25 Mar 2019

Why Doesn’t Barclays Have a Grocery Store?

Tesco has a bank, Sainsbury’s has a bank… so why doesn’t Barclays have a grocery store?

The question is tongue-in-cheek, but it raises a few points about digital platforms in general that are worth considering.

  • The first point is that digital platforms built for one purpose can often be leveraged to cover other purposes. For example a retailer like Tesco with an extensive online retail shopfront may find that it already has much of the infrastructure it needs to reach customers for their financial products – such as current accounts or insurance policies.
  • Secondly, if one set of products (such as financial products) are tailored to suit the same customer demographic as another set of products (in the retail shopfront), customers of the platform get access to products which are uniquely suited to them, all in one place. So a retailer is likely to increase it’s customer footprint my offering complimentary and suitable products – so it’s a win-win.
  • Thirdly, as cash and cards give way to digital wallets on our phones, the virtualization of money is almost complete. As notes, coins, cheques and cards are no longer needed, many divergent companies can sell their wares online, perhaps even on the same platform.

Traditional banks, hamstrung by legacy infrastructures and conservative cultures, may struggle to deliver that digital experience. Tech businesses, fintechs and challenger banks seem to be ahead of the curve because they approached the opportunity from the other direction, building agility and innovation into their technology and culture from the beginning.

The competition for the hearts, minds (and wallets!) of customers is hotting up: The traditional banks aim to maximise all their established market clout vs. the digital disrupters taking advantage of having digital principles baked into their foundation. In fact Apple has just announced their new Apple Card – in partnership with Goldman Sachs. The traditional banks and newcomers both have certain advantages, but the game is not yet over.  And it is likely that new and different players will appear and create even more novel and exciting services and offerings.

As the world of APIs, API management and digital transformation continue to revolutionise our lives, we’re looking at where the technology is going and watching the market with great interest. We’re excited to be working with our customers to help them derive maximum value from their legacy systems, and then partner with them to build their digital capability to respond to future scenarios. Our expertise can help organisations bridge the gap between the traditional and challenger / digital approaches.

Interested in learning more? Find out our thoughts on APIs and digital transformation by joining an event or watching an on-demand webinar.