As I research this industry, I have come to realize that these companies are out to change the traditional and incumbent products and services (i.e., investment advice, portfolio management, trading, payments, currency exchange, lending, etc.), which are offered by today’s financial firms. But, as obvious as this goal may be to most, what’s less obvious about FinTech companies is the by-product of all of their new and different products and services: the customer experience. Maybe other business professionals don’t see it the same way I do; but as I read one website after another, one piece of marketing collateral after another and one article after another, etc., it seems as though what these upstart FinTech companies really want to do is disrupt, alter and improve the overall customer experience.
Sure, traditional and incumbent financial companies may want to provide an exceptional and satisfying customer experience as well, but their wanting to do this is somewhat limited by the legacy systems, processes, policies and products/services that are currently in place and which would need to be changed (think ocean-going super tanker, which is slow and hard to change direction). With these new FinTech companies, however, I get the sense that it’s quite the opposite. Because they are being built from the ground up in a very customer-centric manner, their customers’ experience is, by default, the focal point and primary concern of their business.
Here are a few examples:
Powa Technologies, a UK-based FinTech, offers mobile payment technology for both online and in-person, brick-and-motor payments. The company’s main product, PowaTag, is a QR code platform which offers some interesting features and benefits. As you read through the company’s literature and third-party articles, you realize that the company is not out to reinvent the QR code, but that they are striving to use this technology to change how consumers research, shop and purchase products. It’s the experience, not the product (or platform).
CurrencyCloud, another UK-based FinTech, offers currency exchange and global payment services. Here too, in reading about the company, you get the sense that the company is not out to change the way currency is exchanged and/or global payments are transacted, it’s more than that; the company wants to change the consumers’ currency exchange and global payments experiences.
TraxPay, a Germany-based FinTech, is focused on enabling a complete end-to-end solution for B2B financial transactions. B2B financial transactions happen many millions of times daily (nothing new there) but, as the company’s CMO mentioned to me, it’s the financial transaction experience that TraxPay is out to improve and make different.
While many may see the customer experience as a mere by-product of a company’s product or service, it is nevertheless a distinct aspect of business, and a component of the marketing mix, of which a company needs to be aware and think about. And, this is especially true in today’s marketplace, where so many financial (and other) products can be viewed as commodities. Let’s face it, how different are the wealth management services from one private bank to another? How different is one small cap equity fund from another? How different is one mobile banking app from another? The answer is very little, at best. But the one variable which can really set these companies and their underlying products and services apart (i.e., de-commoditize, differentiate) is the customer experience that they can deliver along with the product/service itself.
Whether they intend it or not, in my opinion, this is why the new breed of FinTech companies will keep the traditional and incumbent financial companies on their toes, and why they will continue to draw investment funding and marketing professionals’ attention. Including mine.