HSBC, one of the world’s largest banking and financial services organizations, has been exploring platform-based strategies as a way to stay competitive in the rapidly evolving digital landscape. This approach is in contrast to the traditional product-based approach that banks have relied on for decades. In this article, we will explore the differences between these two approaches and why HSBC is betting on platforms to drive growth.
Product-Based Approach
The product-based approach is a traditional way of doing business in the banking industry. It involves creating and selling individual products such as loans, credit cards, and savings accounts. Banks have been using this approach for decades, and it has been successful in generating revenue and profits. However, with the rise of digital technology and changing customer expectations, this approach is becoming less effective.
One of the main drawbacks of the product-based approach is that it is transactional. Customers interact with the bank only when they need a specific product or service. This means that banks have limited opportunities to build long-term relationships with their customers. Additionally, customers are increasingly looking for personalized experiences and solutions that meet their unique needs. The product-based approach does not allow for this level of customization.
Platform-Based Approach
The platform-based approach is a newer way of doing business that has emerged in response to the changing digital landscape. It involves creating a digital platform that connects customers with a range of products and services. The platform acts as a marketplace where customers can find solutions that meet their specific needs. This approach allows banks to build long-term relationships with their customers by providing personalized experiences and solutions.
HSBC’s Exploration of Platform-Based Strategies
HSBC has been exploring platform-based strategies as a way to stay competitive in the digital age. The bank has launched several digital platforms, including HSBCnet, which is a platform for corporate clients, and HSBC Wealth Connect, which is a platform for wealth management clients. These platforms allow customers to access a range of products and services in one place, making it easier for them to manage their finances.
HSBC’s platform-based approach is driven by a focus on customer experience. The bank recognizes that customers are looking for personalized solutions that meet their unique needs. By creating platforms that connect customers with a range of products and services, HSBC is able to provide a more personalized experience. Additionally, the platform-based approach allows HSBC to build long-term relationships with its customers by providing ongoing support and solutions.
Conclusion
HSBC’s exploration of platform-based strategies is a reflection of the changing digital landscape and the evolving needs of customers. The traditional product-based approach is becoming less effective, and banks need to adapt to stay competitive. By creating digital platforms that connect customers with a range of products and services, HSBC is able to provide a more personalized experience and build long-term relationships with its customers. As the banking industry continues to evolve, it will be interesting to see how other banks adopt platform-based strategies to stay competitive.
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- Source: https://zephyrnet.com/hsbc-experiments-with-platforms-versus-products/