The global pandemic has altered the way many companies do business. It was a sharp learning curve, forcing us to sink or swim.
Like many industries, the banking sector wasn’t immune to the tsunami of instability - quite the contrary. Covid-19 was only the start of uncertainty. It may have been the catalyst for rising interest rates, inflation, and political disruption, but what has become unquestionable is the fragility of financial institutions.
So, where does this leave commercial and business banking? To understand the challenges it faces, one needs to identify the threats.
Accelerated digital banking, a surge in cyber hacking, geopolitical threats, and climate change are all disruptive forces that can potentially reshape the sector.
According to The Banking in 2035: global banking survey report, about 76% of banking executives surveyed believed the industry has an obligation to address societal needs and issues, while 82% were of the opinion that financial services organizations can simultaneously better society while pursuing profit.
How do banks go about doing this? By prioritizing client needs without compromising on profit. In this article, we’ll take a look at the future of business banking and how adopting certain business models can help you be at the forefront of future banking trends.
Future Business Models and Competitive Arenas in Business Banking
In the ever-changing business landscape, banking institutions have to fight to stay relevant. According to EIU’s financial outlook 2023 report, fintech and cryptocurrency sellers will find it harder to weather the storm.
Adapting to your new reality isn’t always easy, but adjusting your business model is one way of keeping abreast of the latest developments.
Banks that are open to change can benefit directly from disruptions “by combining their unparalleled domain expertise, reputation, and relationships with innovations in technology and a client-centric approach,” said Dr. Christian Thun while writing for Moody’s Analytics Risk Management: The Decade Ahead.
“Fortunately, the business banking sector has proven its resilience over the past decade by bolstering their capital and liquidity positions, and leaving behind non-core activities and markets,” EIU’s financial outlook 2023 report found.
It also sets up the sector for benefiting from future trends by improving digital services, becoming more financially inclusive, and investing in sustainable banking services.
So, what will business banking look like in the future?
Accenture’s Global Banking Lead Michael Abbott’s predictions could soon become a reality. According to him, business and corporate banks’ innovative products could mirror that of the Amazon Prime model.
Just like mobile platforms, banks will take a dip into the metaverse, which will open a world of possibilities, but Abbott warns this won’t be without risk.
As a way of outperforming their peers, banks must help their clients solve their problems rather than increase their customer base. This taps into the notion of “life centricity”, whereby institutions take a holistic approach to customer wellbeing.
Abbott also believes data should be viewed as a product “that has the potential to transform the foundations of banking.”
The Banking in 2035: global banking survey report mirrored Abbott’s predictions when listing its most important outcomes for banks over the coming decade, with improved cybersecurity and data protection leading the pack with 46%.
The Impact of Data and Money Regulation on Business Banking
Banking regulations are a way of enforcing rules to protect the client, ensure financial stability and prevent financial crime. By design, they ensure sound banking practices.
Who regulates the banking system? In the US, four federal agencies have been tasked with this duty, namely the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Federal Reserve System, and the Consumer Financial Protection Bureau.
Easier access to data has become a building block for successful business practices, and a way of doing this is via application programming interfaces. APIs have been utilized in the banking sector for years, even more so in recent times.
But like other innovations, data sharing raises questions around privacy and regulations in the digital market.
The 2007-2009 financial crisis was a huge eye-opener for banks, prompting governments to install their own initiatives.
OECD cited an example of this with the 2015 EU Payment Services Directive II (PSD2) - a regulation that aims to enhance competition by granting open access to certain types of customer banking data for nonbank licensed providers.
During its research into Digital Disruption in Banking and its Impact on Competition, the NPO mentioned how Japan revised its Banking Act in 2017 to include provisions encouraging banks to open their APIs and facilitating banks’ acquisition of or collaboration with FinTech firms.
Nonetheless, banks can leverage their digital technologies in response to regulatory authorities’ questions by improving both regulation and supervision and, in turn, helping regulators and firms decrease the costs of compliance, OECD recommended.
Implementing Digital Transformation for Business Banking
Customer expectations are growing, and so too should your business if you want to grow with them.
Digital transformation is a given when it comes to business banking. By taking advantage of the huge data pool, businesses can automate processes and reduce costs.
Create high-end software solutions for your company with Intellectsoft
Simple changes such as AI, cloud technology, and automation can help improve services and functionality, resulting in customer loyalty.
Below are the key drivers to consider when going digital:
Customer Needs
Here’s where data aggregation takes the lead. It can be challenging at times, but analyzing it leads to a clearer understanding of who your customer is and your targeted audience.
When segmenting your strategy, consider the following: Which products are generating the most profit? Which of your digital services mostly appeal to your customer? Which new offerings could encourage growth?
The intention here is to offer digital services via targeted marketing.
Cloud-based Systems
Previously, business banking was only sought out by big corporations and brands. It was associated with companies that had clout behind their names. Today, the environment is fast-changing and becoming accessible and inclusionary.
With a complete cloud-based system, banks can close the socio-economic gap by offering full access and functionality to clients, from loan applications to international money transfers.
However, there are setbacks to using this type of technology. Old legacy software systems might not be adaptable to comply with new software. The challenge coming with this is the huge costs involved to ensure a fully integrable system.
Thankfully, there is a workaround - some cloud-based technologies are consumption-based, meaning clients can experiment with them before doing a complete rollout.
Compliance Ready
Regulatory requirements are growing steadily, and to make sure your systems are compliant, you need to keep up-to-date of the latest rules and regulations governing the banking sector.
Dismissing these could lead to costly repercussions, which could easily have been avoided.
Security
In June 2022, Flagstar Bank, one of the USA’s largest financial providers, fell victim to a massive data breach whereby the Social Security numbers of almost 1.5 million customers were leaked.
Initially, the bank failed to disclose how cybercriminals hacked into the system, but investigations showed that the attack may have happened as early as December 2021, highlighting the urgent need for ransomware protection.
The Credit Sussie data leak from February 2022 saw the details of accounts linked to 30 000 of its clients leaked. This resulted in one of the world’s biggest private banks having to do brand damage control after it was discovered some of its clients built their wealth on drug trafficking, money laundering, and corruption.
Building the Future of Banking
Overall, banks should future-proof themselves by investing in products that give them a competitive edge. This doesn’t only apply to business banking; commercial banks are finding themselves in the same boat, jostling for a larger clientele.
Major trends are reshaping the industry, forcing the sector to evolve instead of fighting against the current. The good news is that digital business banking has embraced rapid change, considering the environmental, social, and governance (ESG) concerns the world is currently experiencing.
Australian author James A. Gardner poured his years of experience as a career innovator into his book ‘Innovation and the Future Proof Bank: A Practical Guide to Doing Different Business-as-Usual.’ In it, he discusses in detail how banking institutions can become future-proof by “leveraging the power of the new to establish unexpected revenue lines, or make old ones grow.”
Steps to Success in Digital Business Banking
According to Statista, about 27% of Americans use an online-only bank, and 60% of consumers say they are very interested in using digital banking in the next year.
If your company is not using innovation and the latest technology to snag customers, you’re setting yourself up for failure. How do you go about rewriting your success story?
For starters, by hiring a reliable and professional fintech software development partner, you’re already halfway to reaching your goal.
Intellectsoft is a financial software development company that helps clients accelerate innovation by creating tailor-made software solutions.
Why Choose Intellectsoft?
Specializing in banking and financial institutions, Intellectsoft has a proven track record. Our clients include some of the most prominent brands in the world, including the NHS, Universal, and Jaguar.
Some of the financial software development services we offer are online banking, blockchain and cryptocurrencies, digital wallets, AI and ML, trading and securities, and robotic process automation (RPA).
To Sum Up
One positive that the pandemic produced was the uptake of digital payments. About two-thirds of adults worldwide now make or receive a digital payment, resulting in growing developing economies from 35% in 2014 to 57% in 2021, the World Bank found.
One could look at it as purpose-driven banking, a social responsibility of sorts, which we may add, has been predicted to be another big banking trend in the next decade. Banks that are more engaged with societal issues could have the biggest positive impact.
Microsoft CEO Satya Nadella once said, “Longevity in this business is about being able to reinvent yourself or invent the future.”
It’s fitting words, considering the world is always in flux. Reinvention is the name of the game. Ask yourself, can you afford to be left behind? If the answer is negative, get in touch with us to get the most efficient digital business or commercial banking solution.
The hospitality industry depends a lot on keeping customers happy, but it’s getting harder to attract and keep them. The pandemic hit this industry hard, and now market competition is tougher than ever, with competitive offerings swaying customers. Hospitality businesses are willing to spend big to win customers back. The main questions for many are: how can we stay ahead of the competition, keep our customers, and increase revenue? Keep reading—we’ve got some answers.
Customers today have so many options that getting their attention is a real challenge. It’s not easy to make them choose your business over others. What worked 10 years ago doesn’t work the same way now. Back then, people often chose businesses based on reputation. But with new types of businesses (boutique hotels, craft cafes) popping up or big enterprises getting a new strategy, expectations have changed. The good news is these businesses have shown what works: great customer service. They focus on personalizing the experience, making things easy for customers, offering loyalty programs, and using smart technology.
In this article, we’ll explore these tech strategies and show you how they can help your business grow, and double the revenue. Keep reading to learn more!
The Importance of Customer Satisfaction in the Hospitality Industry
Customer satisfaction, which equals exceptional customer experience, is the backbone of the hospitality industry. It plays a central role in driving revenue and loyalty, as satisfied customers are more likely to return and recommend a hotel, restaurant, or other hospitality business to others. In fact, a study by the Harvard Business Review found that a 1% increase in customer satisfaction can lead to a 0.5% increase in revenue. Moreover, loyal customers are more likely to forgive mistakes and continue doing business with a company, even if they experience a negative encounter.
Let's quickly review the challenges the hospitality industry is facing right now so we can move on to the solutions and our case studies.
Challenges in Hospitality
As businesses navigate the changes in the hospitality industry, there are some key areas where a little improvement can go a long way. From improving customer service to embracing digital transformation and tackling labor shortages, we’ll take a closer look at today’s biggest challenges—and, more importantly, how technology can step in to help. Let’s get started!
Poor Customer Service
Even with strong and high-quality business offerings, poor customer service can drive potential customers and existing customers away. Common issues include:
Long wait times in customer service queues (it is worth remembering that our attention spans 8 seconds, and we live in a very busy world, so quick and efficient responses are more important than ever.)
Poorly trained customer service representatives
Lack of follow-up
Services not being done properly or quickly
Recall issues that require multiple service calls
These problems can frustrate customers. But, at Intellectsoft, we believe that the right approach, combined with technology, can address them effectively.
Digital Transformation Gaps
Approximately 50% of hotels are adopting new technologies, with 43% automating repetitive tasks and 39% upgrading existing systems. Source: workstaff.app
While many businesses are adopting digital solutions, some still struggle with outdated systems and fragmented data. Legacy companies often face chaos when trying to manage their data and create new systems or add features.
Some of the recent examples include clients coming to us to create AI solutions for their services while their data simply was not ready for the advanced tasks. We advise stepping back, communicating with a company objective, and working on keeping the data clean (centralized, structured, and segmented).
When we’re asked to create advanced systems using AI, we always emphasize the importance of organized data. To train AI and build such complicated systems that truly work, you need to start from the very beginning—collecting, storing, centralizing, and organizing it. We encourage our clients to align all departments to work internally on the data so we can create a unified digital system that delivers personalized experiences.
If you’re unsure where to start with your data, we can help. Collecting feedback at various touchpoints along the customer journey is crucial for gaining insights into customer satisfaction and loyalty. Book an IT consultation with us, and our experts will guide you in mapping out a path to get more from your data and build a system that works for your business and team.
Reskilling Staff
The pandemic hit hard in early 2020, especially for the hospitality and travel industries. Even five years later, many businesses are still feeling the impact. Recruiting and retaining skilled staff has become a major challenge post-pandemic.
Reskilling to address technology’s impact is of utmost importance, as about 40% of hotel General Managers place it among their top three workforce challenges.
We strongly believe that adopting the right technology can help. For example, creating an app to train your staff not only saves time but also ensures consistency in learning. AI assistants can also work alongside your team, helping with tasks like recruitment (providing industry insights, crafting emails) and staff training. Imagine having an app dedicated to making your team’s work easier and more efficient!
How Technology Tackles These Challenges and Supports a Customer-Centric Hospitality Culture
Automation, AI, and similar technologies may threaten many. However, the debate about replacing humans isn’t about that—it’s about cooperation and working hand in hand with technology to achieve the highest standards and establish brand-new “golden standards.” Technology is here to assist staff in listening to and collecting customer insights from data.
Let’s review some of our cases to see examples of how technology helps improve customer experience and supports customer service.
Examples of Intellectsoft projects
Property management systems (PMS)
We created a web platform and mobile app that makes managing daily tasks easier and offers extra services to improve residents’ experience. It gives a clear overview of daily activities and helps with managing units and users. Residents can easily book amenities, submit service requests, and report incidents. The platform also includes features for equipment management, key instructions, workflows, and custom permissions. This makes it easier for staff to stay on top of equipment and ensure residents have all the information they need. Plus, tools like announcements, quick votes, a forum, and a community calendar help build a connected and engaged community.
Guest Experience Management App
Our next app helped our client improve their guest experience by replacing printed marketing materials and the need for phone calls with a smart solution. Now, guests can easily order in-room dining, make reservations, and interact with staff— through a simple tablet in their room. The solution includes three parts: a custom in-room tablet with a variety of services, an admin panel for hotel staff and service providers, and a backend system that connects everything together. This approach makes things easier for guests and staff, improving both convenience and efficiency.
Existing Customers First: Building Loyalty with Personalized Touchpoints
Keeping existing customers is not just a strategy; it’s well-known that retaining existing customers is more cost-effective than acquiring new ones. In fact, research shows that it costs five times more to acquire a new customer than to retain an existing one. KPMG named customer retention as the number one revenue driver for the company.
Moreover, a 5% increase in customer retention can lead to a 25% to 95% increase in profits, showing the significant impact loyal customers can have on a business’s bottom line. Retention strategies, like personalized experiences and loyalty programs, can foster long-term relationships and generate recurring revenue, ultimately making them an invaluable part of any business model.
Personalization: How Technology Can Help?
Everyone loves to feel special—it’s part of being human. In hospitality, personalization has evolved from being a luxury to an essential standard. With the right technology to manage your data effectively, you can deliver those “wow” moments that guests won’t forget.
More than half of hotel chains are already using personalization features on their websites, booking platforms, and apps, and another 39% are planning to follow suit soon. They’re tailoring experiences to fit guest preferences perfectly.
Source: Deloitte
How does technology make it happen?
CRM Systems: They help you keep track of guest preferences, booking history, and special requests so you can offer services tailored just for them.
Loyalty Programs: Personalized rewards and offers show your guests that you value them, keeping them coming back for more.
AI Personalization: AI analyzes guest data to predict what they’ll love (from room upgrades to local recommendations) before they even ask.
IoT Gadgets: Smart room features like voice-activated assistants, or temperature controls adjust to your guests’ preferences, making their stay more comfortable.
With tech-powered personalization, you’re building loyalty and maximizing the lifetime value of every customer.
Our Case Study: Smart Hotel Management & Loyalty Program
For one of our clients, we created a smart room solution, complete with a custom IoT system. Guests can use a mobile app to control services, explore amenities, and find resort information-- with a special touch to their suite type. For the client’s entertainment business, we improved their legacy software by running a full IT and code check, fixing issues, and making the system better for customers.
Along with that, we developed a mobile app for the loyalty program, allowing businesses to effortlessly reward their customers and keep them engaged with exclusive benefits.
Our solutions not only helped the client with special experiences for guests; it also improved operations, cutting costs by eliminating inefficiencies. Here's what our experts shared:
"We transitioned away from ESB (Enterprise Service Bus) systems, which previously cost millions, and replaced them with more efficient, self-managed solutions. Similarly, we’ve implemented Device Farms that improved operations and saved resources."
Leveraging Software to Increase Upsell Opportunities
Here are some examples of tech tactics that will help your team sell more and introduce new offerings to existing customers, improve overall efficiency leaving your team grateful:
Dynamic Pricing Algorithms
For finance and marketing teams, manually calculating pricing by segment to introduce your clients can be incredibly challenging. AI-powered tools can strongly optimize these strategies by analyzing your database in detail.
Upselling via Apps
Boosting revenue in the hospitality business often comes down to personalized experiences. Imagine this: a guest books a room, and then your app suggests a spa package or a room upgrade at just the right moment. Later, it nudges them to book a dinner reservation or a guided tour designed to their preferences. With apps offering these personalized recommendations during and after bookings, you’re not just increasing your revenue per guest but also skyrocketing their experience. And you do it in a sustainable way, not by speculating, but by offering what your customers desire based on their previous experiences. It’s a win-win: seamless, helpful, and far from pushy.
Inventory and Resource Management Software
Making every resource count in your hospitality business is key. Inventory and resource management software allows you to effortlessly track everything from linens to room availability, ensuring nothing goes to waste. Having real-time insights to reduce overstock, avoid shortages, and optimize operations assists sustainably keep everything under control and know what you need to focus more. It helps maximize room occupancy by aligning bookings with available resources, ensuring every room and item is used effectively. This approach leads to smarter management, better guest experiences, and a noticeable boost to your bottom line.
Adopting these strategies not only optimizes your operations but also drives business growth. Ready to discover how technology can elevate your goals? We’re here to create a tailored solution for you.
Steps For Implementing a Customer Service Technology Solution
Improving customer service in hospitality doesn’t have to be a daunting task. With the right technology, you can smooth the path of your operations, speed up response times, and elevate the overall guest experience. Here’s where you can make it happen:
1. Understand Your Needs
Start by identifying the challenges your business is facing. Are you struggling to manage high volumes of inquiries, track customer feedback, or personalize the guest experience? Pinpointing your needs will guide you to the best solutions.
2. Pick the Right Tools
Choose technology that aligns with your goals. Look for solutions that are scalable, easy to use, and integrate effortlessly with your current systems. Options like CRM software, live chat tools, or a guest experience app can make a difference.
3. Equip Your Team
Technology is only as effective as the people using it. Train your staff to make the most of the new tools, so they can deliver exceptional service and resolve issues quickly. Confident, well-equipped staff creates happy, loyal customers.
4. Keep Improving
Once implemented, monitor how well the solution works. Are response times improving? Are customers more satisfied? Regular evaluations will help you fine-tune your approach and keep things running harmoniously.
Some Tech Ideas for Hospitality Businesses
CRM Software: Manage customer interactions and preferences.
Guest Experience Apps: Delight guests with personalized experiences right at their fingertips.
Amenity Management Systems: Simplify operations for everything from room service to facility bookings.
Live Chat Tools: Offer instant support and answers.
Social Media Management Tools: Keep customer interactions engaging and organized.
Integrating these strategies will not only improve your customer service but also deliver unforgettable customer satisfaction, loyalty, and, ultimately, your bottom line. Ready to take the next step? Book a consultation with our experts.
Conclusion
To wrap up everything we've discussed, customer satisfaction and experience are at the heart of hospitality. Retaining customers is more than just keeping them around—building strong, long-lasting relationships and consistently meeting their evolving needs. By understanding their pain points and offering personalized solutions, you can inspire loyalty and drive progress. With the right technology and continuous improvement, your business can stay ahead, let go of what no longer serves you, and keep growing.
At Intellectsoft, with over 17 years of experience in software development, our expert team is ready to help. We create everything from mobile apps to full-fledged portals and systems, leveraging the latest technologies like AI, Cloud, and Machine Learning. With deep experience in the hospitality industry, we’re here to craft personalized solutions that bring your business unforgettable customer experience and retain your valuable clients.
Ready to double your revenue and level up your customer retention strategy with personalized technology? Contact our experts, and we look forward to working hand in hand with you to build or revitalize the perfect app or system for you.
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