By Paul English, Partner, Prophet
As a FinTech, you want to be disruptive. All of your focus will most likely go into the big idea, the business model and the product user experience. But you’d be wrong.
Our research shows there’s more to it than that. The key enabler to success in FinTech is far simpler, and yet so few pay attention to it. It’s not about disruption for the sake of disruption, but about relevant disruption.
Disruption that actually makes a substantial change to customer’s lives, by making things easier, faster and more meaningful. It’s not about the tech or the widget, the app or the interface, but about how it addresses a real and important customer need in a new and improved way.
Think of taxis, for example. The success of Uber doesn’t stem from the fact that its technology made hailing a taxi much easier – Hailo, Gett and MyTaxi all do that, but none of them has had the same impact as Uber. No, Uber’s success comes from the fact that it’s put more cars on the road, thereby increasing the supply of taxis when you need one. It’s not about the tech or the app (although they help!), but about meeting a real and important customer need: when I want a taxi, I want it now, and I want it to come to me.
To be relevant, you must bring customer needs to the forefront of the way you work. Build up pin-sharp propositions, and create experiences that people love so much they want to make them part of their daily lives. Relevance is the extent to which a brand makes a difference in consumers’ lives. And our research has uncovered that the most relevant brands grow at twice the pace of other brands.
To most, this won’t be a big surprise. Indeed, when we asked senior executives from across the FinTech world, everyone agreed that customer obsession was critical. But what is a surprise, is that despite this, they still aren’t investing enough in the customer. Simply put, – only a handful actually put their money where their mouth is. FinTech leaders do know what they should be doing, but rarely do it.
They key findings from our research are:
In FinTech, no amount of innovation can act as a substitute for customer obsession
FinTech leaders say that they believe in putting the customer above everything else. They understand how valuable brand building, consumer insight and user experience are, rating them as more important than conventional start-up behaviours like fast product iteration and investor attraction. But just stating this isn’t enough – you need to act on this.
Yet FinTech leaders themselves say their current behaviour doesn’t reflect the customer priority
Whilst FinTechs know how important customer obsession and pragmatic execution are, there is a marked tendency to shift attention to important and immediate start up concerns. As a result, they can lose focus on the customer, or indulge in practices like feature loading to attract investors rather than invest greater time in more rigorous, customer-based reliability and use testing.
Pragmatic execution is key to success
The principle of perpetual beta may work for a public search engine, but it’s not appropriate where people or businesses are expected to put their financial health at risk. FinTechs have much less latitude for functional or service-related problems than other start-ups do. Customers need to be able to trust that the product, service and brand is there for them from the first public iteration, and in each and every one after that.
Relevant FinTechs beat the odds of success
The most successful FinTechs are the ones consumers turn to, by default, to meet an important need every day. In other words, they are the most relevant to the customer. In-depth interviews with successful FinTech leaders revealed cultures and practices that push aside these typical start-up pre-occupations, in favour of focussing on activities that build relevance.
Download the full version of the report by entering their data. http://www2.prophet.com/how-to-succeed-in-fintech