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Playing to customers’ emotions in financial services

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Today, people are more likely to get their banking done on the subway or while waiting in line at the grocery store than at a physical bank branch. The same goes for previously onerous tasks like applying for a personal or home equity loan or the granddaddy of all financial products: the mortgage.

In fact, some customer relationships can happen almost entirely using mobile technology, with nary a phone call or face-to-face meeting to be had. This approach to online banking is great for convenience, but may not do much to promote a deeper understanding of the customer.

Given the competitive landscape in their industry and a plethora of available options, the smart fintech and financial services companies are working overtime to generate the requisite level of trust among their customers. That means working across channels, and even offline.

By providing greater value, a simpler customer experience and continuous innovation, the best financial services companies transcend trust and build a true emotional connection with their customers. Here’s how.

Pioneers of fintech customer service

Although well-known fintech brands like SoFi, Credit Karma and Acorns have very different client propositions, they have one common denominator, says Duena Blomstrom, a speaker, author and the creator of Emotional Banking, a proprietary method aimed at making retail banking more customer-centric. “They built propositions that are firmly planted in clear client needs and have presented them through best-of-class experiences.”

Credit Karma acquired customers — and endeared themselves to many of them — by offering free credit reports. At the time, many credit reporting agencies were wedded to more traditional business models, i.e. charging for even the simplest service. Credit Karma’s approach was rewarded by establishing a greater sense of trust, which enabled it to launch and sell new products. Most recently, it debuted an auto insurance service that crunches government, credit bureau and public insurance rate data to help customers find the cheapest policy.

Quicken Loans’ Rocket Mortgage did something similar for mortgages, helping customers compare rates in minutes, rather than days. And the company bolsters its service orientation with on-the-ground support for families facing foreclosure.

These solutions aren’t particularly high-tech, but they make a difference to customers and are relatively easy to do, says Blomstrom. “Non-transformative as they may be, ease-of-use and clear access to information along with better communication cannot be underestimated in this day and age when incumbent banks still have difficulty offering these basics.”

Emotional connection baked into the fintech value prop

A new fintech app called U-Nest has built emotion into its fundamental value proposition and target market. It’s an app designed to help parents save for their children’s education by simplifying and automating access to tax-advantaged 529 college savings accounts.

U-Nest founder Ksenia Yudina is a certified financial analyst who had three kids and earned an MBA by the time she was 30. She’d also racked up $180,000 in debt, a crippling feeling she wanted to help her children avoid. As she walked her wealthy clients through the process of opening 529 accounts for their children, Yudina thought: “What if I could use my financial tools, experience, resources and background to help parents of all backgrounds, and not just the wealthy few?”

And so she created U-Nest. Where once it took hours of extensive research and access to an expensive financial advisor to find and register for the right 529, parents can now register for U-Nest in five minutes.

Yudina and team are betting that emotional connections between parents and their children, an easy process and a simple fee structure will help U-Nest achieve the same trusted relationship with customers that fintech predecessors like Acorns enjoy.

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Omnichannel made easy: Implementation checklist for finance and fintech companies

Download an easy-to-follow checklist created by Everest Group, in partnership with TELUS International, to help financial services and fintech firms acquire and retain customers while managing a true omnichannel strategy.

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Using consistent communication to build connections

SoFi popularized student-loan debt consolidation and used heavy offline techniques, including very traditional-looking mailers, to connect with debt-ridden Millennial customers. Though it now rakes in over $500 million in annual revenue and is eyeing an IPO, SoFi’s brand remains synonymous with Millennial-friendly products.

SoFi’s connection was built around helping customers pay off debt while at the same time achieving big life goals like getting a mortgage or saving for a large purchase.

To build on that brand equity, and to develop a more consistent emotional connection to customers, the company launched SoFi Money, a “high-interest deposit account” that allows users to make payments, deposit checks, transfer funds, get a debit card and even gain access to complimentary career coaching and community resources. SoFi is betting that building a consistent rapport and creating an emotionally-invested relationship will drive repeat business.

Though the company has a slightly different target customer, Acorns’ approach to personalization is similar. Like SoFi, Acorns also recently launched a debit card and a checking account product. The card Acorns offers is designed by San Francisco-based design firm Ammunition and is made of arare metal called tungsten(not a piece of plastic) as a method of reminding users to take good care of their money.

Unlike other checking accounts, Acorns’ checking account is designed to help its customers save, so it rounds up every purchase and deposits the difference into an investment account. More than 150,000 people have signed up to pre-order the card.

Acorns also has an affiliate program called “Found Money,” where brands like Airbnb, Jet and others offer discounts to Acorns users, which are also automatically invested in their accounts.

Acorns is focused on what CEO, Noah Kerner, calls the “up and coming” which consists mostly of young investors who are early in their careers and eager to start saving for their futures. Through personal finance content site GROW, Acorns works to educate that group of consumers on issues that affect them, without giving them a hard sell on the brand. And it’s working. The four-year-old company has more than 3.5 million users.

Through its consistent communication, innovative product launches and an ongoing commitment to serve the best interests of its young investors, Acorns’ customer set tends to be very emotionally connected to the brand. After all, for many, it’s the company that enabled them to start investing without high fees and that slowly educated them on important topics in financial literacy.

Results of emotional connections in financial services

Companies like Acorns, SoFi, U-Nest and others offer strong examples not only for how to build emotional connections with customers in financial services. They also demonstrate the power of taking a decidedly customer-centric approach to their business.

From product design, to education, to marketing and advertising, customer service and support, there are huge opportunities for brands to focus on customer needs. The companies that have taken this approach are demonstrating consistent and authentic dedication to their customers and are pushing ahead of the competition.

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