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by Sanjib Kalita, Editor-in-Chief, Money20/20
Industry View from
We are in the midst of seismic societal changes to how people interact and transact. Across societies, geographies and segments, digital is the new norm. Change has accelerated, placing greater value upon flexibility and speed. Historically, money and finance have been among the more conservative, slower-changing parts of society, but this has shifted over the past decade, and money is now seen as an instigator of change rather than a lagging indicator.
Whether you are a marketer in shining armor conquering new territory, a financial wizard casting spells upon the balance sheet, or the queen or king guiding the whole enterprise, it’s imperative you keep these four trends about money in mind.
Platforms are the base upon which other structures can be built. For example, app stores from Apple and Google provide the infrastructure for consumers to complete commercial transactions and manage finances through their mobile phones. While these companies develop their own digital wallets, they also enable similar services from banks, retailers and other companies. Building and maintaining the platform enables services that they would not have created on their own, such as Uber or Lyft, which in turn have created their own platforms.
Marketers trying to address customers’ needs can plug into platforms to broaden offerings or deepen engagement with target markets. Platform-based thinking implies that product and service design is ongoing and doesn’t stop with a product launch. Jack Dorsey didn’t stop when he built the Square credit card reader. He went into lending with Square Capital and then consumer P2P payments with Square Cash. Square’s ecosystem has grown through partnerships as well as through in-house development.
How do your customers interact with you? Do they need to create a username and password, or can they use a third party system such as Google or Facebook? Are security services like two-factor authentication or biometrics used to protect credentials? Is your company protecting customer identities adequately? These questions are increasingly important and often the difference between being forced into early retirement by a massive data breach or surviving to continue to grow your business.
While identity management and digital security might not be at the top of the minds of most marketers, they are table stakes for even the most basic future business. History is full of tales of rulers successfully fighting off armies laying sieges to fortresses, only to fail when another army gets access to a key to the back door.
Credit card transactions have moved from predominantly being in-store, to taking place on e-commerce sites accessed from desktop computers, and now to mobile phones. As the point-of-purchase has expanded, so have the consumer use-cases and thought processes. In tandem, mobile screens presents less information than desktop computer screens, which in turn presents less information than associates in a brick-and-mortar environment. Companies best able to understand context and deliver the right user experience within these constraints will build loyal customer relationships.
Apps or services created for a different use cases on the same platform, such as Facebook and messenger apps, can help achieve this. Banks and have different apps for managing accounts or for completing transactions. On a desktop, you can access these services through a single interface, but on mobile, forcing users to select their use case helps present a streamlined experience on the smaller, more time-constrained mobile screen. The use of additional data such as location, device and so on can further streamline the experience. Marketers that don’t think about the context will lose the battle before it even begins.
While a marketer’s goal is to generate sales, data has become a value-driver. In the financial world, data about payments, assets and liabilities has become critical in how services are delivered. PayPal, a fintech that’s been around since before the term was coined, has recently been using payments data from its platform to help build a lending business. Similarly, Kabbage, an SME lender, has grown to unicorn status by using data from other sources to make smarter lending and pricing decisions. In the payments industry, Stripe distilled a previously complex technology integration into a minimal dataset, accessed via API, to easily build payments into new digital products and services.
Marketers that can harness the power of data will be able to predict what customers want and more effectively address their needs. In some cases, it might be using data for targeting, pricing or servicing decisions, or in other cases, it might be using data to reimagine what your product or service is.
Money20/20 USA will provide further insights into the future of money and the role these trends will play, with practical takeaways to keep your business at the forefront of the industry.
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