Over the last couple of years, the number of fintech companies has grown exponentially. The user base has been growing steadily too. For instance, compared to 2018, 2019 saw a 71% increase in user registrations. Large fintech companies saw a 20% increase in monthly average users.
The finance world was already witnessing changes due to increased digitization when the pandemic accelerated this further. During 2020, the average number of sessions on investment apps grew by 88%, whereas the number increased by 49% on payment apps. Similarly, banking apps saw a 26% growth.
The entire industry is now operating under new rules. Therefore, marketing strategies for fintech should change too. Let us look at the new trends that have emerged recently and how to leverage them in your fintech marketing strategy.
1. Explore new opportunities
The pandemic has forced people to change their habits and switch to online and contactless payments. However, in the emerging markets, informal workers who struggle to put food on the table often do not have access to digital payments. The fintech industry may help close this gap. They can offer basic financial services to the unbanked while expanding their user base in the process.
For example, MOVii is a digital wallet service based in Colombia that enables contactless payments. At present, the app is working to disburse government funds to the people. People are using the same app to purchase items or pay their bills. Similarly, Current is a banking app that targets freelancers and gig economy workers. These are the people overlooked by traditional banks and are also hit the hardest by the pandemic. Fintech can make a difference in this area by marketing its products to those who need them in such trying times.
2. Make your processes customer friendly
One of the drawbacks of traditional banks is their cumbersome processes. Even simple tasks like opening an account or getting a small loan take a lot of paperwork. Often it also requires you to visit the bank branch. Fintech companies can provide the same services as a traditional bank but without all the friction. Fintech companies are much more flexible and customer-centric when compared to banks. Marketing how your company is better than a bank is a great way to get new users and retain old ones.
For example, Thimble, an insurance service provider, found that people were lapsing on their insurance payments. So, they offered users to pause payments for their insurance instead of canceling it straightaway. They also allowed users to resume the premium payment at the old rate. Again, since the brand targets small business owners, it was helpful for people suffering from the pandemic.
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3. Provide faster access
The business model of fintech companies is not as rigid as that of traditional banks. They do not have minimum balance requirements; they offer complete banking services without overdraft fees and do not have direct deposit requirements. With these new fintech start-ups, customers can access financial services much faster. For example, Thimble allows users to get insurance after users complete a 60-second sign-up process. Most wallets and payment banks in India pride themselves on being easily accessible, with faster sign-ups, easy deposits, and high interest rates. These are the features that customers seek nowadays, and therefore, Fintech companies should highlight these USPs in their marketing messages.
4. Be empathetic
Empathy is a key element that most companies miss out on when marketing their products. Traditional banks are decades old. Most baby boomers or Generation X have seen these banks emerge and grow as they grew up. But the financial requirements now are vastly different from that era. Most traditional banks and their policies do not reflect the needs of millennials or Gen Z. They need to understand the financial situation of their current customers and then market their products accordingly. However, rigid policies and regulatory requirements often do not allow them to do so.
By being more flexible in their operations, fintech companies can better understand and adapt to user requirements. For example, PerkFianance is building a financial solution purely for the blue-collar workforce. Machine Learning and AI-based solutions are allowing fintech companies to understand the financial situation of their users. With this information, they can personalize their products accordingly.
5. Retain users with great UX
UX or the user experience of a product refers to the user’s interactions with a brand’s app or website. User experience is a part of CX or customer experience, which includes both physical and digital interactions. With Fintech companies, physical interactions are nearly absent. However, a great way to sell your products is by providing a decent user experience. Also, when it comes to finances, people seek security. Fintech apps can market themselves as a secure and familiar platform that users can trust. For this, apps should be easily accessible and provide users with a holistic view of their finances.
A notable change that almost all fintech platforms have adopted is a fully digital KYC system. With state-of-the-art software and widely available internet connectivity, users can now send all necessary documents over the internet and digitally sign the required paperwork.
6. Increase focus on mobile
Fintech companies have made their products surrounding the internet and cloud services. One can access all the services right from a web browser. However, for a product to work, the focus should be on mobile. US consumers spend about 5 hours a day on mobile devices. Smartphones have become cheaper, and cellular internet is available nearly everywhere. Therefore, building a website that works great on mobile should be a priority. Having a dedicated app is even better. Apps can exploit device-specific capabilities to make the experience much more secure, fluent, and user-friendly.
A mobile-friendly website also helps in SEO (Search Engine Optimization). But having an app is compulsory for a service to succeed. Fintech apps and websites should be clean, free of ads, and should provide a familiar user interface. The user interface makes up a crucial part of the user experience, and therefore, you should not ignore it.
7. Make the most out of social media platforms
Social media is not only a great marketing platform but is also a suitable channel for customer support. Almost all internet users have an account on one or more social media platforms. Social media platforms allow you to target your audience more effectively and optimize your campaigns. You can personalize your marketing campaigns for different demographics and improve customer engagement. If you see, social media is also a great way to share existing blogs, FAQs, how-to videos, and more. It will not only market your product but will also show how effortless it is to use them.
8. Produce valuable content
When your product is good, it will market itself. But for that extra push, you will need valuable content. The content includes blog posts, white paper, product demos, and more. You can also use videos to engage audiences. Not only will the product-related content help you with customer support, but it can also act as marketing collateral. Furthermore, providing potential users with finance-related knowledge will help establish the brand’s authority. It will also improve the success rates of your marketing campaigns.
9. Opt for paid ad campaigns
For marketing a financial service, define a target audience and create a marketing campaign strategy accordingly. It will be way more effective than buying space on billboards or time on television. Think about it. You are promoting a digital financial service, so the target user base must be tech-savvy. Hence, it makes complete sense to spend on digital ads. There are several digital channels that fintech companies can use to market their products. Social media is one of the primary channels. Beyond these, they can also advertise their products on app stores. For example, Wealthsimple targets millennials and runs paid ads on Facebook. They make use of influencer programs and share their blogs on Facebook. Coinbase makes their ads more visual with screenshots of their app. A great social media for visual content is Instagram, and that is where they advertise the most.
10. Invest in referral and influencer programs
Referral programs have been indispensable in helping people get started with fintech services. In India, Google Pay, which started as “Tez” offered people a cashback on their first transaction. Most users would transfer the minimum amount to their friend and get it back from them, earning the cashback in return. This offer incentivized the users to get familiar with the app and use it more. Many wallet services also offered a similar incentive. Influencer marketing is also a way to promote fintech products. However, the company should be able to track the reach and relevance of the program.
Fintech marketing: final thoughts
The marketing strategy for fintech products/services requires an in-depth understanding of the financial situation of the target audience. New opportunities have emerged recently for fintech companies, and they can play an important role in filling the gap left by the traditional banking system. While ad campaigns and referral programs are a great way to expand their reach, aligning their products and services with the user needs is the most effective form of marketing.
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Promoting fintech products requires a strategic approach and an in-depth understanding of the financial situation and needs of the target user base. Read the article for a better understanding of the fintech marketing strategy.
In general, fintech products include financial services offered via the internet, mobile devices (apps), and software (cloud services).
The most popular fintech business models are alternative credit scoring, alternative insurance underwriting, wealth tech and asset management, digital wallets, small-ticket loans, and P2P lending.