Insights 8 June 2021

Financial Products for Younger People Must Be Personalized and Joyful

Today the quickness of everything shortens consumers’ interest and focus. Therefore, an important task of all business organizations is to keep customers with them for as long as they can. The task is more challenging for banks and financial institutions because they must make complicated financial products interesting and easily accessible.

It comes as no surprise that personalized financial products have mushroomed particularly to attract customers. They include Personal Financial Management (PFM) and Robo-advisor, the financial instruments that select the products that suit individual customers, especially those of Gen Z. The BAI Banking Outlook: Trends In 2020 research found that 64% of respondents valued Personalized Banking Experience particularly when it came from recommendations on the financial products that match their spending habits and lifestyles. Besides, consumers of the new era tend to leave a bank or financial institution that cannot offer personalized experiences.

Apart from impressive experiences for customers, what is necessary for businesses to keep people with them for good is to create connectivity. This means stimulating participation and making customers feel that products are part of their life and are the platforms that can connect them to their friends and acquaintances. This makes financial matters joyful and existing customers will be willing to persuade others to also use such favorite products.

Fun first, then understanding

The development of a product needs not only the 2 elements namely “usability” which refers to, for example, user experiences and user interfaces and “usefulness” for users based on product information and recommendations, but also “connectivity” which is an important factor to create the uniqueness that leave competitors behind.

From its first-hand experiences, Bluebik, which has been advising large business organizations on the application of innovations and technologies for strategies and management and helping them set their financial goals, has found that “connectivity” can be created through the “gamification” technique which refers to the inclusion of quizzes in platforms. It is similar to personality tests to identify the financial personas or spending habits of customers who can be roughly divided into three groups – shoppers, investors and savers.

The presentation of financial personas not only make people feel that financial matters are there in their everyday life and easily accessible but also lead to the development of other kinds of content that customers can share with friends or acquaintances via social media. They can share their financial goals or saving accomplishments. When customers share the information, the pictures of their lifestyles and nature become clearer. The groups of customers are showing what are their interests and goals. This will result in the creation of the personalized products that better impress customers by, for example, providing them with the exact information that they need and recommending better products for them.

Gamification creates interesting reliability

Surely gamification is a tool that creates the senses of participation among users. Fun is included to prevent users from being bored and make them feel that they are playing games. Financial products can use various forms of gamification instead of being confined to a single form. Different forms of gamification can be combined to create a diversity of methods to present knowledge, understanding and the reliability of financial products in simplified versions.

Money management apps can be designed to begin with quizzes to acquire the basic information of customers including their age, education, careers, interests and lifestyles. Then they can pose questions about spending habits and financial goals to gain deeper knowledge about customers’ demand. All the information will show individuals’ financial personas.

 A quiz to find financial personas should consist of 3 main elements.

1. Financial Risk

This is to assess the degree of financial risks that each customer can take. The degrees range from low to low/medium, medium/high, high and very high.

2. Financial Decision

It can be a prompt decision of, for example, a customer who wants a product and buys it right away. Or it can be a prudent decision of a customer who ponders over a product before buying it.

3. Financial Management

Financial management is also necessary. It can be divided broadly into short-term financial plans for implementation within 1 year, medium-term plans for implementation in 3-7 years and long-term plans for implementation in 7 years or more.

Apart from being applied to design quizzes, gamification can also include the incentives that encourage users to do some activities on platforms. For example, users are asked to set the goals of their savings in 1, 3 or 5 years and plan the use of the savings. The users who complete the steps will receive badges, medals or scores which they can use to claim prizes. This lets users enjoy games and returns the favor to users by offering them privileges.

In the new world where consumers have considerable and various choices, the developers of complicated financial products must not only try to persuade customers with outstanding applications and users’ benefits but also consider customers’ feelings to prevent them from looking to competitors. This can be achieved with the organized strategies that will lead to the design of the best and most impressive online experiences for customers.