for contacts also with a relationship manager. So if this is where the mobile is the center of gravity or their relationship but it's really in relationship with the account manager.

Jim Marous: So really you do see a, you do see a utilization rate, a deployment that really mixes digital with human, don't you?

Sophie Heller: Yeah, absolutely. We are convinced that we have different models because I think as I said before, we are all different, and we have different attitudes, and our attitudes also vary in time. So I think that we'll see a computation, I think of a very digital offers, very simple and completely digital offers. We see digital offers where you can always have someone a call center just for assistance. Or you will have a little bit more completes models where you will have always the digital and the center.

Sophie Heller: But then you have possibility to have more expertise, more bespoke advice because you are talking about investment, preparing your retirement, but also making sure your house is properly insured and all those things that are better suited for human conversation. And I think as a bank, which is not, we have digital banks, but we also want to continue to have this relationship on more complex needs. This is where the fascinating thing for the years to come is really to reinvent those digital applications. My vision is that our applications currently, and pretty much all applications, are very much still driven by the old way of presenting the accounts that were on paper. So we put the accounts and we put your statement and etc. But if you think of it and for the customer, and we've already prototyped some examples that that are really liked by the customer.

Sophie Heller: As a customer, you would like to know that you have your house and this is what regards your house. So you have your mortgage, you have all the invoice on the cost related to your house, maybe you have a sort of estimation of the value of the house in your neighborhood, the last transaction you want to know so that all the utilities contract are those ones. And maybe you could save some money by changing provider. And then you have another environment that are your kids, so your kids do you have saving plan? Do you have something that you are working on to prepare the financing of their studies in the university?

Sophie Heller: And maybe you have another topic which is retirement. So I think that for me, the next evolution, the next generation of digital application will be much more organized around the themes or the objective of each person. And this is where also we'd go back to the theme of open banking you were telling before, because of course, the more you move into an ecosystem and need oriented digital application, and the more you will partner with people that are bringing new services into those environments. So yeah, I do really believe that this is the way.

Jim Marous: Well and you, you mentioned open banking and this week we did have the announcement of Google possibly partnering with Citibank and another financial firm. But, the reality is what they're doing is they're using their vast platform to try to get more engaged in the customer's life. And from what you've discussed and what we've discussed in the past, that's really what your bank's trying to do. You're trying to expand the services so that there's greater engagement on a daily basis in all different ways, not just in a traditional banking way. Correct?

Sophie Heller: Yeah, absolutely. I think that, and we have no certainty of course, but I think that in Europe, in particularly, people are very concerned with the privacy and with data protection. And they still regard banks very much as a trusted partner for everything that we got. The security, the money and the data. So I think there's this... And they view the bank has really legitimate to talk about many issues that involve money in a certain way. So the house is where you need to take decision that may really impact your money, but as well your health. Also mobility. Mobility represents 13% of your budget. So it's everything which is really impacting your budget. I think the bank is legitimate to help you find better solutions. So this is a little bit the limit that we set. And the way we do it is really a test and learn. So we've prioritized those three ecosystem, home, mobility, and health. And we are doing experiment at the moment on those three. So things will work out well and we continue when things will fail, and we would just try something else.

Jim Marous: So the big tech firms such as Amazon, Apple, Google, Facebook, have taken their services and are expanding into financial services. Where do you see possibly the whole opportunity of open banking for a financial institution to expand maybe outside of traditional financial services to other elements of a consumer's life? How do you, how do you see that possibly playing out?

Sophie Heller: Well, I think as I said, I think I mentioned you the example of the transport because transport is a big thing at the moment. And and maybe that can liaise a little bit with also the mission of the group, BMP Paribas, since you met Antoine. As a bank, We really are aiming at having a positive impact on the future, for a better future. And one of our focus is really helping our clients go green. Two days ago I was attending the result of a UX research that we've done with customers. And we see that we have different buckets of customer. But you have some customers that are really ready to give up their car maybe they would like to have a more green mobility, but they don't know exactly how to do. So because we are also having this private colleagues inside the group, Our [inaudible 00:22:09], one of the worldwide leader in a Paris.

Sophie Heller: We are setting up now those offers where you can actually have the comparison of what it costs. What your current car is costing you globally. What would be the cost of moving to an electric car? And because a lot of people are a little bit reluctant to switch completely, we understand that from this research that people want to be able to test that solution. So we are structuring an offer while you can actually test an electric car for a couple of months and then if you like it, you will contract further. So this is one area, a very concrete area, where where the bank is actually expanding beyond. Because it's legitimate because you're still talking about how you optimize your budget, and you facilitate the life of the customer. And that also is in line with our group mission to have the positive impact.

Jim Marous: Well, you know, you mentioned that and one of the things that really impressed me when we visited Paris was your organization's commitment to improving the social elements of things around a consumer. From the going green, as you mentioned to some of the health issues and education issues. And as we said, the access to energy. Can you explain any of the other services that are, the other expansions that you're doing that really help the overall brand but also help the consumer?

Sophie Heller: Yeah, I think we've taken really a radical decision in terms of investment appraisal. So our subsidiary asset management has decided to go 100% for social responsible investment. So I think this is a very strong choice. I am personally 100% convinced that this is a good choice because this is really making an announcement and the politics of the company. very consistent with the reality. So we say, yeah, I want to promote for a better future and I start to change myself. So all my investment, all the investment that I provide to my clients are going to be 100% SRI. This is a very strong decision I think. And it's one example. If we're talking more into the business sector, we've taken very strong commitment. But this is not really retail, it's more on the corporate side. But we want the banks to take the most radical decision, not to finance polluting energy for example.

Sophie Heller: So this is really as a bank, I think we have a role. And people expect us to have a positive contribution to the society. So if you do this how do you help your customer go green. How you favor the financing of green project or green energy rather than polluting energy. And for example, we are also structuring this program for retail clients while we help you go green. So we've identified that the easiest way for a bank to help you go green is to look at your mobility. So this is an example that I was taking with the electric car. But also look at your home. So with your home, what we are looking at is partnering with a specialist company that can make a diagnostic. When you are owning your house, you can have a full diagnostic in terms of energy and then we can come up with the financing and the solutions with the decisions that you need to take to reduce the carbon footprint, or improve the isolation appraisal for your house. So these are very concrete things that help customer, and help society at the moment, at the same time.

Jim Marous: Well, it's funny. As we wrap up this conversation, one of the things that came out of my meeting with you, and I don't know if you know this yet, but I've reached out to your team, and your team's going to help me next year make it so I have a zero carbon footprint for my travels and all that.

Sophie Heller: Yeah, that's fantastic.

Jim Marous: So, I'm working with your team to basically figure out how I can purchase carbon offsets to take advantage of making it so that my extensive flights and a hotel stays and everything else, that we can make it so that I have a zero carbon footprint next year. So you definitely impressed me in that category. So that was exciting.

Sophie Heller: Yeah, absolutely.

Jim Marous: So again, I want to thank you so much for being on the show today. It was great to extend our conversation that we had in Paris. And to dig deeper into some of the issues that it's obvious you have a lot of energy as a leader, and you're making an impact on the organization as a leader that came from another organization that was vastly different. But the impact obviously is being shown in the organization. So again, thank you so much for being on the show today.

Sophie Heller: Thank you so much. It was really nice visiting with you. Thanks Jim.

Jim Marous: Thank you.

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