Experiential competition refers to the reality that customers compare experiences across industries rather than limiting comparisons to direct competitors. A customer who enjoys a seamless food delivery app, ride-sharing platform, or ecommerce experience begins to expect the same convenience and efficiency from banks, insurance providers, and healthcare organizations.This shift has fundamentally changed the competitive landscape. Businesses can no longer focus solely on outperforming organizations within their own sector. Instead, they must meet or exceed customer expectations established by the best digital experiences available anywhere. Organizations that fail to recognize this change risk appearing outdated and difficult to use, regardless of how they compare within their traditional industry.
Experiential Competition: When Is a Bank Not a Bank?
Hannah shares two very different experiential journeys upon misplacing her bank cards.
Question: Who are your competitors?
Many of us would answer instinctively with a shortlist of companies within our industry who sell products or services comparable to our own.
But 2019 is a different world. I can order ramen with just series of taps on my phone. Much in the same way, I can hail a taxi to whisk me out of the rain with a series of taps. As technology advances, user expectations have become ‘liquid’, seeping from one industry to another. If I select, order, and pay for food and transport in this way, then why can’t everything be this convenient and fast?
Just as customer expectations have become ‘liquid’, so too have the competition that we measure ourselves against - a bank is now very often not just a bank – as competition broadens beyond direct competitors to experiential competitors. Take Deliveroo, clearly, they’re not a bank, but my experience of their service still tacitly contributes to the expectations I have when it comes to other services. Simply put, businesses can no longer afford to think within the parameters of their industry alone.
Take my recent millennial emergency, for example.
I have two bank cards: one ‘traditional’ bank card (A), my main account which I use for bills and essentials, and one ‘challenger’ bank card (B) for everyday spending - eating out, commuting, overpriced artisanal coffee and suchlike. Whilst I use B more, the former serves as my main account; it’s what I know, it’s a typical, established bank.
That was until on a Thursday evening in Covent Garden, where I misplaced both bank cards. Despairing on the way home, I embarked on two very different experiential journeys:
Journey 1:
Thursday 12am: My anxiety builds over thoughts of card A being used to buy endless rounds of G&Ts in Covent Garden.
The next day
Friday 10am: I’m searching online for the bank’s lost cards helpline. I engage with 10-minutes of automated voice recordings and number pressing. Gaze out of the window to strange maraca holding music. Eventually get put through to a well-mannered call agent, before recounting all my bank details over the phone. The agent confirms that a new card will be sent to my local London branch for collection the following week.
The next week
Wednesday: Still waiting for my new bank card…
Friday: My new bank card turns up at my home address…in the Channel Islands.
Tuesday: New bank card arrives in London. Hurrah! Now to change all those direct debits…
Journey 2
Thursday 12am: I open my mobile app for card B and tap the freeze button – my card is instantly frozen.
12:01am: I tap ‘request new card’, tap again to confirm my address. The app confirms that a new card will be dispatched the following day.
Saturday 9am: New card received through the letterbox.
In the same way that I order an emergency taxi, a series of taps resolved the panic and emergency of losing access to my money. I knew where and when card B would arrive, receiving it in record time.
Bank B didn’t ‘think’ like a bank. It responded to my needs in that critical moment, in line with the experience that I am accustomed to in a frictionless economy. Banks could do well to think less like a ‘bank’ or retailer and more like an emergency service; if we need to contact them, then it’s safe to assume that something has gone wrong. When that happens, we need to trust that we’re in swift and steady hands. We need to know what’s going to happen and when, receiving answers before asking the questions.
Summing up
By focusing only on direct competitors, businesses risk their customer experience failing. As customer expectations transfer from one industry to another, so must the mindset that businesses adopt to design their services. The benchmark of success is no longer set by an industry standard, but by the end user themselves.
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Bank Customer Experience - FAQs
Modern technology has dramatically increased customer expectations. Consumers now expect services to be available instantly, accessible from mobile devices, and capable of resolving problems with minimal effort. Experiences that once seemed exceptional have become baseline expectations. The article describes these as "liquid expectations" because they move freely between industries. If customers can book transport, track deliveries, and resolve issues with a few taps on their phones, they naturally expect similar convenience when managing finances or interacting with other service providers. Organizations must therefore design experiences that align with broader digital trends rather than relying on industry norms.
Challenger banks have built their services around customer convenience rather than legacy operational processes. Mobile applications allow users to instantly freeze cards, request replacements, receive updates, and manage accounts without lengthy calls or branch visits. These features address customer needs quickly and transparently. Traditional banks often require customers to navigate multiple channels, wait on hold, and follow complex processes to accomplish similar tasks. As a result, challenger banks frequently create experiences that feel more responsive and customer-focused. This demonstrates how innovation in experience design can create competitive advantages even when products and services appear similar on the surface.
Businesses should broaden their view of competition beyond companies offering similar products or services. The real competitors are often the organizations setting new standards for convenience, simplicity, and customer satisfaction across industries. To identify experiential competitors, organizations should analyze the experiences customers encounter in their daily lives and understand which interactions shape expectations. By studying these experiences and learning from outside industries, businesses can discover new opportunities to improve customer journeys and differentiate themselves in meaningful ways.
A frictionless experience minimizes effort, reduces uncertainty, and helps customers achieve their goals quickly. Businesses achieve this by simplifying processes, anticipating customer questions, providing clear communication, and removing unnecessary barriers throughout the journey. Customers particularly value frictionless experiences during moments of stress or urgency, such as losing a bank card or resolving a service issue. Organizations that respond swiftly, provide transparency, and empower customers to solve problems independently often generate higher levels of trust and satisfaction. These experiences become powerful differentiators in competitive markets.
Organizations must view customer experience as a strategic business asset rather than a support function. Every interaction should be designed to reduce friction, increase confidence, and deliver value quickly. This often requires organizations to challenge legacy processes and redesign services from the customer's perspective. Businesses that consistently prioritize customer needs can create stronger loyalty, improve retention, and build positive brand perceptions. As experiential competition continues to grow, organizations that invest in understanding customer expectations and delivering exceptional experiences will be best positioned for long-term success.