ブックメーカー凱旋門 in the Digital Age and Extreme Customer-Centricity - Akio Isowa of SMBC Talks with Yasufumi Fujii of beBit

I use the SMBC app quite frequently. Were you involved ブックメーカー凱旋門 developing the SMBC Direct internet banking service?

I was. I worked on the legal aspects of the development of the SMBC Direct internet banking service launched by SMBC in the late 1990s. Then, in 2015, we established the Retail Marketing Department and Retail ブックメーカー凱旋門 Strategy Department, and I went back to working in retail. When I did, I was surprised that the usability of SMBC Direct had not changed at all since the 1990s. In 2015, smartphones were already widespread and the use rate of SMBC Direct on smartphones had nearly exceeded the use rate on computers. ブックメーカー凱旋門 companies at the time were launching apps at lightning speed—the age of apps was here no matter how you looked at ブックメーカー凱旋門.

SMBC Direct was an app, but the design was rather old, and the UX had not significantly changed since I was involved over ten years before. I knew ブックメーカー凱旋門 couldn’t keep going like this, so I decided to bring the app up to date in one fell swoop by eliminating the PIN card and switching from a desktop browser-based screen to a mobile app-based screen.

Users at the time accessed SMBC Direct for about an average of three times per month, but we want them to use ブックメーカー凱旋門 daily. In order to turn ブックメーカー凱旋門 into a service that users would want to use every day, we would need to focus on the design, and to do that we would need a team that could fix things the instant they noticed a problem without delay. At the time, there were no designers at the bank, so we recruited web designers and established an in-house team.

2015 was pretty early to move design ブックメーカー凱旋門-house. That’s earlier than other industry sectors.

Right. At the time, there were a lot of web designers in the job market, so we decided to create a new position and hired some designers. We also brought in full-time coding engineers and built a system enabling quick responses if we needed to change something. To improve the UI and UX, we created a room to test usability and had people review its usability before releasing ブックメーカー凱旋門. The production team wasn’t used to being reviewed, so that was really hard for them. [laughs]

As a UX specialist, to me, ブックメーカー凱旋門’s unthinkable to not get reviewed. In fact, I’m like, “Yes!” when something that needs improvement is found.

Exactly. We also made ブックメーカー凱旋門 possible for people to open ordinary savings accounts in the app. To me ブックメーカー凱旋門 was crazy that you had to go to a branch and fill out a paper form. At the time, the use rate was only 2–3%, even though we did our best to promote ブックメーカー凱旋門 on TV commercials and such, but today the use rate is 40–50%. But no one praises me for being the person who made ブックメーカー凱旋門 first. [laughs]

You made a pretty bold transformation, but what made you take that approach?

ブックメーカー凱旋門 was leapfrogging* in a sense. I think the reason I took this bold change of course was that I saw that SMBC Direct, which we had put quite a lot into, had not been improved in over ten years and ブックメーカー凱旋門 made me keenly aware of how much we lagged behind.

That’s interesting. Most who can undertake bold initiatives tend to be people who have experience working internationally or were hand-picked. Maybe the fact that you were not always in retail and experienced how interesting ブックメーカー凱旋門 is to make websites in the early days of the internet had a big impact on you.

The number of SMBC Direct users had remained at about 3 million for a long time, but when we changed the design to support smartphones, eliminated the complicated PIN card, and implemented biometric authentication, the number grew to 4 million in no time.

When this happened, ideas started coming in from different departments. ブックメーカー凱旋門 was like a tiny snowball started rolling on its own and grew bigger and bigger. Bankers are better at making an existing service bigger and bigger than starting from scratch. Ideas keep coming and coming once a basic framework is in place. What was really groundbreaking was that we eliminated the use of paper forms at branches for wire transfers. Once I went into a branch to make a wire transfer and was surprised that there were no wire transfer forms. [laughs] When I asked a teller, they directed me to SMBC Direct. Before I knew ブックメーカー凱旋門, the app had replaced the bank counter.

The app and bank counter work well together, don’t they? In the last few years, I’ve been using SMBC Direct often, too. I can find the service I’m looking for quickly, and ブックメーカー凱旋門 has such a simple layout that I was surprised at how many functions ブックメーカー凱旋門 has. I think the service shows an outstanding balance of UX, business, and technology. UX tends to be overlooked when compared to cutting-edge technologies like AI, but an outstanding UX enables people to use technology naturally. That’s where I think its innovation lies.

Changing customer touchpoints so they won’t have to go to the bank in 2015 was pretty pioneering. Most companies in Japan didn’t realize the importance of digital touchpoints until 2019 or 2020. In the US, digital advertising costs exceeded traditional advertising costs in 2019. Then the COVID-19 pandemic made ブックメーカー凱旋門 difficult for people to go out, so online touchpoints came to be emphasized even more. Many realized that new customer touchpoints were needed when smartphones emerged, but not many were able to invest in ブックメーカー凱旋門. You made the big decision to do that in 2015, and ブックメーカー凱旋門 is great you have been able to continue this usability-focused service that can solve customers’ problems to this day.

In 2018, I became General Manager of the Transaction Business Planning Department in the Transaction Business Division, where I was in charge of corporate payments. There, I felt that the bank lacked the services ブックメーカー凱旋門 could provide in the area of BtoBtoC.

At the time, retail, eating out, and other industries already offered apps to retain customers, but none of them had a payment function. The reason was that credit card processing fees for merchants are fairly high, making ブックメーカー凱旋門 hard to turn a profit. So, we created Bank Pay using the existing functions of J-Debit*.

That’s great. From a brand perspective,bringing customer touchpoints in-house as much as possible is important. However, when in a partnership, you have to think about profit, but there are also difficulties that come with collaborating with another company. Having a service where you can easily add functions to your app yourself while maintaining profit is really sought after. But ブックメーカー凱旋門 is usually startups that think up services like these, so ブックメーカー凱旋門’s impressive that a big company like yours did ブックメーカー凱旋門.

Now, initiatives like ours have spread to other banks. But even if users use another service, we receive a fee as long as they pay from a SMBC account. If the market gets big, people will switch from cash to cashless payment and the profits will be distributed to the banking sector. So other banks launching similar services is a great development for us.

I think that is what digital technology is all about. If you make an amazing digital service, you can be on top for an instant, but ブックメーカー凱旋門’s pretty difficult to maintain that position forever. However, I think a system where everyone wins will spread easier and last a long time.

ブックメーカー凱旋門’s important to have a mindset that “everyone wins.” As online and offline worlds merge, the number of stakeholders will increase even further. Until now, the main ones were companies and consumers, but implementing services like Bank Pay will involve everyone from SMEs to shopping districts, landowners, and local governments. Those who don’t develop a vision that is best for everyone will be left behind when the online and offline worlds merge.

The next thing I was involved in was the COTRA service. J-Debit is a function for withdrawing money from your bank account, and one day a subordinate of mine at the time told me that we may be able tosend money with ブックメーカー凱旋門 by entering negative amounts. So from there, I came up with the idea of COTRA, a service that lets individuals send up to 100,000 yen to others at no charge. Of course, there were some people at SMBC who were vehemently against ブックメーカー凱旋門. We receive a fee when people make wire transfers via SMBC Direct, which alone comes to several hundred million yen per year. They were against not getting that profit anymore, but after doing some research, I found that the overall cost of managing cash for SMBC was estimated to be over tens of billion yen per year.

If more people switched to cashless, ブックメーカー凱旋門 would reduce the cost of transporting cash and paying security companies, so we would easily be able to make a few hundred million. Plus, ブックメーカー凱旋門 would increase customer convenience. I also want to link ブックメーカー凱旋門 with a QR code payment service. Digital payment of salaries will probably be implemented soon, so if we don’t make bank accounts more convenient, we will lose users.

I use the term “UX competition,” but striving for a good UX and making things convenient for people is a given, and we also need to make ブックメーカー凱旋門 advantageous for us. Earlier, you mentioned that you can reduce the expenses paid to security companies, but according to conventional logic, people tend to think that digital service only takes place digitally without the involvement of people. To me thinking about the involvement of people is a more suitable logic for the digital age. In reality ブックメーカー凱旋門’s really hard though. [laughs]

Earlier, you mentioned usability tests. When I conduct tests, I sometimes learn the perspective of people I’ve never met and don’t even understand. Now the “mass” approach has begun to collapse. When you have the perspectives of people far away from you, you can have a market size as large as the number of those perspectives, and you will be able to see the market to reach those people as well.

That’s really true. To me, terms like “customer-centric” and “customer-oriented” are sophistry. [laughs] For example, there is no way that all attorneys and doctors who are considered professionals have the same needs. A doctor with a private practice that has been passed down for generations and a doctor who raised money to open a private practice themselves will have totally different needs. ブックメーカー凱旋門 far, the term “customer-centric” has been used when someone wanted to express in a logical way that they were providing a certain product or service to a certain group.

I can really relate to that. Going forward there will be a switch from “targeting attributes” to “targeting situations.” People don’t want to be understood based just on “attributes,” do they? One person’s needs will change significantly depending on their situation, such as their business, family, and the music they listen to. Understanding the situation and environment a person is in rather than attributes will be the basis for a digital society. The widespread use of smartphones has made ブックメーカー凱旋門 possible to collect data with precise timing that was not possible before, so going forward, changing from attribute-based to situation-based marketing will be key.

So far, the finance industry has done business with asymmetric information, but digitalization makes ブックメーカー凱旋門 possible to connect with every company and individual, and this will gradually reduce asymmetric information. The age of providing personalized solutions to customers is imminent. Products targeting everyone will no longer be viable, and ブックメーカー凱旋門 won’t even be necessary to make them. Even if a product only sells a few units in Japan, as long as ブックメーカー凱旋門 has some feature that stands out, there is a chance you’ll be able to sell ブックメーカー凱旋門 by expanding the market worldwide. All customer needs will be treated as data, and accuracy will increase. That will be what “customer-centric” means going forward.