- October 29, 2018
- Posted by: Mary Ellen Georgas-Tellefesn
- Category: Marketing
With the renewed focus on revamping product lines, we are seeing four trends emerge in banking product design:
- Simplification – Consumers have sent a clear message that they want a product set and user experience (UX) that is intuitive, fast and easy. They have been trained by Apple, Google and the rest of Silicon Valley. Most banks have not reached that pinnacle of ease of use—and if you aren’t approaching it, you risk losing customers. To encourage ease of use, banks should offer a small number of products in any one category that are distinctive and easy to understand. Banks should also simplify the new account opening process, the way the product works, how customers interface with the product digitally, and how clients resolve product-related problems.
- Value-added features – The truth is that most consumers don’t buy “bank products” but rather a tool to do a job. For instance, they buy a mortgage in order to purchase a house, or open a checking account to manage their daily financial transactions. This, combined with the fact that most banks’ products are pretty similar, drives the need for banks to provide “value-added features” like rewards programs, dedicated bankers, or money management assistance to add unique value to clients and differentiate their offerings. The possibilities are endless but must be informed by insight into consumer hot buttons and pain points.
- Bundled value proposition packages – Many banks have had success in combining several products (checking, savings and mortgage) and bundling them with unique value-added features tailored to the needs of specific customer groups. The features are usually based on research regarding a customer segment’s unmet financial or nonfinancial needs. Bundles are great for relationship up-sell and deepening as bundles give consumers more reasons and rewards to consolidate their relationships.
- Expanded competitive set – Banks that are winning through product design often take cues from financial institutions all over the country (and the world) and also pay attention to nonbank competitors like Quicken, Acorns, Mint, Venmo, and OnDeck to garner fresh ideas. Looking at local competitors is helpful but more insight into innovative client-driven solutions is often found looking at fintechs and larger institutions.