tag:www.econsultancy.com,2008:/topics/product-management Latest Product Management content from Econsultancy 2017-04-10T10:00:00+01:00 tag:www.econsultancy.com,2008:BlogPost/68979 2017-04-10T10:00:00+01:00 2017-04-10T10:00:00+01:00 A day in the life of...a director of digital product management Ben Davis <p>If you're looking for a new challenge, why not check out the <a href="https://jobs.econsultancy.com/">Econsultancy digital jobs board</a>.</p> <h4>Econsultancy: Please describe your job: What do you do? </h4> <p><strong>Muriel Alvarez:</strong> I’m a Director of <a href="https://econsultancy.com/blog/67500-what-is-digital-product-management/">Product Management</a> at Work &amp; Co. We’re a digital product agency with nearly 200 people across offices in New York, Portland and Rio de Janeiro.</p> <p>Every day, I work with insanely talented designers, engineers, and fellow product managers. We all have a common goal: creating and launching great digital experiences that will move the needle for our clients’ business and that people also love to use. Our clients include Apple, Google, Facebook, Nike, Marriott, Chase and Planned Parenthood.  </p> <p>In my job, I’ve got three main responsibilities: (1) strategize with clients on the smartest ways to drive their businesses; (2) work with teams to create beautiful, fun-to-use digital experiences that serve both business and customer needs; and (3) keep everyone focused on getting our work shipped and into the hands of millions of people.</p> <p>The last point is really key. We believe that our products are successful only if they’re being used and adding value to people’s lives.</p> <p><img src="https://assets.econsultancy.com/images/0008/5326/muriel_full.JPG" alt="muriel alvarez" width="300"> </p> <p><em>Muriel Alvarez</em></p> <h4>E: Whereabouts do you sit within the organisation? Who do you report to?</h4> <p><strong>MA:</strong> One of the big reasons I came to Work &amp; Co is that where I am in the organizational hierarchy doesn’t really matter. Officially, I report to one of the partners of the company. But in reality, that makes little difference to what I do day in and day out because we’re all part of a team.</p> <p>For example, in a meeting recently several of us were looking at concepts for a new website. The problem we were trying to solve was how to make the site more personable, and less intimidating for users. Everyone shared ideas. We pushed and critiqued each other. At the end of that half hour, we made progress. That’s what’s important. </p> <h4>E: What kind of skills do you need to be effective in your role?</h4> <p><strong>MA:</strong> Being a great product manager requires a pretty specific set of skills and personality traits. You don’t need an MBA or engineering degree --I studied history in college-- but you do need to understand technology, design, and business and know how to speak those languages.</p> <p>Other critical skills are: being extremely organized, communicating clearly, keeping calm under pressure and an ability to see the larger picture while also being obsessed with the details. These skills can be improved with experience. I work at them every day.</p> <p>Then there are equally important traits that come only from genuinely being interested in solving a problem --such as asking the right questions, knowing how to uncover people’s behaviors and motivations, being unafraid to make mistakes, and staying focused.</p> <h4>E: Tell us about a typical working day…</h4> <p><strong>MA: </strong>The first thing I do is review my scheduled meetings with internal teams and clients. I prioritize the two or three most important things to get done, so that I can adjust in case something unplanned comes up (and something usually does!)</p> <p>Product managers are communicators so I talk to many people throughout the course of a day. I speak to clients constantly. We might gather around a designer or engineer’s computer to review sketches or prototypes, talk through our technology approach, or look at in-progress code.</p> <p>We check to ensure that what we’re creating for clients is both beautiful, functional, and on-brand. Our meetings aren’t formal; we continuously discuss what’s working and what can be improved. We also talk through implications from user research.</p> <p>At least a few times a week, I check in with other product managers I mentor to see how they’re doing and what help they need. I also try to carve out time that I can spend alone at my computer to research information for the team, update project Trello boards, and complete other work. </p> <h4>E: What do you love about your job? What sucks?</h4> <p><strong>MA:</strong> The moments when I feel deeply satisfied are when people with different agendas, skillsets, and experiences put heads together and make progress --no matter how large or small-- that moves our work closer to launching.</p> <p>When I was a younger product manager, I believed that keeping to a plan and delivering a website was everything. Now I realize that building relationships, making our teams stronger and more collaborative is hugely rewarding, so I spend as much time focusing on that too. When people can let their guard down, push each other to be better, go through tense and hard situations, and come out of it smiling and laughing at each others’ jokes, those times make me super happy.</p> <p>The single thing that’s hardest about my role is facing a range of competing priorities that come with building a product. On any given project, a ton of wrenches get thrown in your way. It can be easy to become distracted or lose focus, so unless you’re able to handle a lot of real-time changes, being a PM is probably not for you. </p> <p><img src="https://assets.econsultancy.com/images/0008/5342/va_app.jpg" alt="virgin america app" width="615"></p> <p><em>The Virgin America app</em></p> <h4>E: What kind of goals do you have? What are the most useful metrics and KPIs for measuring success?</h4> <p><strong>MA:</strong> Measuring success is different for each project, but we try to keep it simple and not come up with a million KPIs that maybe only a few can understand, measure, and analyze. If we’re building an app for a brand that sells something, how we define success should ladder up to a few goals: getting customers to buy, and making them satisfied with the brand and the experience it provides.</p> <h4>E: What are your favourite tools to help you to get the job done? </h4> <p><strong>MA:</strong> I don’t have any favorite tools per se, but I use tools that help me communicate with my teams and clients. Currently, Slack and Trello are two I use every day.</p> <h4>E: How did you get started in the digital industry, and where might you go from here? </h4> <p><strong>MA:</strong> I started out by building HTML websites as a freelancer. I honestly wasn’t great at coding, but that experience exposed me to many other parts that go into building and delivering digital products. Within a year, I realized I didn’t want to be responsible for only a few isolated parts of the process. I wanted to be able to see things through from start to finish, which is why I moved on to product management.</p> <p>All told, I’ve been in the digital field for over a decade, managing projects and products for a broad range of clients --from Ford to Facebook. I have a lot more to learn, and hopefully more people to work with, so I’ll keep doing this for a while.</p> <h4>E: Which brands do you think are doing digital well?</h4> <p><strong>MA:</strong> My barometer for brands that are doing well in digital is whether or not their products are ones that millions of people --myself included-- find useful every day, such as HBO, Facebook, Caviar and The New York Times (especially their cooking app).</p> <p>I also find fascinating how digital technologies can empower people to take control of their own healthcare --everything from <a href="https://econsultancy.com/reports/a-marketer-s-guide-to-wearable-technology/">wearable devices</a> that can perform tests without having to step foot in a doctor’s office to tools now making it easier for patients to access and share their medical records. There are a handful of startups tackling challenging problems in that space.</p> <h4>E: Do you have any advice for people who want to work in the digital industry?</h4> <p><strong>MA:</strong> Use digital products. Know what works and what doesn’t and why. Try to pick up skills that you don’t have – like learning how to code. Don’t be someone who’s hard to work with. Being successful in the industry means you’ll work with many different people of varying skills and viewpoints and you’ll have a much easier time contributing to the end product if you’re respectful and empathetic to others.</p> tag:www.econsultancy.com,2008:BlogPost/68896 2017-03-15T14:17:00+00:00 2017-03-15T14:17:00+00:00 Nine questions to ask your new ecommerce platform supplier when migrating Emma Forward <p>The below will be a good starting point for discussions.</p> <h4>1.<strong> How agile are you?</strong> </h4> <p>Heaps of agencies claim to be agile but you’ll want to check your expectations on workflow and practices are aligned before you sign up. </p> <p>You might want to consider the following in your negotiations:</p> <ul> <li>Visibility of all tasks being worked on, ideally on JIRA.</li> </ul> <p> <img src="https://assets.econsultancy.com/images/resized/0008/4679/scrum_board_jpg-blog-flyer.jpg" alt="Scrum board" width="470" height="314"></p> <ul> <li>Daily communication with your project manager and developers.</li> <li>Ability to prioritise your backlog of user stories and bug fixes and willingness to adjust prioritisation when things change.</li> </ul> <p><img src="https://assets.econsultancy.com/images/0008/4692/user_story.JPG" alt="" width="700" height="448"></p> <ul> <li>Trust your agency to estimate tasks in either hours or story points so that you know how many tasks will be delivered that month.</li> <li>Have a set monthly retainer to spend each month on site maintenance and optimisations (whilst keeping question four in mind), rather than an ad hoc pot of money for development work.</li> <li>Clarity on acceptance criteria. Detailing exactly what you expect the task to enable the user to do, what it should look like, how it should work, what it should and shouldn’t affect (nothing is too obvious), is so crucial to avoid misunderstandings and ensure a task passes customer testing first time.</li> <li>Clear accountability. Ensure tasks are thoroughly tested by the developers before being handed to you to go through with a fine tooth comb. Ideally another developer should review the developer’s work, then it should go to their internal QA team, and only if it passes both those steps should it be passed to the client to sign off.</li> </ul> <h4><strong>2. What does support include? </strong></h4> <p>Every agency will charge for support differently. Some agencies might include a bit of development time in your support fee, others will clearly distinguish between ‘How do I…?’ advice and investigation work needed by developers to fix bugs.</p> <p>There’s not necessarily a right or wrong way, just so long as you’re clear what the escalation processes are and who your points of contact are for different issues. </p> <p>For instance, your agency may have a support desk as the first port of call, which is suitable for emailing questions like ‘How do I do xyz in the admin?’ or ‘Why can’t I get this roundel to show up on that product page?’. </p> <p>If there’s a serious Priority 1 issue though (e.g. the site goes down or you can’t access the checkout page), then you’ll want to be able to phone your project manager and expect them to look into it within the hour, depending on the service level agreement that you sign. </p> <h4><strong>3. How much do you charge per hour?</strong></h4> <p>Obviously pricing will depend on the agency, but try to make sure you get a like-for-like comparison so that you can easily compare hourly rates across the different agencies that are tendering (some might quote daily rates for instance). </p> <p>Agencies may charge different amounts depending on whether it’s front-end, back-end or strategy work. You’ll also be paying for your project manager’s time, so don’t forget to factor that in. </p> <p>What may sound like more than enough hours per month on these may transpire not to be, because it has to include all internal meetings your agency has about your work (e.g. weekly estimation meetings, daily stand ups), as well as the likelihood of more than one developer working on the same task.</p> <p>Some agencies will charge for client meetings, others will use their discretion. </p> <h4><strong>4. How often can I flex the retainer?</strong></h4> <p>Your stakeholders are pushing for Feefo reviews, or you may want to bring forward gift wrapping in time for the Christmas trading period. Whatever it is, there may be some months when you want to increase your monthly retainer to deliver functionality quicker. Running out of budget half way through the month is really frustrating for all involved. </p> <p>Similarly, if you’re running a small business, budget for development may need to be diverted to other costs for a couple of months. </p> <p>Make sure that the contract allows you to decrease or increase your retainer when you need to. It’s only fair to give your agency notice because they’ll need to ensure there is available resource if it’s an increase, but check that the notice they’re asking for is reasonable.</p> <h4><strong>5. Will I have access to developers?</strong></h4> <p>The ability to communicate directly with developers is a deal-breaker, be it via Slack or a project management platform like JIRA.</p> <p>Of course, your project manager plays a pivotal role in briefing the team on tasks, but rather than he or she having to be the interface between you and the dev team when they have questions, I’ve found it much more cost and time-efficient to answer the developers’ questions directly, especially when you’re writing your own user stories and acceptance criteria.</p> <p><img src="https://assets.econsultancy.com/images/0008/4672/Dev_comms.JPG" alt="" width="700"></p> <p>You know better than anyone how you expect the functionality to work and you don’t want anything lost in translation. Provide anything you can to make your expectations clear – mock ups, screenshots and videos all help.</p> <h4><strong>6. Who owns the code?</strong></h4> <p>Firstly, check your existing supplier’s contract: if they own the code, it could be difficult and costly to migrate the code base as is to a new agency. It may end up being more cost-effective to re-build rather than to strike a deal.</p> <p>If you own the code, then you should be able to migrate to a new agency (see next question), but you want to make sure code ownership is written into the new supplier’s contract too to future-proof yourself, bearing in mind the average ecommerce site’s lifecycle is five or six years.</p> <h4><strong>7. Experience of migrating old code as well as building new sites?</strong></h4> <p>It’s never a new supplier’s preference to take over another agency’s code base. Migrations are cheaper than total rebuilds, and agencies will usually try to sell-in the re-build over a migration. Once you’ve honed in on a new supplier, request a code audit to ensure they can take over the code base, maintain it and extend it going forward. </p> <p>A decent agency will do the audit objectively, and should tell you which areas of the code may be areas of concern (usually third-party extensions or customisations by the incumbent supplier). </p> <p>Do take it with a pinch of salt though; there may be an element of sucking teeth at another workman’s work, and the site doesn’t have necessarily have to pass with flying colours to be portable.</p> <h4><strong>8. Do you outsource any development?</strong></h4> <p>Understandably, agencies often won’t volunteer this information without being asked directly.</p> <p>While outsourcing developers enables smaller agencies to offer cheaper hourly rates, you can sometimes risk quality, not to mention on a basic level, it’s tricky to work with developers in different time zones if you don’t want to be camping out in the office.</p> <h4><strong>9. Who looks after hosting?</strong></h4> <p>Your new agency will most likely have a preferred hosting provider. If you’re very happy with your existing hosting company, stick to your guns, as it could keep costs down not changing servers. </p> <p>However, if it’s a pre-requisite for the new agency to use their hosting supplier, negotiate on cost, and decide whether you’d prefer to look after the hosting relationship directly or whether you’d rather your agency did this.</p> <h4>In conclusion...</h4> <p>Migrating to an alternative agency can inject new ideas, enthusiasm and proactivity into your ecommerce site, which can come together to increase conversion rate and ultimately turnover of your site through carefully crafted acceptance criteria, properly tested functionality and well-considered changes.</p> <p>Asking the right questions before you commit to a migration can help to ensure the new agency will be able to deliver the strong partnership that you’re after and ultimately the return on investment that your stakeholders will expect.</p> <p><em>To learn more on this topic, book yourself onto one of Econsultancy’s <a href="https://econsultancy.com/training/courses/topics/ecommerce/">ecommerce training courses</a>.</em></p> tag:www.econsultancy.com,2008:BlogPost/68882 2017-03-13T10:00:00+00:00 2017-03-13T10:00:00+00:00 Four ways Tiger is transforming the in-store retail experience Nikki Gilliland <h3>Design-lead concept</h3> <p>Unlike other stores with a similar price range, Tiger does not lead with a low-cost concept. Instead, it is better known for its focus on design, stocking a wide range of cheap, cheerful and brightly coloured products – often sourced from Asia.</p> <p>It is a formula that has become a hallmark, and in turn, has made Tiger’s proposition about more than just affordable prices. </p> <p>You might go into a Tiger in search of a specific item, but more often than not, regular consumers also visit for the purpose of having a browse. This is because - drawing on its tagline of ‘everyday magic’ – it promotes the idea that you don’t know what you might find in its stores. </p> <p>While sourcing products from Asia surely helps to offer consumers something new, Tiger has also taken steps to commission artists to create original items specifically for the store. For example, it has previously partnered with Japanese artist Misaki Kawai to create a range of unique tote bags.</p> <p><img src="https://assets.econsultancy.com/images/0008/4520/Tiger_online.JPG" alt="" width="780" height="398"></p> <h3>Low-cost quality</h3> <p>While the majority of Tiger’s items are very low in price, often falling between just £1 to £3, Tiger doesn’t sell itself on this basis. More importantly, it manages to bypass the notion that low-price equals low quality, and this is largely due to the store’s all-inclusive nature.</p> <p>By refusing to shout about its prices, it has managed to disrupt the idea that cheap equals a poorly-made product.</p> <p>Of course, that is not to say that the consumer does not appreciate good value. Rather, perhaps that consumers are beginning to consider their money even more than ever before – with expectations becoming less about BOGOF offers and more about legitimate value as well as quality.</p> <p><img src="https://assets.econsultancy.com/images/0008/4518/Tiger_store.JPG" alt="" width="780" height="521"></p> <h3>Seasonal products and travel stores</h3> <p>Another reason why Tiger has generated a loyal following is its dedication to the changing seasons. </p> <p>You only have to look at its social media channels to see how it taps into events like Easter and Pancake Day – conveniently selling season-related products you probably never knew existed.</p> <p>Similarly, it is able to drive sales of its craft and DIY products by continuously introducing new ranges, in turn ensuring that its stores remain interesting and exciting to even the most regular consumers.</p> <p><img src="https://assets.econsultancy.com/images/0008/4519/Tiger_Insta.JPG" alt="" width="780" height="519"></p> <p>Tiger has also recently entered the <a href="https://econsultancy.com/blog/68371-why-travel-retail-is-big-business-for-beauty-brands/" target="_blank">travel retail</a> space, opening its first ever store in a London tube station. With a slightly different product-range, skewed to ‘on the go’ consumers, it is a sign that Tiger is intent on expanding – as well as evidence that there is a demand for it.</p> <h3>In-store discovery</h3> <p>When it comes to its in-store layout, Tiger has clearly been inspired by fellow Scandinavian brand, <a href="https://econsultancy.com/blog/67694-10-examples-of-great-ikea-marketing-creative/" target="_blank">Ikea</a>. Its larger shops are distinctly labyrinthine, taking consumers on a one-way journey through the entire store.</p> <p>It’s a clever concept. Not only does it ensure consumers will travel past all potential products before they leave, increasing the likelihood of an impulse purchase, but it also builds on consumer panic. For example, by placing food and drink items near the checkout, but not quite the nearest thing to it, consumers will pick up these items knowing they won’t easily be able to turn back again.</p> <p>It’s not only the layout that sets Tiger apart, of course. Its focus on the ‘surprise and discovery’ concept of its stores extends even to the background music, with the stores playing a familiar soundtrack of songs from the 1960’s to the 1990’s. </p> <p>Whether or not you actually need anything it sells, there’s no doubt Tiger is intent on changing the stale shopping experience of most low-price stores.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">These mini notebooks from <a href="https://twitter.com/FlyingTigerCph">@FlyingTigerCph</a> really speak to my soul <a href="https://t.co/DLois99DFO">pic.twitter.com/DLois99DFO</a></p> — Billy Davis (@Billy_Davis85) <a href="https://twitter.com/Billy_Davis85/status/838089100385271809">March 4, 2017</a> </blockquote> <p><em><strong>Related articles:</strong></em></p> <p><a href="https://econsultancy.com/blog/68787-why-did-poundland-s-ecommerce-trial-fail/" target="_blank">Why did Poundland’s ecommerce trial fail?</a></p> tag:www.econsultancy.com,2008:BlogPost/68643 2016-12-19T10:00:00+00:00 2016-12-19T10:00:00+00:00 Why hackathons are valuable for marketers as well as techies David Moth <p>The events range in size and prestige, from small internal hackathons to competitions hosted by tech giants where there are big cash prizes on offer.</p> <p>While they’re normally associated with techies and coders, the Econsultancy and IBM iX hackathon I attended was aimed at inspiring marketers to consider new customer experiences and ways of working.</p> <p>It began with a discussion around the importance of Design Thinking, before the marketers broke into groups and were challenged to conceptualize product ideas that would ease existing customer pain points.</p> <p>For those unfamiliar with design thinking, this series of posts is a perfect way to get to grips with the concept:</p> <ul> <li><a href="https://econsultancy.com/blog/68503-what-is-design-thinking/">What is design thinking?</a></li> <li><a href="https://econsultancy.com/blog/68509-why-is-design-thinking-suddenly-so-important/">Why is design thinking suddenly so important?</a></li> <li><a href="https://econsultancy.com/blog/68510-how-can-marketers-employ-design-thinking">How can marketers employ design thinking?</a></li> </ul> <p>But aside from the lesson in design thinking, the event was a useful insight into how hackathons work and how they can be a worthwhile exercise for marketers.</p> <p>Here are some of my takeaways on why hackathons aren’t just for coders. We're also planning to run some more hackathons in partnership with IBM iX in 2017, so Econsultancy subscribers should look out for more information on how to apply.</p> <h3>Drags people out of their comfort zone</h3> <p>The most obvious benefit of a hackathon is that it gives people a day away from their regular tasks.</p> <p>All jobs have a certain routine or rhythm to them, and it’s important to mix things up to provide some variety and inspiration.</p> <p><iframe src="https://www.facebook.com/plugins/post.php?href=https%3A%2F%2Fwww.facebook.com%2Fzuck%2Fposts%2F10102285103820421%3A0&amp;width=500" width="500" height="511"></iframe></p> <p>Hackathons give people the opportunity to step out of their comfort zone and take on a new (and hopefully fun) challenge, if only for an afternoon.</p> <p>Stepping away from the computer to a new location – ideally off-site, not just a meeting room – can be invigorating and provides relief from the day-to-day grind.</p> <h3>Helps you to see the bigger picture</h3> <p>In the rush to complete tasks and hit deadlines it’s understandable that people become focused on the priorities and goals specific to their business unit.</p> <p>By challenging employees to consider customer pain points outside of their normal area of focus it forces them to take a broader view of the customer experience.</p> <p>Ideally this will give them a fresh perspective on their own role and how it fits within the customer journey.</p> <p>It might also encourage them to consider new solutions and ways of working when dealing with the familiar problems in their day job.</p> <h3>Puts the focus back on the customer</h3> <p>Design thinking is all about creating experiences that cater to the needs of the customer.</p> <p>Econsultancy’s <a href="https://econsultancy.com/reports/marketing-budgets/">research into marketing budgets for 2016</a> found that nearly three-quarters (73%) of company respondents are ‘working towards delivering cohesive customer experiences, rather than standalone campaigns or interactions’.</p> <p><img src="https://assets.econsultancy.com/images/0008/2464/cx_chart.png" alt="" width="345" height="426"></p> <p>But while customer experience has been an important trend within marketing for more than a year, many companies are still driven by business priorities rather than customer needs. </p> <p>At the IBM Hackathon attendees were asked to discuss pain points associated with a specific customer persona and then design a new product experience which solved that problem.</p> <p>Most employees probably don’t often get the opportunity to dedicate an afternoon to thinking about how to improve the customer experience, so the exercise is extremely useful for jolting employees into thinking about the broader customer journey and how they can impact it. </p> <h3>Work alongside new people</h3> <p>For the IBM hackathon we invited a select few of our subscribers, which gave attendees the opportunity to collaborate with new people from different businesses.</p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">Our <a href="https://twitter.com/ibminteractive">@ibminteractive</a> Design Thinking Hackathon teams are just identifying customer pain points. Product ideas come next. <a href="https://t.co/CEk6LwNSPp">pic.twitter.com/CEk6LwNSPp</a></p> — Econsultancy (@Econsultancy) <a href="https://twitter.com/Econsultancy/status/805784694398844928">December 5, 2016</a> </blockquote> <p>This provides a useful networking opportunity, but more importantly we’ve found that people are more willing to open up when they aren’t around their normal colleagues.</p> <p>If you’re organising your own internal hackathon then it still gives people the chance to collaborate with new people, which will hopefully foster new relationships and help to break down those pesky silos.</p> <h3>New ideas</h3> <p>New ideas are the most obvious benefit, as it’s really the whole reason hackathons were invented. However, it’s not something we should overlook.</p> <p>While our Design Thinking Hackathon was focused on creating new products and processes, you could just as easily ask attendees to design a new marketing campaign.</p> <p>That’s exactly what <a href="https://blog.hubspot.com/blog/tabid/6307/bid/33369/How-to-Create-200-Hours-Worth-of-Marketing-Content-in-One-Night.aspx#sm.001sr30k9eo6fl3117d2lbkq7ozii">Hubspot did back in 2012</a>, hosting an event that gave its marketing team an evening to create an entire campaign from scratch in one evening.</p> <p>I’m a bit concerned by Hubspot’s measure of success for the hackathon - ‘we cranked out over a couple hundred hours of work in one night’ - but it’s still a great way of generating loads of new marketing ideas, alongside the other benefits mentioned in this post.</p> tag:www.econsultancy.com,2008:BlogPost/68625 2016-12-15T14:35:56+00:00 2016-12-15T14:35:56+00:00 What can marketers learn from SaaS (software-as-a-service) businesses? Ashley Friedlein <p>Popular categories include beauty and grooming, food and drink, and pets. Although startups such as Graze (healthy snack boxes on subscription) pioneered this space in ecommerce, the bigger players are rapidly trying to play catch up: Walmart (Beauty Box), Starbucks, Macy’s and others.</p> <p>Perhaps the most interesting is Amazon. In many ways, its Prime membership is a form of subscription. It aims to reduce friction and encourage repeat purchase and loyalty.</p> <p>Amazon’s Dash buttons are also designed to make repeat purchase super easy. Amazon’s Fresh service for groceries, <a href="https://econsultancy.com/blog/67992-how-amazonfresh-is-hoping-to-threaten-the-uk-s-big-four-supermarkets/">recently launched in the UK</a>, is not strictly speaking a subscription service but it is close to that, aiming again to take away purchase friction for your weekly shop.</p> <p><img src="https://assets.econsultancy.com/images/0008/2301/amazon_dash.png" alt="" width="800" height="433"></p> <p>It seems even relatively low-consideration items that might not have regular or predictable repeat purchase cycles can work within a subscription offering. Printer ink is increasingly sold ‘as a service’ via a subscription model, for example HP Instant Ink.</p> <p>These shifts in business model and proposition have implications, of course, for marketing.</p> <p>Among the more sophisticated and mature players in digital subscription marketing and selling are SaaS (software-as-a-service) businesses. So <strong>what can we learn from SaaS marketing and models?</strong></p> <p>First, it is worth understanding the key business, and therefore marketing, metrics for SaaS.</p> <p>If you believe you are selling something one-off, then you tend to think mostly about top-of-funnel metrics, and cost per acquisition (CPA) is based on a single conversion event.</p> <p>In a subscription business, however, the key metrics are about usage, churn and yield, with lifetime value (LTV) and acquisition cost payback periods being the most important marketing metrics. If you have good loyalty, you can typically afford to spend more to acquire and keep customers.</p> <p>Second, and this relates directly to loyalty and yield, successful SaaS businesses are obsessively product-centric. They focus on the product, for example not underestimating the importance of the user interface.</p> <p>Marketing’s job becomes less about pushing out a message and more about listening to customers in order to help refine and improve the customer experience. This might include supporting customers with relevant and helpful content: Tutorials, demos, better product imagery and information, checklists, usage suggestions, tips, community and so on.</p> <p>Third, service and support should be seen as a revenue source, not a cost centre. In the SaaS world, it is often said ‘customer success is the new sales’.</p> <p>If your mindset is only a one-off transaction, then any support or service seems like a cost that detracts from the value of the sale you made.</p> <p>As soon as you look at it from a subscription perspective, with a certain LTV and the opportunity to upgrade the customer to a higher-level subscription offering, service becomes a fantastic opportunity to engage with customers, delight them and increase their profitability and yield. I have argued before that service and support should be considered part of the marketing function.</p> <p>Finally, we can learn from the culture and processes that SaaS businesses typically apply, not just to marketing but their entire operations.</p> <p>Many SaaS services are not only subscription-based but also monthly, rather than annual, subscriptions. This forces them to stay good all the time because customers can leave as quickly as they arrive. They have to keep improving the product, keep the service levels high, keep comparing themselves to the competition.</p> <p>This means their operational rhythm is ‘agile’, their culture is about rapid iteration, test and learn, about automation and scaling, about being ‘always on’. All things I hear marketing functions aspiring to become.</p> <p>Perhaps it is worth trying to envision your product or service as a subscription offering if it is not already. Perhaps you should consider hiring a marketer with SaaS-type marketing expertise.</p> <p>How might you do your marketing differently as a result?</p> <p><em>For more on this topic, see:</em></p> <ul> <li><a href="https://econsultancy.com/blog/66034-the-pros-and-cons-of-subscription-ecommerce-models/"><em>The pros and cons of subscription ecommerce models</em></a></li> <li><a href="https://econsultancy.com/blog/68545-five-ways-subscription-box-services-can-increase-customer-retention/"><em>Five ways subscription box services can increase customer retention</em></a></li> <li><a href="https://econsultancy.com/blog/67458-six-things-that-make-a-good-subscription-service/"><em>Six things that make a good subscription service</em></a></li> </ul> tag:www.econsultancy.com,2008:BlogPost/68489 2016-11-10T14:29:00+00:00 2016-11-10T14:29:00+00:00 Five ways financial services companies are adapting to the new digital age Juliet Stott <p>At a recent event, A New Age of Digital Finance, ORM managing director Keith Nation said: </p> <blockquote> <p>The millennials are expecting to interact with banks in the same way they do with Uber. The younger generation are time poor and they expect a world of hyper convenience; and they want a frictionless digital relationship with their bank too.</p> </blockquote> <p>But <a href="https://econsultancy.com/training/digital-transformation/">digital transformation</a> in this sector is slow to happen. Legacy systems, disparate data silos, internal resistance to change, lack of digital expertise, and tight governmental regulations are just some of the problems financial service (FS) businesses are trying to solve to meet consumer demand.</p> <p>In the meantime, challenger banks and startup fintech companies are offering new products and services that are attractive to the new generation of digital-first consumers.</p> <p>At the event, guest speakers from the UK’s biggest names in retail banking – including Barclays and TSB, along with wealth management company Allianz Global Investors – addressed their digital challenges and presented ways they’re overcoming these issues. </p> <p>Here is what was said:</p> <h4>1. Seeking out the single customer view</h4> <p>A digital consolidated data-set, which can be used across all channels to provide customers with a seamless digital experience, is the <em>“nirvana”</em> said Julian Brewer, Head of Digital Sales and Products at TSB.</p> <p>But many banks, including TSB, have a long way to go; legacy systems, ownership rights over proprietary data and fragmented data sources are just some of the many stumbling blocks that prevent <a href="https://econsultancy.com/blog/65425-what-is-the-single-customer-view-and-why-do-you-need-it/">the single customer view</a> becoming a reality.</p> <p>Brewer said many of the banks are looking to find ways of bringing data together within a DMP; however this is a complex and costly endeavour.</p> <p>TSB uses a tool called Tealium Audience Stream to create a CMP (Customer Marketing Platform) which pulls the limited data sources available to the bank together into a single view, and delivers many of the benefits of a more traditional DMP.</p> <p>“From this, we’re able to use our first-party data to create real-time audience segments and tailor our digital onsite and offsite marketing to great effect, and make this experience more relevant to our customers,” he said.</p> <h4>2. Reclaiming digital content</h4> <p>In recent years, many asset manager marketers have fallen into the trap of giving their content to other sites, either for free (to aggregators) or have paid other publications (such as The FT or CityWire) to publish their content, in the belief that it will bring them closer to their clients and prospects.</p> <p>This has been a mistake, as these aggregators and publishers have ended up owning the relationships with the asset manager’s customers, and not shared any information on how the content was consumed.</p> <p>Tom Hughes, Head of Marketing at Allianz Global Investors, said: “Marketers need to understand the value of their own website and the insight it provides.”</p> <p>He said marketers need a change of mindset, as websites should no longer be viewed as just “shop windows.”</p> <p>“Websites need to provide a utility for clients; they need to have content that’s useful for them so they are are encouraged to return.</p> <p>"Every click, and every interaction that happens your website, is valuable. If you can work out the causation between this activity and the sale of a product, that’s gold,” said Hughes.</p> <h4>3. Taking control of your CRM</h4> <p>The advancement of digital has come with an abundance of data; and more pressure for marketers to answer questions from the C-suite such as:</p> <ul> <li>What’s the ROI on our spend?</li> <li>Who’s been on the website? What did they click on?</li> <li>Who opened that email? Where did they open it? From what device?</li> </ul> <p>In the past, when marketing was a linear process and the CRM was used to manage sales funnels, marketers didn’t get involved in data. But that’s all changed.</p> <p>CRM is now the hub of information and the crux of the relationship between marketing and sales.</p> <p>Jason Lark, MD at Celerity, said: “If you don’t have a hold on your CRM and how it connects with all the platforms you’re building, and if you don’t know how each communication is performing, then you’re going to fail.</p> <p>"You need a good website, with high performing content where you can capture data. [It’ll] underpin your relationship with your customers and your sales team.”</p> <h4>4. Putting the customer at the heart of the digital transformation</h4> <p>Barclays Bank has refocussed its business model and says it is putting its customers at the heart of everything it does.</p> <p>“We want to help our customers hit their financial goals and achievements, and we’re going to use our transactional level data to do this,” said Sharukh Naqvi, Barclays Bank's VP of analytics and personalisation.</p> <p>Barclays is not the only company realigning its business model to put the customer at the core. Disney has invested heavily in the customer experience.</p> <p>It’s created a piece of wearable tech, a wristband called Magic Band, which enables its customers to make purchases without a credit card or cash, gain entry to its parks and resorts, book Fast Passes, make dinner reservations and receive personalised offers.</p> <p>As Brian Solis, leading expert on experiential business models, said in his latest book:</p> <blockquote> <p>In order to be competitive, brands must get better not only at understanding and satisfying customers’ wants and needs but at anticipating them, even before customers know what they want and need.</p> <p>This proactive experience is quickly becoming the new standard.</p> </blockquote> <h4>5. Catering for more sophisticated audiences</h4> <p>The millennial generation are internet natives. They are mobile-first and learn, work, shop and socialise online.</p> <p>They expect speedy, efficient customer service across all channels, from any institution they choose to engage with, day or night. If financial services brands can’t provide great digital service, said Andy Farmer Executive Strategy Director at ORM, then these consumers will go elsewhere.</p> <p>“The rise of fintech companies like Funding Circle, Nutmeg and eToro is no surprise; they’re very attractive to digitally-able younger consumers. These brands aren’t taking huge marketshare at the moment, but they are nibbling away at the edges.”  </p> <p>Traditional banks are reacting to this change in a number of ways, such as creating “<a href="https://econsultancy.com/blog/68356-what-is-an-innovation-lab-and-how-do-they-work/">innovation labs</a>” within their businesses.</p> <p>And, in some cases, directly investing in fintech companies outright; all to keep pace with technology and remain competitive.</p> <p><em>For more on this topic, see:</em></p> <ul> <li><a href="https://econsultancy.com/reports/digital-transformation-in-the-financial-services-sector-2016/"><em>Digital Transformation in the Financial Services Sector</em></a></li> <li><a href="https://econsultancy.com/reports/digital-trends-in-the-financial-services-and-insurance-sector-2016/"><em>Digital Trends in the Financial Services and Insurance Sector</em></a></li> <li><a href="https://econsultancy.com/blog/67202-what-s-the-future-for-big-banks-in-a-fintech-world/"><em>What's the future for big banks in a FinTech world?</em></a></li> </ul> tag:www.econsultancy.com,2008:BlogPost/68420 2016-10-24T10:11:00+01:00 2016-10-24T10:11:00+01:00 How to make your mark as a disruptive startup Nikki Gilliland <p>So, where exactly should you start?</p> <p>Recently, we sat down with six executives from the <a href="https://econsultancy.com/reports/top-100-disruptive-brands-2016/" target="_blank">Top 100 Disruptive Brands</a> list, a report produced in association with Marketing week, to find out their top tips.</p> <p>You can see the interviews in full by watching the video below, or read on for a summary of what they said.</p> <p><iframe src="https://player.vimeo.com/video/184675406" width="640" height="360"></iframe> </p> <h3>Buying time</h3> <p>According to Eren Ogazir, the founder and CEO of Push Doctor, time is one of the most important factors for setting up a company. </p> <p>As a result, whether it is in terms of help from friends or family or free services from those around you, he emphasises how you should focus on buying yourself time in order to gain the flexibility you need.</p> <p>In doing so, you will be able to move towards the end solution at a quicker pace, without having to worry about finding extra income.</p> <h3>Simplifying the proposition</h3> <p>Justin Basini from ClearScore suggests that disruptive startups can be guilty of over-complicating their proposition, especially when entering a complicated market like finance or technology.</p> <p>However, the best thing to do is to hone it down to a single sentence so that it can be communicated to consumers in simple terms.</p> <blockquote> <p>In the case of ClearScore, it is “get your credit score for free for ever”. It doesn’t get any simpler than that – it is really easy to communicate. </p> </blockquote> <h3>Caring about the customer</h3> <p>It might sound obvious, but many startups focus on the end goal rather than finding out exactly what it is the customer wants from your product or service.</p> <p>The founder of Pact, Stephen Rapoport, explains how a non-existent marketing budget meant that he was forced to take other measures in order to get the word out to consumers.</p> <p>By using social media channels like Twitter, he was able to build trust on a one-to-one level with customers – even delivering the product in person. </p> <p>This enabled him to tweak and hone the company’s proposition, website and product in line with customer feedback.</p> <h3>Sticking to your guns</h3> <p>Having a strong vision for the company is a given, but Emma Chalwin, Marketing Leader at Salesforce, suggests that sticking to it in the face of opposition is key.</p> <p>Whether the obstacles are in the form of resistance to investment or simply people not believing in your idea, it is easy to waver at this point and bend to the perception of others.</p> <blockquote> <p>If you really believe that your proposition and your vision for the customer experience within your industry is valid, then really stick to your guns and take that risk.</p> </blockquote> <p><em>Download the <a href="https://econsultancy.com/reports/top-100-disruptive-brands-2016/" target="_blank">Top 100 Disruptive Brands report</a>.</em></p> tag:www.econsultancy.com,2008:BlogPost/68368 2016-10-12T15:11:43+01:00 2016-10-12T15:11:43+01:00 To win over millennials, brokerage firms rethink their digital services Patricio Robles <p>In an attempt to address that challenge, a number of upstart brokerages are rethinking how their services function and how they charge for them.</p> <p>For example, <a href="https://www.robinhood.com/">Robinhood</a> is a brokerage firm that has a unique proposition: _ts customers can trade only through the company's smartphone app, which is far more simple than those offered by many brokerages.</p> <p>The firm, which has raised over $60m in funding from investors, says that 80% of its users are millennials and the average age of its customers is 28.</p> <p>Not surprisingly, many of Robinhood's customers reportedly have smaller accounts, but the company is betting that as they increase their earnings and funnel more of their money into stock market investments, the loyalty it has built will pay off.</p> <p>Another startup broker, Divy, aims to attract millennials <a href="http://www.barrons.com/articles/two-new-mobile-investing-apps-for-millennials-1453527209">by adding</a> a social layer to investing and allows its customers to buy fractional shares of company stock with friends and family in increments of as little as $10. </p> <p>"Investing in very small increments, while looking at what your friends and colleagues are doing, helps you think about the markets much more broadly," the company's founder, Marc Teren, <a href="http://www.barrons.com/articles/two-new-mobile-investing-apps-for-millennials-1453527209">told Barron's</a>.</p> <h3>Applying familiar business models</h3> <p>Some brokers are rethinking their business models, going so far as to apply business models from other industries.</p> <p>For example, last month, Motif, a Silicon Valley-based brokerage startup that bills itself as a "next-generation online broker," <a href="https://www.motifinvesting.com/about/press/press_release/motif-enters-subscription-economy-introduces-motif-blue">launched</a> a subscription-based trading service called Motif BLUE.</p> <p>According to Hardeep Walia, Motif's founder and CEO:</p> <blockquote> <p>Today’s subscription-based economy means more affordable, customizable services. We don’t think that investing should be an exception, and that’s why we’ve set out to create the Amazon Prime of our industry.</p> </blockquote> <p>Motif BLUE allows customers to trade as frequently as they like without racking up transaction fees.</p> <p>Like many subscription services, Motif BLUE has multiple subscription tiers that offer different features and costs, and a one-month free trial is available.</p> <p>All tiers allow customers to create investment models, configure recurring investments and rebalance their portfolios without management fees.</p> <p>Motif says that its BLUE subscription offering "marks a shift toward business model innovation" whereas previously the company was "focused on product innovation."</p> <p>That's an important point for financial services firms that are attempting to court younger investors.</p> <p>While these firms can update their services and create new ones that are designed to appeal to their young customers, how those customers pay for those services is arguably just as crucial.</p> <p>This is because young consumers are often more comfortable with business models that are not as common in financial services.</p> <p>With BLUE, Motif can potentially lure customers who like the idea of all-you-can-eat trading for a flat monthly subscription fee.</p> <p>And millennial-focused Robinhood doesn't charge its customers transaction fees at all.</p> <p>It relies on other sources of revenue, such as interest from margin accounts, to cover the trading costs other brokerages charge their customers.</p> <h3>Will it work?</h3> <p>There's evidence that all of this is working. For instance, since its launch Robinhood has attracted over 1m customers.</p> <p>But the real question for brokerage firms that are rethinking how their services are structured and sold is whether millenials will stick with them as they grow up and their needs change.</p> <p>There's a danger they will graduate to more traditional brokers that might not meet their needs today but will tomorrow.</p> <p><em>For more on this topic, see:</em></p> <ul> <li><a href="https://econsultancy.com/blog/66536-digital-transformation-in-financial-services-challenges-and-opportunities/"><em>Digital Transformation in Financial Services: Challenges and opportunities</em></a></li> <li><a href="https://econsultancy.com/reports/digital-trends-in-the-financial-services-and-insurance-sector-2016/"><em>Digital Trends in the Financial Services and Insurance Sector</em></a></li> </ul> tag:www.econsultancy.com,2008:BlogPost/68273 2016-09-07T09:37:16+01:00 2016-09-07T09:37:16+01:00 Is customer loyalty extinct in financial services? David Moth <p>At a DMA event I attended this week several industry speakers discussed exactly this topic, and the prognosis for financial services appears to be fairly depressing.</p> <p>I’ll get the bleakest vision of the future out the way first.</p> <p>During an overview of disruptive fintech startups, Barry Clark from Future Foundation mentioned an app called <a href="https://www.knip.ch/">Knip</a> that acts as a mobile insurance broker.</p> <p>The app enables users to compare and buy insurance products, manage their policies, and even make a claim.</p> <p>While this sounds like a great service for users, this type of app has potentially dire consequences for financial services companies.</p> <p>As Clark pointed out, in this example Knip owns the customer relationship and products are completely commoditized. The insurance companies are just faceless providers.</p> <p>If these apps continue to gain popularity (and potentially branch into other areas, such as banking), should financial services companies stop investing in brand marketing altogether?</p> <p>Would it not make more sense to focus all investment into creating a brilliant back-end and operations team to ensure that integration with platforms like Knip is quick and simple?</p> <p>Stripping out marketing costs would also mean that products are cheaper for the end user.</p> <h3>Emphasising value over price</h3> <p>Following on from Clark, Katrina King from Direct Line Group (DLG) asked how financial services can combat price comparison sites by shifting their messaging to emphasise value instead of price.</p> <p>The harsh truth of the matter is that loyalty to insurance companies is mainly due to customer apathy.</p> <p>If people can be bothered to shop around for a new policy, then decisions are often driven by price - a reality reflected in the marketing messages we see from financial services companies. </p> <p><img src="https://assets.econsultancy.com/images/0007/8830/price_vs_value.jpg" alt="" width="800" height="421"></p> <p>The challenge for DLG, which shuns comparison sites, is how to avoid this race to the bottom and put the focus on the value of its services rather than the cost.</p> <p>The result was DLG’s recent ‘Fixers’ campaign featuring Harvey Keitel, which highlighted the ways in which the company helps customers when they have an emergency.</p> <p>For example, DLG provides a free hire car for 21 days if a customer’s own vehicle is stolen or damaged.</p> <p><iframe src="https://www.youtube.com/embed/QW0Y1cHpocM?wmode=transparent" width="640" height="360"></iframe></p> <p>King said that most customers only recognise the value of their insurance product when they’re complaining about something (e.g. “Why don’t you cover xx?”), as people buy on price assuming they’ll never actually have to make a claim.</p> <p>Therefore the campaign had to put a big focus on educating customers as to why value is important when buying insurance.</p> <h3>Great success</h3> <p>The Fixers campaign achieved excellent results for DLG.</p> <p>This slightly blurry slide shows that the number of people who said they feel close to the Direct Line brand increased by eight percentage points from August 2014 to September 2015.</p> <p><img src="https://assets.econsultancy.com/images/0007/8831/campaign_results.jpg" alt="" width="900" height="450"></p> <p>Furthermore, DLG received a number of positive emails from customers thanking the business for adding the benefits such as free car rental.</p> <p>As you can probably imagine, it’s not often that people write to their insurance company to say thanks.</p> <p>King said that the campaign was a success as it was created with the customer in mind. Furthermore, the messages were constantly tested and optimised to ensure maximum impact.</p> <h3>What does the future hold?</h3> <p>King’s final slide presented her view for how insurance brands can continue to compete with price comparison sites and fintech startups.</p> <p>That’s also where this post will finish.</p> <p><img src="https://assets.econsultancy.com/images/0007/8832/the_future.jpg" alt="" width="900" height="472"></p> <p><em>For more on this topic, read:</em></p> <ul> <li><a href="https://econsultancy.com/reports/digital-transformation-in-the-financial-services-sector-2016/"><em>Digital Transformation in the Financial Services Sector</em></a></li> <li><a href="https://econsultancy.com/blog/67919-five-fintech-start-ups-aiming-to-replace-traditional-banking/"><em>Five fintech start-ups aiming to replace traditional banking</em></a></li> <li><a href="https://econsultancy.com/blog/67202-what-s-the-future-for-big-banks-in-a-fintech-world/"><em>What's the future for big banks in a fintech world?</em></a></li> </ul> tag:www.econsultancy.com,2008:BlogPost/68159 2016-08-08T14:58:00+01:00 2016-08-08T14:58:00+01:00 Five ways fintech upstarts are disrupting established financial institutions Patricio Robles <p>Here are five ways fintech upstarts are disrupting large, established financial services players.<br></p> <h3>Unbundling</h3> <p>Historically, large banks served as one-stop shops and could count on their loyal customers to turn to them for all of their financial needs.</p> <p>For example, it was once a given that depositors would turn to their bank when they needed a personal, business or home loan. </p> <p>The internet changed that dynamic, and today, large numbers of consumers - perhaps the majority - aren't anywhere near as loyal to their bank.</p> <p>Instead, they are eager to shop around and comfortable using multiple providers to fill all of their financial services needs.</p> <h4>Example</h4> <p>In the wake of the Great Recession, many banks curtailed their lending to businesses.</p> <p>That created a void for upstart non-bank lenders like <a href="https://www.ondeck.com/">OnDeck Capital</a>, <a href="https://www.smartbizloans.com/">Smartbiz</a> and <a href="http://www.fundbox.com/">Fundbox</a>, which are all focused exclusively on helping small businesses access the capital they need to grow.</p> <p><img src="https://assets.econsultancy.com/images/0007/7814/smartbiz.png" alt="" width="807" height="423"></p> <h3>Creating better, more innovative products and services</h3> <p>Thanks in part to the unbundling trend, fintech upstarts often have the opportunity to create better products and services than their entrenched competitors.</p> <p>After all, what might be for a large financial institution a relatively small part of its business could be the entire focus of a fintech startup.</p> <p>That allows the latter to focus on building a better mousetrap and in turn win customers over.</p> <h4>Example</h4> <p><a href="https://www.sofi.com">SoFi</a>, an alternative lender which provides student loan refinancing, mortgages and personal loans, targets working professionals and has created an underwriting model that takes into account a borrower's education and career experience.</p> <p>In fact, as of this year, SoFi doesn't even look at a borrower's FICO score when making a lending decision.</p> <p><img src="https://assets.econsultancy.com/images/0007/7812/sofi.png" alt="" width="743" height="404"></p> <p>In addition to its unique underwriting model, SoFi offers its borrowers services such as career counseling, unemployment protection and access to community events.</p> <p>It even runs an Entrepreneur Program to help borrowers who are starting companies.</p> <h3>Improving customer experience</h3> <p>In addition to creating better products, many fintech upstarts have thrived by improving customer experience.</p> <p>While large financial institutions didn't have to worry about customer experience because of the historical lock-in they held, fintech companies use customer experience as a key point of differentiation, which gives them a real edge in customer acquisition and retention.</p> <h4>Example</h4> <p><img src="https://assets.econsultancy.com/images/0007/3863/mondo_8.jpg" alt="" width="250" height="444"> <img src="https://assets.econsultancy.com/images/0007/3860/mondo_5.jpg" alt="" width="250" height="445"></p> <p>Mondo Bank, a UK banking startup, <a href="https://econsultancy.com/blog/67613-what-banks-can-learn-from-mondo-s-record-breaking-1m-crowdfunding-campaign">raised over £1m</a> in less than two minutes in a record-breaking crowdfunding campaign thanks in large part to a simple but compelling goal: to build "a bank that’s as smart as your phone."</p> <p>While competing with big banks is not easy, <a href="https://econsultancy.com/blog/67730-fintech-startup-mondo-provides-slick-impressive-ux-review">Mondo's slick app</a> is a good example of how upstarts are creating customer experiences capable of wooing consumers away from entrenched financial institutions, many of which have antiquated customer experiences that leave a lot to be desired.</p> <p>Mondo isn't the first banking startup to focus on customer experience. Simple, a US-based branchless bank, launched in 2009 and was acquired by BBVA in 2014. </p> <h3>Offering better pricing</h3> <p>'You get what you pay for' is often true, but it isn't always true, especially when it comes to financial services.</p> <p>Consumers are increasingly aware of this and that means fewer and fewer of them are willing to pay a premium for a less-than-premium product or service.</p> <p>Fintech upstarts are exploiting increased consumer sophistication and decreased trust of large financial services providers to create offerings that have more compelling pricing.</p> <h4>Example</h4> <p>Fintech startups have taken aim at financial advisors, many of whom have come under fire for charging fees that skeptics argue are unjustified.</p> <p>Robo-advisors like <a href="https://www.wealthfront.com/">Wealthfront</a> and <a href="https://www.betterment.com/">Betterment</a> offer lower-priced alternatives that are automated.</p> <p>While the billions in assets under management that these two companies have accumulated constitute a small percentage of the market, traditional advisory firms have taken note and large firms, <a href="https://intelligent.schwab.com/">such as Schwab</a>, have launched their own robo-advisor offerings.</p> <p><img src="https://assets.econsultancy.com/images/0007/7813/betterment.png" alt="" width="769" height="279"></p> <h3>Targeting underserved markets</h3> <p>Even the largest financial institutions have left unfilled gaps in the markets they serve.</p> <p>In some cases this is intentional; underserved markets are often seen as being too small or risky to be worthwhile.</p> <p>That has created opportunity for forward-thinking upstarts, many of which not only hope to build a business serving these underserved markets, but to leverage them as footholds for later expansion into other markets.</p> <h4>Example</h4> <p>There are more than 2bn unbanked individuals around the world, and even in the US, by some estimates, 90m individuals do not participate in the banking system.</p> <p>One early fintech player, <a href="http://www.oportun.com/">Oportun</a> (previously Progreso Financiero), specifically focuses on the unbanked and underbanked Hispanic population in the US, offering unsecured loans to individuals with little to no credit history.</p> <p><iframe src="https://www.youtube.com/embed/kTTwRn0LoaI?wmode=transparent" width="560" height="315"></iframe></p> <p>Another upstart in the US targeting underserved consumers is <a href="https://www.lendup.com/">LendUp</a>.</p> <p>It has positioned itself as an alternative to traditional payday lenders, and "[strives] to provide an actionable path for customers in eligible states to move up and earn access to more money at a lower cost."</p> <p><em>For more on this topic, read:</em></p> <ul> <li><a href="https://econsultancy.com/reports/digital-transformation-in-the-financial-services-sector-2016/"><em>Digital Transformation in the Financial Services Sector</em></a></li> <li><a href="https://econsultancy.com/blog/67202-what-s-the-future-for-big-banks-in-a-fintech-world/"><em>What's the future for big banks in a FinTech world?</em></a></li> </ul>