Janar Weerasingam, Gary Fitzgerald and Paul Greenhalgh
What are the Implications for Financial Services
Firms? For all financial services players—dot-coms as well as the
more traditional "clicks and mortar" firms—digital TV represents yet another
new game. It provides another chance to leap-frog to a market leadership
position or regain lost ground. To capture this opportunity, they will need to
radically rethink their channel, product development and customer relationship
management strategies.
As the digital world materializes, big financial services
firms will need to move quickly to forge deals with broadcasters, cable
operators and electronic program guide developers—all of which are on the look
out for proposals and strategic alliances that will help them capture a
profitable share of interactive TV-based traffic and commerce. To succeed in
the digital medium, financial services companies have three main options:
- Lease a channel from a broadcaster to
provide exclusive branded content (for example, creating the "Company X Finance
Channel" that broadcasts its own branded financial planning, retirement
planning and estate-planning programs)
- Provide exclusive branded content to a
third-party broadcaster channel
- Provide non-exclusive branded content
to multiple broadcasters
The challenge in all these options will be developing
content that is engaging enough to generate successful impulse sales and leads.
It will need to avoid pulling viewers away from their primary objective when
watching TV (that is, entertainment) and take advantage of their relaxed or
"winding down" mood. The key will be to encourage them to "act impulsively"
through powerful sales messages, then capitalize on these leads with a business
model that excels in following-up, delights customers with its service and
tailors solutions to their individual needs.
By moving quickly and locking in lower rates today with
broadcasters and cable operators who are looking for ideas and ways to share
the risk, financial services companies have the potential to achieve attractive
advertising rates, spots and other long-term advantages.
First Mover Advantage will be Enormous
There is a fourth option, of course: adopting a "wait and
see" approach that initially involves no more than integrating an existing Web
site with digital TV. Given the crowded state of the financial services
industry, and the growing sophistication of consumers, such an approach carries
big risks.
Just as in the Internet revolution, those companies that
move early and are able to "get it right" by creating effective long-term
strategies, building the business, customer relationship management and
fulfillment capabilities required in the digital age, and innovating
continuously to stay ahead of the pack will achieve tremendous competitive
advantages. These advantages include the powerful brand franchises they will
build by attracting high customer mind-share, and the ability to tap into the
strong share price premiums they are likely to receive to fund further
innovation and growth.
There are still major uncertainties surrounding digital TV.
How much of a barrier will the high initial cost of an integrated digital
television set be to fast consumer up-take of digital services? How quickly
will consumers become comfortable with buying goods via interactive TV? Most
importantly, can broadcasters and content providers rise to the challenge of
providing innovative programming that is both engaging and entertaining? If
these barriers can be overcome, digital TV fundamentally will redefine how
companies and consumers interact and do business in the future. Just as we have
seen with the Internet revolution, those that move quickly to embrace and
leverage the digital medium, and get it right, will be big winners.
Janar Weerasingam is a senior manager in the Accenture Strategy practice. He is based in Sydney.
Gary Fitzgerald is a partner in the
Accenture Financial Services Industry Segment. He is based in Sydney.
Paul Greenhalghis a partner in the
Accenture Financial Services Industry Segment. He is based in Sydney.
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