I recently helped start a company that built a branded shopping site for credit unions and incorporated an account-based underwriting algorithm which would give even the less-than-prime members a credit limit allowing them to shop, interest-free, for household goods. The program was new, and while, ultimately, the company did not survive, the marketing program developed to help the credit unions market the program showed some interesting results.
A retail oriented marketing automation system was embedded with each shopping site. Typical holiday and seasonal offerings were made as they came up. What was interesting was the curated newsletter that was the same for all credit unions (except for their branding) garnered the best results. What was even more interesting was that the curated newsletter was educational in nature with maybe one offer for the shopping site.
The type of articles that would appear were topics such as “saving for retirement,” “being a smarter shopper,” and interior design type of articles, all curated from other sources. The response to the monthly newsletter tended to beat the emails that were a direct offer for the season or holiday and they tended to continue to receive click throughs for days after― meaning readers were holding on to this electronic curated newsletter.
The Engaging Curated Newsletter
What we decided was that consumers want to educate themselves on a variety of topics and providing them a curated newsletter allowed them to learn ways to better manage their household, purchases, and a lifestyle. The credit union was becoming the center for maintaining and improving their lifestyle. It was a shift from providing transaction services to gaining a better lifestyle.
Since our lifestyles involve some form of commerce, could financial institutions begin to reinvent themselves to become lifestyle advisers through sound financial and lifestyle management advisory services? Banking as we know it is changing and is currently being interrupted with a lot of online companies. Ultimately, the transactions of saving and paying for stuff is going to be more efficient via online and automated systems, and the value of that will be measured in fractions of a penny.
The real value could be in becoming a lifestyle adviser.
Financial institutions need to rethink their model. While transactions might still be their bread and butter, they are just a means to an end―living well. If online companies are threatening the financial services, there may be a better niche as lifestyle advisers. Instead of hiring clerks, lifestyle and household advisers could be made available to help their customers live a smarter life and become a savvy shopper and better saver. Imagine going to your bank to learn about the best way to purchase that expensive appliance or figure out how to negotiate a car price.
There’s more value in knowledge and learning how to do things than ever before. Taking advantage of that could reinvent the industry move value in a direction that consumers have already moved towards.