I frequently scan the news, particularly when it relates to financial services, and one fact is inescapable: current generations will not conform to the methods of traditional financial services as previous generations have. Some financial experts will disagree, but there is a big difference between individuals who used to need access to accounts and payment services, and our digital natives. Their experiences are driven by their overall access (and success) online via mobile devices, versus a more traditional banking approach to account services. Today’s financial institutions have a range of services that should appeal to younger customers, but I find they’re missing a crucial piece—they aren’t telling their story (FIs are not good storytellers…and stories resonate with people, not facts and figures).
A good example of this is Gen Y/Z’s use of P2P services such as Venmo. Let me clarify; I am not against Venmo, as I believe Paypal’s strategy of buying the company and offering it free is a brilliant strategy. But it is a gateway to Paypal’s more industrial payment services—which are not free. As I talk with older teens and college students, I generally get the feeling they believe there isn’t a difference between their activities on Venmo and a transaction account at a financial institution. The fact is, those services are vastly different, but if someone doesn’t know the difference, how can an informed choice be made?
Here is a recent article from PYMTS.com that talks about upcoming changes at Venmo – https://www.pymnts.com/digital-payments/2018/venmo-payment-fraud-transaction-loss-rate/. Essentially, Venmo lost $40 million in the 1st quarter of 2018, which was larger than expected. Venmo attributed the loss to increased fraud, and as a result the transaction services offered by Venmo were changed, limiting easy access to send and receive payments and instant transfers to bank accounts. In short, the features that allowed Venmo to be so popular with younger customers left them open to increased fraud. This is not Venmo’s fault, or any indication they have anything less than the best security measures; this is simply the reality of the challenge to offer online financial services that balances the security of the user and their assets, with features that thrill and delight.
Financial institutions know this balancing act all too well, and they spend significant money to ensure the safety of their online accounts. They also offer FDIC insurance on those balances as well, something Venmo doesn’t have. Yet without a compelling story, why would any millennial be convinced to move their transactions over to a primary financial institution? How hard would it be for a bank to make an interesting infographic comparing online services like Venmo (the most popular), to the account services they offer? It could be available online or used in a branch to explain why we do what we do. You wouldn’t risk placing your hard earned money anywhere but a regulated, insured U.S. financial institution, so at the very least FIs could do more training with their customer and prospect-facing staff (including those responsible for the online challenges) on how to effectively tell stories.
Early in 2018, I created and delivered a storytelling webinar for the California CUL, but I don’t see other banking associations focusing on this important skill. There are, however, third parties who do an excellent job in storytelling training—one I recommend is Doug Stevenson, who offers Storytelling in Business and is based in Arizona. Check his website out here – http://www.storytelling-in-business.com/.
Okay, maybe you don’t work at a financial institution and are wondering, “do I care about this content?” Regardless of the business you’re in, how are you incorporating stories into your sales pitch and customer contact? Think about all of the compelling reasons someone should do business with you instead of a competitor. How could that list be converted into a series of short, powerful stories that can be learned and enthusiastically delivered by your sales and support teams?
Also published on Medium.