Onboarding – open data use cases
In this edition of open data use cases, we look at the value of being able to supply a streamlined onboarding experience — by powering the platform or service in question with rich, consented customer data feeds. The value broadly falls under two buckets: accelerating the customer’s time-to-value and minimizing the risk that a business takes on.
What is the role of onboarding experiences?
An onboarding experience serves two primary goals:
- Accelerate the time-to-value for the customer (the time it takes from when a customer purchases a product or service, to when they start deriving value).
- Minimize the risk businesses face when setting up new customers.
Qualification of potential customers is an integral part of daily operations for most businesses, especially those playing in the B2B space. In its simplest form, running a thriving business is all about how well customers can be acquired and retained. Let’s break down the business’ go-to-market plan into the acquisition and retention phases. Onboarding experiences help increase the velocity of a customer’s acquisition — and therefore aids in reducing the risk of churn a business faces. The faster a customer is convinced that the product or service is right for them, and the smoother the set-up is, the less likely they are to look elsewhere.
How does open data enable onboarding experiences?
The business environment is more competitive than ever. Growth and expansion are prized almost above everything, accelerating the speed at which customer experiences value is more critical than ever. A well-executed onboarding experience is a key driver for businesses to achieve this. Feeding rich customer data into onboarding experiences gives businesses the capability to deliver a more personalized, service-centered experience – which is often the fastest way to demonstrate value to the customer. By adopting this approach, business minimize the risk they face as they provide a fuller and more 3-dimensional picture of their services — enabling their customers to onboard faster and make data-driven decisions with greater ease. This is particularly important for a business’ tactics in retaining customers they have, empowering users to derive greater value from the product or service.
Open banking and finance datasets power onboarding in financial services
There is inherent complexity with the procurement of financial products and services — given the dizzying amount of regulation and risks associated with normal business operations e.g., fraud, risk-exposure, ethical considerations, etc. Open data (or in this case open banking and finance) datasets that feed into onboarding experiences appears to be the ideal solution.
The primary benefit of open data is to accelerate the time-to-decision for an application for a financial product. Irrespective of what the financial product is, there is an expected customer qualification period required prior to a loan’s approval. The application process for financial products is the perfect vehicle to connect a customer’s datasets to — accelerating and streamlining the experience significantly.
For example, if a small business applies for a term loan at a lender, they’ll need to provide financial (and perhaps other) datasets depending on what inputs the lender uses in their risk models. Open data enables the loan applicant to connect their business’ bank account, accounting software, POS system, and other systems in the finance stack, used natively as part of the application process. Powered by open data feeds, it’s a seamless experience. Consider the alternative, where the applicant needs to export the same information from each system and then email them through to the lender. Since the data is permissioned to the lender in a digital format, it removes the need for manual intervention and allows for a faster, automated decisioning process.
Customer experience is what will win the market
According to Aggregation Theory (Thompson, 2015), those that can provide the best user experience will ultimately win the hearts and minds (and most importantly wallet share) of customers in the digital age. The open data phenomenon we are seeing evolving is another example of the commoditization of data Thompson refers too. Having access to specific datasets will cease to be a competitive advantage when your competitors gain consented access to always-on consumer data feeds via an API.
Thompson, Ben. (2015). https://stratechery.com/2015/aggregation-theory/
As infrastructure for open data develops and matures, permissioned customer data that feeds into onboarding processes will be considered table –stakes in the competitive lending market. 10 years from now, it’s not difficult to imagine that customers would instantly cross a service provider off their shortlist if the onboarding process takes longer than 5 minutes – something that can only be achieved with integrations that support connections to open datasets.
Thompson, Ben. (2015). Aggregation Theory. Stratechery. https://stratechery.com/2015/aggregation-theory/