Traditional banks have long been seen as the lumbering dinosaurs of the finance world, unable to react dynamically. Many Millennials and Gen Z were searching for market disruptors that offered secure financial services but delivered on their terms and in a digital first manner.
This groundswell saw the birth of the neobank, a digitally native offering with no bricks and mortar branches, specialising in a concentrated set of products and services. Great you may think. Problem solved. These disruptors have filled a gap in the market and are now serving their customers in a more efficient and digital way than the traditional banks ever could. Wrong! If you are going to disrupt the market then you need to stay in lockstep with the demands of your customers (new and old) through effective Fintech marketing strategies. It could be argued that whilst FinTech’s provided a refreshing pivot away from high street banks, they are now facing the same challenges.
Know your market
Being different was, at first, enough of a USP to attract previously disgruntled customers. However, as more and more FinTech’s entered the market, supercharged with supportive conditions like digitalisation and abundant funding, each needed to carve out their own niche. However, many had misaligned their offering with the needs and wants of their potential customers. Overlay direct and indirect competitors and the piece of the pie that seemed sizeable at first can quickly turn to a pile of crumbs.
Poor user experience
The very premise of a neobank or FinTech is built on the customers digital experience. Deliver a poor UX and the selling point that many customers bought into has eroded and with it their loyalty.
If the digital experience is slow, unreliable, cumbersome or irrelevant then customer will churn.
Evolve or fail
In a continuously changing landscape, FinTech’s need to stay ahead of consumer trends and customer wants in order to stay relevant. For example, Revolut started life focusing on the travel market. Their offer was aimed at customers who wanted to make digital transactions abroad without being stung with commissions or unfavourable exchange rates. Over the years, they have evolved their proposition, adding new services such as crypto trading to keep pace with their users’ news.
Navigating regulations
New rules and compliance obligations like Anti Money Laundering (AML) and Know Your Customer (KYC) can become a burden for agile neobanks. These regulations require large amounts of resource and can impact business models depending on technology and risk profiling. Those that don’t cope with these checks and balances can be impacted by delivering a sub-standard service to their customers.
Safety in numbers
Filling the gaps in products or services through partnerships is one of the ways FinTechs can expand their offer to its customer base without diluting their core business. Partnerships enable users to customise their accounts with a la cart services that are most relevant.
It’s safe to say that the FinTech buyer is more disconcerting than a few years ago. Where slick propositions and digital-first experiences provided a breath of fresh air to a largely siloed and outdated industry, these same gems have lost their luster over time. Expectations have exponentially increased. Service requirements have become more complex and personalised.
Standing out from the crowd in a highly commoditised market is difficult, so to cut through the noise you need a marketing agency that can elevate you above the competition.
The Rubicon Agency has significant experience in the FinTech space – whether the original disruptors or the re-incarnators.
Check out our experience in FinTech.
