Three Hyperlocal Best Practices Fintechs Can Adopt
Forbes Councils Member
People and businesses were forced to discover new ways to participate in the economy last year. They bought and sold online, used contactless payments, discovered Venmo and CashApp, and refinanced mortgages without being face-to-face with a personal banker.
As restrictions continue to ease, I expect a surging desire for in-person interactions. This is especially true for buying the things that can only be obtained locally and require consultation and trust, such as getting your car serviced, going to the dentist or getting a new pair of glasses. The next 10 years will be defined by the convergence of the conveniences consumers realized during the pandemic, along with people’s desire to interact. Technology will be the driver that creates the ideal omnichannel customer experience.
Building Trust Between Business And Shoppers
Is Instacart a technology business or a grocery business? I’d suggest it is a people business. The company’s greatest achievement has been building trust between consumers and their proxy shoppers. They leverage technology as a means of connecting consumers with personal shoppers to make sure what they want/need is what they end up with. It isn’t a bot or an anonymous someone but a trustworthy, named person on the other side of the application. They check in midway through a shopping trip, confirm choices and substitutions, and handle everything from selection to safe delivery. Instacart identified a real need. Customer experience matters, whether your consumer is shopping in-person or via a proxy shopper.
For fintechs, there is a lesson here. Just as Instacart improved the customer experience (CX) for consumers through technology and a human touch, so too can financial technologies better connect merchants and consumers. In the case of fintechs, increasing the trust between merchants and consumers comes by increasing the merchant’s ability to offer better service, options and support.
Brokering the relationship between a merchant and a customer should feel transparent, and the fintech should feel invisible. Merchants want to offer better customer experiences, and the fintechs that enable merchants to offer better CX will end up being much sought after. Merchants are busy, and learning how to use financial technology is not their top priority. Any ongoing training or guidance that makes the technology easier to understand, deploy and manage will pay dividends over time because merchants will feel comfortable offering it to their customers.
From safety to quality to accessibility, DoorDash changed the way people eat out. By creating an application that has optimized tracking, communication and status updates, DoorDash brokers relationships between restaurants and consumers. Everything is handled seamlessly. From the moment you order to when it arrives, there is nearly nothing for the consumer to do but track their food order from receipt to prep and delivery.
In financial technology, seamless transactions are essential. Think of Square. Square has made it possible for small merchants to take payments of all kinds. This has enhanced the experience for the consumer and given the merchant a trust boost. There is no interruption or confusion; it is a simple swipe, dip or tap of a card, and the consumer gets what they need.
As with DoorDash and Square, fintechs would be wise to focus on ensuring all transactions are fast and efficient. There is no time to bottleneck at a register or figure out how to use the payment application. Merchants and consumers need something smooth, simple, clear and, at times, contactless. Moreover, the product must be useful for everybody who walks through the doors of the business. You can’t offer just some people a payment option, for instance. All your consumers want to be treated equally and fairly, and any financial technology offering needs to work for nearly all people, nearly all of the time.
Serving Local Communities
Everyone recognizes that some things just need to be done nearby. Getting an eye exam, an oil change or a teeth cleaning would be tough to do outside driving distance. Fintechs can help facilitate the local reach of national brands, just like Groupon did. Groupon, reaching local communities with offers of interest, can partner with big-box retailers and national brands alongside Main Street merchants. As a subscriber, you receive offers that range from memberships to national gyms and branded sportswear to local teeth whitening services.
Similarly, with fintech, you need to balance big with accessible. Is your company accessible to Main Street service providers? Can you work with small retailers and national chains all at once? How are you able to drill into the local community?
Moving Forward Toward A New Reality
As the nation comes out on the other side of the pandemic, people will return in many ways to “normal.” But, there are some features of life adopted during the pandemic that feel like they’re here to stay. Consumer expectations are higher than they have ever been. People are now used to getting what they want, when they want it, in a manner that is convenient for them. Consumer brands have set a high bar that is likely to influence what people are looking for from other industries.
For financial companies looking to increase trust, adoption and lifetime value, the stakes couldn’t be higher. I see a hybrid of past, present and future realities taking hold and creating a new financial paradigm where trust, seamlessness and locality matter.
There is demand from consumers and merchants for fintechs to deliver their services quickly, efficiently and locally. Post-pandemic life involves the rebuilding of economies, including local transactions. The pandemic is a natural forcing function, motivating fintechs to deliver value to those on both sides of a transaction quickly and effectively — all while delivering superior customer experience.