This time it’s personal …
Everywhere we look there’s evidence to show the financial services market undergoing a revolution.
Advances in fintech, growing dissatisfaction with traditional financial institutions and the rise of the ubiquitous smart phone have laid the groundwork for a deluge of new brands.
Tandem, Atom, Mondo, Secco, Fidor and Lintel are not the names of some of the lesser known Lord of the Rings characters but some of the new banks that are going to be vying for your attention in the coming year. The money transfer space is another sector about to face a big push from new brands such as World Remit and Revolut with more to come.
With this eagerness to engage new audiences, how will they avoid the pitfalls of financial marketing of the past? How do we stop the black horses and pinstripe brigade but also avoid being too folksy or looking like a Boden catalogue? I want some sobriety from my bank but I also want to learn how they can really improve my life.
People will be reluctant to change banks but can be eager to embrace new technologies in this space. You can see how consumers adapt to new financial tech when it’s simple and makes their life easier. I still find contactless payment a joy and its integration into the London public transport ecosystem is incredible. Every time I tap my card jumping on a bus or tube, it’s genuinely making my life easier – and public transport more accessible. In a similar way, Apple Pay is growing in popularity too. When improvements just work, they’re great. With this in mind, there’s a great opportunity for the new money transfer services here to cash in on. However, the new challenger banks are going to struggle.
How often do you see your mates on Twitter talking about their brand new bank account? Or asking for the best rates on a loan over a Facebook status? Talk of changing bank accounts is just a massive turn off. Instead, the challenge for new banks lies in the fight to shape the wider conversation around making life easier and better. We only have to look to energy suppliers to see how difficult it is to excite people around utilities and finance. The lack of differentiation from the newcomers has meant that the big suppliers still supply more than 90 per cent of households. There has been a small increase in the number of people changing supplier in the last year but still nothing like the millions expected to make the leap.
These new financial institutions, and the rapidly evolving incumbents, need an audience-first understanding of the marketplace and to adjust their marketing plans accordingly. Learning from how the energy companies have failed to engage their potential audience would be a good place to start. As well as this, they should also look towards how brands like Uber and Apple are changing how we engage with new models and allow us to spend our money in a seamless manner, making us eager to split with our cold hard cash.
Be aware also that the incumbent banks are doing a much better job and they already have our business (and are regaining our trust). Just visit your local bank branch and it’s evident. For instance, my local Barclays couldn’t be more helpful to save me money when I visited them recently. In fact, one staff member noted how they’d been modeled on Apple stores. They quickly cancelled some old bank services I’d signed up for, saving me time and money. Of course, I shouldn’t have been mis-sold in the first place, but they are learning and changing.
With the financial services market in a state of flux, now is the time to create some form of disruption. Not for their own benefit, but for their audience’s. That will create a true point of difference and help them own the conversation.