Fintechs Don’t Have a Lock on Creative Mindset
September 26, 2019
Alternative financial providers continue to make inroads with creative solutions and non-traditional marketing efforts. Although some Fintechs may never make a profit and ultimately fade away, they are still permanently changing the competitive landscape.
It seems Fintechs recognize that many consumers live in a “gig economy” and shy away from longer-term commitments; this recognition creates opportunity.
When approaching new opportunities, it can sometimes be easier to start with a clean slate; which in this case requires mindset and imagination. Fintechs are not restricted by legacy business practices, marketing efforts, and technology, allowing them more creative freedom.
But Fintechs don’t have a lock on creative mindsets, and senior leadership teams of financial institutions are beginning to take bold actions to shake up the mindsets of their organizations.
Many financial institutions have overhauled their infrastructure. Perhaps they implemented a new core, a mobile solution, or online banking system.
We’ve spent time with multiple financial institutions that have undergone this mindset change. Here are a few observations to share from our experience of helping senior leaders reimagine the infrastructure of their organization.
- They require robust consumer study. This does not have to be a daunting undertaking. It is relatively easy and fun to scan other sectors and new startups to see what is on the horizon; taking what is seen and asking a series of questions. For example:
- What need is this startup trying to meet and why?
- How would our target markets clearly benefit from having this need met?
- If we only spend time and not money, how could we use our current technology to launch a product/service that addresses this need?
- What scale would we need if we assumed this product/service is a standalone, meaning we are not counting on cross-sales of other products and services?
Of course, there are many more questions to be answered, but often, answering these questions only requires a little repackaging and a shift in marketing messages.
- They allocate time to think strategically. Senior leaders are required to think strategically as individuals and bring ideas to the table. Also, they schedule big blocks of time at least quarterly to think collectively and debate various ideas and emerging trends. This type of meeting is focused on “what could be” and not wrought with what can’t happen.
- One of the biggest roadblocks we see is that many institutions don’t fully leverage automated decisioning. It’s essential to get to the root of why systems, that were expensive, are not leveraged effectively. Once that is uncovered, a huge key to success is diligently focusing on getting the necessary mindset change. There are key components to getting and sustaining mindset shifts.
- They know that marketing is not just the next campaign. In this digital world, marketing needs to be at the strategic level. Strategic marketers need to thoroughly understand the business model. Once they do this they can become partners in creative repackaging of offerings. They take the time to struggle with answers to tough questions such as:
- How do we attract quality customers in a digital world?
- How do we sell in a digital world?
- How do we not waste a marketing message? The consumer is busy; we can’t over message.
- They have direct conversations and debate. In other words, they don’t live in an echo chamber. Senior leaders push on questions like:
- How are we addressing consumers’ desires for microloans and/or short-term commitments?
- Do microloans fit our business model? If not, should they?
- How have we changed our underwriting standards to take into account new consumer behavior, like the gig economy, social media, and employment trends?
- They truly put themselves in a busy person’s world by asking questions such as:
- We live in a one-minute world, so why do we require our customers and employees to do so much work?
- Why do we think a telephone onboarding process is what the consumers want when we, ourselves, don’t want to answer the phone?
- Why can’t we give our customers immediate answers? If we can’t, then can we remove the uncertainty and give them constant updates on where they are in the process? Domino’s can, why can’t we?
- Why do we say 24/7 but we don’t put people support behind the 24/7?
Now is the time for bold thinking. As your institution develops its budgets or strategic plans, make sure people are challenging themselves. Consumer expectations are changing fast. Developing creative solutions for members will require non-traditional thinking and will become increasingly necessary to make sure your institution can remain relevant.