POV: You’re planning to create your very own fintech app and have spent hours poring over articles relating to the start-up space. You’re aware that approximately 90% of apps fail (it’s the figure echoed across multiple industry-related blogs, after all) and you’re simply planning the best possible strategy to prevent a failure. But what is the secret recipe to ensuring a successful fintech product? How can you guarantee brand loyalty for an untested (and more than likely, undeveloped) fintech app? Here’s how the Blott Studio team believes you can formulate your fintech product for the win.
To understand the potential of fintech apps, we first recommend taking a glimpse into the social media powerhouse app of the hour: TikTok. As of September of 2021, TikTok reported 1 billion active users – a 45% growth over the previous year. They’ve also claimed titles such as the most downloaded, and most engaging, app. Parent company “by dance”, however, has even bigger plans for their app as they aim to build on the success of TikTok by turning it into a super app. That is an application that offers a range of services and allows integrations for mini-programs with select partners. An evolution such as this would mean a greater chance of success for the new feature programs (due to an already captive audience), as well as limit the user’s desire to use multiple apps rather than simply use the multiple services available on the existing product. By way of example, there have been whisperings that TikTok may be planning to launch a fintech product to their users in the near future.
But how can a social media application, such as TikTok, expand into the fintech space (amongst other potential industries)? It’s quite simple really: the key lies in the formula: CX = ML + UX. TikTok is already in the business of collecting data; they have a plethora of data points available on any given consumer of their product. These data points range from demographics used to maintain a user’s profile through to a user’s interests, which are tracked to recommend content. Now that they have this data, they simply need to employ machine learning to catalogue the information and then connect the organised algorithms to a top-quality user experience. This organised data can now be deployed across a range of products, even to the point of personalisation for each unique consumer. And, as the studies suggest, consumers are more interested in these “super” apps, even in the fintech space! So, let’s delve into the elements of that formula, shall we?
Part 01: Customer Experience
The bottom line in a successful app is customer experience; if consumers don’t have a need for the product, or find the product difficult to use, they’ll either not download the app in the first place or delete the app in frustration. It’s up to your team to balance the technical complexity with its useability; that is, determining the best combination of features to satiate the user while ensuring that navigating and engaging with the app remains easy and rewarding. Customer experience is their impression of every phase of the journey they undertake when purchasing your product. The first thing to consider on your climb to success is the need your fintech product serves consumers. Now, many companies get this wrong, because they tend to focus on which customers fit into their available product portfolio, rather than viewing the needs of the consumer (irrespective of that portfolio). Consumers want to feel valued, and they’re more likely to make use of fintech apps that have taken a beat to listen to their hearts’ desires. Once that need has been determined, you’ll want to turn your attention to the aforementioned formula, which states that customer experience is equal to machine learning plus user experience. Let’s take a look at “the other side” of formulating your fintech product for the win.
Part 02: Machine Learning
Now, we’ve touched on the importance of changing the focus from your product to the consumer’s needs. The idea is that your product should pivot to serving this identified need. The second phase of discovery lies in developing a machine learning algorithm that will analyse and organise the raw data you have access to so that you can step in and evaluate your consumer base with ease. (Think predictive banking analytics and propensity models.) The third, and final phase of discovery, is next-best-action systems. Monique Duquette of SAS Canada defines NBA’s as, “a customer-centric marketing technique that considers the alternative actions during a customer interaction and recommends the best one.” Combining this approach with machine learning algorithms allows you to target unique consumers with personalised offers. It is this level of personalisation that your consumers will appreciate, and that will ultimately turn them into loyal users.
Next-best-action systems are an important part of the algorithms your app employs for the following reasons:
- They analyse individual consumers’ spending and buying behaviour, record location, and even keep track of how this consumer responded to previous campaigns. This information provides you with the opportunity to push personalised offers to individual consumers, which leads to higher conversion probabilities.
- Further to point one, these predictive analysis tools can make recommendations on which products individual consumers will most likely need next. This aids in customer experience.
- These systems also allow for in-depth tracking, so that your team can keep abreast of previous campaigns offered to individual consumers to avoid marketing the same product repeatedly.
Fintech start-ups can maximise the impact of machine learning (and how it influences customer experience) by making use of conversion AI interfaces to summarise those personalisation’s to meet the needs of the individual efficiently.
Part 03: User Experience
It has most recently been purported that millennials are getting better at saving and managing their money habits. In fact, Bank of America suggests that there has been a 16% increase in saving by millennials from 2018 to 2019. They’ve also noted, however, that approximately 75% of millennials in the USA have debt. With these statistics in mind, let’s take a look at the three elements that will assist you in developing a quality, user experience focused, fintech product:
- Educating the user. We’re specifically speaking to intuitive and progressive learning metrics in developing your fintech product. It’s important to aid the user in discovering the abilities of your app, in a way that is easy to follow. Think of creating a funnel that follows the user’s journey from beginner to expert.
- Security. Fintech carries the burden of offering a secure product. There is also a fine balance between ensuring that consumers can use your app safely and making sure that the security of said app is sufficient to protect that user, without creating frustration for that user. Consumers need to be able to trust that their information and finances are protected while having relatively easy access to manage their app. Biometrics and two-factor authentication are great security tools that can be used at different levels of the app.
- Authorisation. Just as you wish to create a smooth, secure experience for your existing users, so too should the onboarding process of new users be relatively easy. Authorising new accounts is the first glimpse users have at understanding the intricacies of your fintech product and, if the process is over-complicated, they’ll more likely be scared off. Consider keeping the process simple for access to the basic features of your product; additional security measures can always be utilised for features of a more sensitive nature.
- Friction. Points two and three discuss security systems for your app and, while your aim should be to offer a smooth user experience, you also want to ensure that mistakes are non-existent. This is where the term “friction” comes in. In essence, friction refers to protecting the user from making mistakes and will involve pop-up confirmations, two-factor authentication, and review steps to avoid users accidentally sending their earnings to the wrong place and the like.
- Display. Finances are stressful, and a large majority of mobile app users don’t have degrees in financial services or related fields. So, keep the front-end of your app easy to navigate and understand. For example, if your fintech app helps users track their spending, ensure that the key indicators are displayed at a glance. Navigation to in-depth metrics can always be included, but could overwhelm the average user and should thus be incorporated as a separate dashboard. The interface should be seamless and effortless.
Bringing the Parts Together to Create the “Whole”
As you work on your fintech product, keep the formula CX = ML + UX, in mind. While it presents as a three-part formula, there are actually six layers to those three parts that need to be considered to take your app to the next level. Raw data and analytics work hand-in-hand as the first two layers. They involve collecting and organising consumer data to understand the individual and prepare the most successful strategy to deploy for each. This is then where marketing operations take place, as the marketing function makes use of the analytical information to target individual consumers with a personalised experience. On acceptance of this personalised offer, the user is then digitally onboarded. The fifth layer is interaction and involves input from your analytical layer that monitors the individual so that you can set push notifications that are of value to that specific user. The final layer is that of customer service. This function involves resources available to the user, a potential chatbot for self-help, as well as your support team.
This modus operandi is the blueprint for formulating your fintech product for the win. A quality customer experience is what sets Fintech apart from traditional banks and employing the elements of machine learning and an excellent user experience is what will get you there. The key lies in maintaining an intuitive product that is perceived as simple in the eye of the consumer, irrespective of how many features your fintech product expands on to include. If your users feel valued, and believe that their app is personalised to their needs, your product will remain their primary financial product.
Loved this blog? Read next: Top Tips for a Market-Ready Fintech Product
Ready to bring your fintech product to fruition? Schedule a chat with the Blott Studio team.