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July 30, 2015

Simplicity in Finance: When it comes to banking, easier definitely does it

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Vegas baby. That’s where almost 900 of the hottest names in retail banking gathered to hear “Ideas, Insights & Innovations” for 2015 and beyond. We were there too, and just as hungry as the rest of the crowd to soak up the expert take on how to stay ahead in the fast-changing, highly competitive world of retail banking.

Of course, since simplicity is our mantra here at Hydrogen, we were excited to see keynote speaker Joe Reich, founder and CEO of Simple, deliver his address on innovation and simplicity in banking. Here are some of our favorite highlights:

People really don’t look forward to banking. It’s tedious, a necessary evil. For a speaker to stand in front of a crowd representing 500-plus financial institutions, it was a brave—but true—stance to take.

To survive, you have to simplify the banking experience for customers. Reduce the pain to maximize the gain.

But thanks to a slew of more and more financial products and features as well as new legislation and regulation, banking is suffering a “crisis of complexity.”It’s time to get back to the basics, people. Here, in the simplest of terms, is why customers need a financial institution:

“I have money – help me make more”
“I need money – help me get it”

That’s it. At the beginning, they’re not interested in knowing more about a specific product or service, so keep things simple. Then keep walking the walk. Simplicity rules in how you talk about products and services as well as the technology behind how a customer uses them (e.g., easy to navigate website, simple to understand online/mobile banking).

With the customer’s point of view in mind, how can banks simplify?

  1. First identify issues; find out what irritates and frustrates customers. Commit to minimalism. Ask yourself: “What can we remove?” rather than “What can we add?” Beware of feature creep.
  2. Use plain English, shorter sentences and fewer paragraphs.
  3. Communicate visually: use simple imagery, remove clutter and visual noise.
  4. Rethink marketing messages:
    • As financial marketers, it’s typical to think in terms of “what we offer”– a credit card with 9% interest rate and no fee, or auto loan with 7% interest. Often, customers don’t really care.
    • Put yourself in the customer’s shoes:
      • Imagine a guy who wants to buy a Harley. Is he looking for a home equity line or an unsecured signature loan? What about APRs and net interest spreads? He doesn’t know. Or care. What he really wants to know is whether he can afford the payment because he’s dreaming of hitting the open road.
  5. Make banking fun. If Southwest Airlines can do it for air travel, it can happen. Southwest is professional, innovative and service oriented. A positive experience, combined with a solid offering creates brand advocates. Period. Southwest proves that no industry is beyond simplification, no matter how complex it may be. In fact, the more complex something is, the more opportunities.

Sure, banking is complex. But it doesn’t have to act that way. And it certainly doesn’t have to be dull.

If you’d like to see how Hydrogen has put simplicity to work for our partner financial brands, click here.