How Banks Can Compete Using Platform Business Models

In a conversation with the Financial Brand's Jim Marous on the Banking Transformed podcast, author and consultant Ted Moser provides a pragmatic "playbook" for how banks can shift to platform business models, citing strategies used by industry leaders that deliver unique growth opportunities.

Platforms represent the next frontier of strategic competition for banks. Adopting platform business models can unlock unique growth opportunities compared to traditional product-line approaches.

To shed light on this vital strategic shift, The Financial Brand’s Jim Marous spoke with Ted Moser, a senior partner at consulting firm Prophet and author of Winning Through Platforms on the Banking Transformed podcast. With over two decades of experience advising major corporations, Moser helps clients anticipate change, craft growth strategies and realize their ambitions.

Moser specializes in developing successful platform business models, guiding both existing platform companies — and those transforming to become one. He works extensively across industries including technology, medical devices, financial services, media and entertainment.

In addition to authoring “Winning Through Platforms” — one of the first competitive strategy playbooks for the platform era — Moser has developed methodologies for accelerating growth. He holds an MBA from Wharton and runs the consulting arm of the Wharton Small Business Development Center.

In conversation with Marous, Moser shares the insights he’s gleaned from studying industry leaders like Amazon, Uber and Airbnb. He outlines how harnessing these platform strategies from other industries can help banks gain advantages amid massive customer and competitive change.

The Nature of Platforms and Their Strategic Potential

Q: How do platforms enable unique growth opportunities?

Moser: Platforms allow ongoing customer relationships during the use of a product or service, enabled by technology stacks that facilitate visibility into usage data and real-time interactions.

This enables greater relevance, lifetime value growth and loyalty. Financial services have used platforms like online banking — but lack a competitive playbook of strategic moves. Studying companies across industries can provide fresh strategic thinking to gain advantages.

Q: How exactly do platforms drive growth compared to traditional models?

Moser: Traditional business models focus on the point-of-sale transaction and view customers as “going dark” after purchase. In contrast, platforms continue engaging users during product use via data and telemetry. This powers value-added services that enrich the core offering.

Platforms also leverage network effects — as more users join, the experience improves for everyone. If firms can’t provide this level of persistent engagement and service, they’re at a structural disadvantage to competitors that can.

Q: You mention financial services has used some platform capabilities. Can you expand on that?

Moser: Areas like online banking and online investing represent foundational platform applications since they allow digital visibility into usage and ongoing customer interactions. However, these applications are highly regulated, limiting innovation opportunities.

The key is identifying fresh platform strategies financial institutions can layer on top of foundational capabilities to gain competitive advantages. This playbook of moves is what most banks currently lack.

Overcoming Challenges in Adopting Platforms

Q: What challenges do firms face in adopting platform models?

Moser: Aligning internal stakeholder incentives around a shared platform vision. Transitioning from product-line thinking to starting with customer coalition development. Many banks are structured around products, not customer personas and associated ecosystem relationships. Platforms require coordinating strategy across formerly siloed groups.

Q: Can you expand more on difficulties shifting from product-line approaches?

Moser: A lot of talent in firms has built careers through being siloed owners of assets and products. Platforms require shared contributions to a shared asset. This threatens people used to autonomous control and incentives aligned to “their” product line.

Leaders must think through incentive systems and both monetary and non-monetary rewards to motivate platform-friendly behavior. Trying to graft a platform onto a product-line culture will severely limit traction.

Q: Beyond incentives, what other cultural shifts are required?

Moser: The fundamental mindset must move from product-centric to customer-centric. Legacy banks often pay lip service to customer-centricity but continue operating as product-line-focused enterprises. Platforms require rethinking enterprise structure around personas and associated coalitions. This includes mapping desired ecosystem relationships and crafting engagement strategies that transcend organizational boundaries.

Learn more about platform offerings:

Crafting a Platform Playbook

Q: What strategies do successful platforms leverage?

Moser: Broadening the customer vision and base beyond traditional boundaries. Linking the brand to demand through new disciplines like momentum marketing. Adding real-time AI advice and using AR/VR to envision future states. Building customer-centric cultures focused on lifetime value.

Q: Can you provide examples of expanding relevance and scope?

Moser: Uber moved into food delivery, shipping and loyalty programs to enrich their platform coalition beyond just riders and drivers. Airbnb offers local “experiences” when traveling to make the stay more interesting and associate additional positive feelings with AirBnb.

Banks may need peripheral offerings tied to community, thoughts, leadership, or experiences to raise relevance and build a “completely proportioned brand diamond” spanning inspirational, innovative, critical and problem-solving dimensions.

Q: What role does technology like AI and AR/VR play in successful platforms?

Moser: AI adds tremendous opportunity to provide contextualized real-time advice and recommendations by harnessing customer data. Conversational interfaces powered by AI humanize these interactions. AR/VR immerses users in envisioned future scenarios relevant to the brand promise. Overall, emerging technologies enrich platforms’ ability to “be with the customer” and demonstrate intelligence.

Q: How does this playbook drive differentiation and competitive advantage?

Moser: Deploy the right “platform plays” from categories like design, demand, innovation, experience and transformation. Like a sports playbook, choose the right move for the situation to outmaneuver competitors. Expand scope of relevance to customers’ lives. Continually monitor performance and adjust approaches based on real-world feedback.

Making the Strategic Shift

Q: What should banks do first when considering platforms?

Moser: Learn the platform playbook — since most are trained in product-line thinking. Embrace customer-centricity, data transparency and adapting incentives and culture. Mindset shift is required before overlaying platforms on product-line approaches.

Q: Can you expand on the critical importance of embracing customer data?

Moser: Customers will share data if they believe it drives mutual gain — convenience, personalization, cost savings, etc. But they remain wary of exploitation. Banks may suffer from the perception their interests aren’t fully aligned with consumers. Adopting clear data governance, ethics and transparency is essential to build trust in platform initiatives.

Q: How can banks instill the necessary mindset shifts?

Moser: Progress starts from the top with leadership instilling a customer-first vision. Employees need empowerment through tools, training and authority to resolve issues “in the moment” as they arise. Consciously connecting metrics across functions also unifies the focus on delivering frictionless customer experiences.

Q: How can banks build the relevance to spur loyalty?

Moser: Look beyond financial services at peripherals tied to prosperity and community. Combine digital capabilities with human relationships. Banks score high on pragmatic problem solving but lower on critical, inspiring and innovative brand dimensions. Expanding relevance is key.

Advisory services on gaining wealth and career advancement. These are tools to build prosperity, not just manage money. Community hubs around financial best practices. Original thought leadership content on life strategy, not just finance. The key is identifying adjacent spaces clearly linked to customers’ financial lives and aspirations.

Dig deeper: Gen Z Will Get Its Money Advice from TikTok. Should Banks Jump In?

Leveraging Platforms in Financial Services

Q: You mentioned financial services have used some platform capabilities. Can you expand on how platforms are applied in this industry?

Moser: Platforms enable ongoing digital relationships during product use across many financial services — online banking, online investing, insurance telematics, etc. However, the highly-regulated nature limits innovation opportunities compared to less restricted industries. The key is identifying fresh platform strategies financial institutions can layer atop foundational regulated capabilities to gain competitive advantage.

For example, in wealth management, platforms allow advisors to monitor portfolios and offer AI-driven guidance for better returns. In banking, data-driven personalized recommendations can anticipate customer needs. In insurance, usage-based policies with real-time feedback help improve driving habits. The principles are similar across domains — even if competitive moves must adapt to regulatory guardrails.

Q: Where do you see the biggest platform opportunities right now for established banks?

Moser: I think the proliferation of financial technology companies presents an enormous platform opportunity. Banks possess advantages in credibility, trust and customer intimacy.

Fintechs bring innovation around customer experience and technical capabilities. Banks that effectively integrate fintechs into open banking ecosystems can combine strengths to unlock far more value than either can deliver independently.

But the bank must become a seamless orchestrator across internal groups and external partners. This requires both a platform vision and seamless data sharing underpinned by API infrastructure. The bank’s role evolves from direct product provider to platform facilitator. This transition enables capturing more customer lifetime value.

Competing in a Platform Economy

Q: In the book, you stress the importance of learning the platform “playbook” for competitive advantage. What does this mean?

Moser: The platforms playbook involves studying winning strategies used by leading platform companies then translating these into a catalogue of potential moves. Like a sports team, banks need to master the full playbook then deploy the right plays for each competitive situation. This provides a strategic shorthand for executives to quickly recognize opportunities and respond using proven platform techniques.

For instance, we highlight demand generation plays like “Brands Get Brains” – leveraging AI to demonstrate value during the customer journey. Or experience plays like “Momentum Marketing” — creating feedback loops to continually accelerate user engagement versus linear funnels. The playbook provides a toolkit to outmaneuver competitors through superior platform strategies tailored to each market context.

Q: What role does technology like AI and AR play in successful platform strategies?

Moser: Emerging technologies exponentially expand possibilities for creative platform plays by opening new channels to engage users with contextual intelligence. Conversational AI humanizes interactions while personalizing recommendations leveraging data and machine learning. AR immerses customers in vivid experiences envisioning the future platform-empowered states.

Technology both enables uniquely platform-oriented advantages like perpetual customer engagement and provides means to execute ambitious plays. But tech remains the means, not the end.

Technology roadmaps must serve the customer-driven platform vision. The playbook focuses on harnessing technology’s potential to differentiate and compete as platform transformation accelerates across industries.

Q: As we conclude, what are the key takeaways for banks looking to harness platforms for competitive advantage?

Moser: I would emphasize three key takeaways:

First, embrace a customer-centric mindset focused on expanding relevance across the entire journey, not just transactions. Look beyond core products to peripheral services that enrich the experience.

Second, study the platform playbook and deploy the right plays suited to your strengths and market situation. Master these competitive moves through practice, analysis and adjustment.

Finally, enable the transition through leadership vision, aligned incentives, empowered staff and a commitment to data transparency. Build trust by clearly demonstrating how platforms create mutual value for customers and the institution.

Q: What advice would you give bank executives just starting to explore platforms and will be reading your book?

Moser: Approach platform strategies with an open, growth mindset. There are likely untapped opportunities you may currently dismiss due to ingrained assumptions. Think creatively about how pillars like customer coalitions, experience expansion and strategic marketing plays could apply in banking. Don’t let preconceptions constrain exploration.

Also, recognize platforms require long-term commitment. Treat initial applications as foundational steps on a multi-year journey defined by continuous testing and learning. Maintain agility to quickly adapt but stay resolute on the ultimate vision — become an indispensable platform in customers’ financial lives far beyond transactions.

For a longer version of this conversation, listen to “Platform Strategies Fuel Innovation and Growth in Banking”, an episode of the Banking Transformed podcast with Jim Marous, available here or wherever you get your podcasts. This Q&A has been edited and condensed for clarity.

Justin Estes is an award-winning writer, strategist, and financial marketing expert with expertise in banking, investments, and fintech. His clients include the NYSE, Franklin Templeton, Credit Karma, Citi and, UBS, and his work has appeared in Forbes, Barrons and ThinkAdvisor as well as The Financial Brand.

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