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Disrupting the disrupters…

Wander Bruijel 31 May 2019

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Open banking is slowly but surely achieving its aim of making the financial services market more competitive.

High street banks are actively improving their digital capabilities while a slew of challengers – names like Monzo, Atom, N26, Bunq and Lemonade – emerge to provide more choice.

Evidence of the high stakes at play can be seen in the news of 10,000 people changing from old-school banks to brands like Monzo and Starling, even as their established rivals offer huge incentives to sign up. Throw in recent coverage of issues like branch closures and Which? campaigning to “save cash” and the radical impact that a new generation of Generation Z customers is having and it’s safe to say that the banking and payments category – widely perceived as low-interest in previous decades – is becoming very active indeed.

Banks used to convey their credentials through sturdy architecture and branding that borrowed heavily from heraldry – anything to convey longevity and stability. As Chad West, Chief Marketing Officer at fintech company Revolut says: “Banks love that consumers don’t understand what they do. But instead of standing miles away, they should be standing right here holding their consumers’ hands when it comes to decision making.”

Today branch visits are few and far between for many of us, while fears about the safety of our savings are mitigated to a large degree by government regulation. Throw in lingering anger over the 2008 banking crisis and subsequent economic downturn and banks are being forced to rethink how they come across to people.

Cue friendly branding and reassuring words about getting your finances sorted, as well as promises of better smartphone apps and easier ways of managing money.

The problem is that many startups are already ahead of traditional banks with their technology. They’ve got the benefit of starting out without the burden of legacy. While established brands congratulate themselves on making simple balance checks possible, the innovators offer features to help with budgeting, saving and even invoicing for small businesses – all from a single smartphone app.

At the same time these challenger banks are able to say something authentically new and have the freedom to be more playful and disruptive than established banks. It’s harder to change when you need to appeal to new customers at the same time as trying to explain to your loyal, long-term account holders the benefits of sorting your finances online, rather than with a person of flesh and blood.

Customer service is no longer a differentiator. It’s a hygiene factor. Today, good customer service is an app that always works and never requires you to do the unthinkable, i.e. talk to someone over the phone.

So how can established banks come back and disrupt the disruptors?

The reality is that many of these disruptor banks are still very transaction driven… moving money from one place to another, but with some added insights and functionality. However, big legacy banks offer financial support across the lifecycle of the customer. They’re there when you get your first pay-check, when you buy your first car, your first house, when you send your kids to university, when you retire and so on. That’s a huge advantage. Bearing this in mind, big banks can start to disrupt the disrupters by:

  1. focusing on being truly personal, relevant and mobile first
  2. going beyond the obvious of providing transactional insights and gimmicky features
  3. making complex financial products simple
  4. and truly empowering their consumers

Banks that will do this well will go back to the core of their brand and brand values and redefine themselves from that point. It requires that banks apply design-thinking to put their customers truly at the heart of the banking experience. And it means that marketing and innovation teams need to work together to fuse the brand and customer experience authentically with innovation. As we say it at Elmwood: They need to play nicely in the sandpit.

Want to have a chat with us, drop us your details:

    Wander Bruijel Wander Bruijel
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    Further reading

    Why today’s brands must strive for iconicity.

    Helvetica has been revamped for the digital age, in recognition of the fact that changing times demand distinctive brand design, writes Andrew Lawrence, our executive creative director.

    Cannes 2019: We need to bring humanity back into the heart of design

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