Friday, 9 June 2017

I bank with Amazon

Are we headed towards a future where our key financial services provider will be a brand that started off by selling books online? 

Well, why not? With open banking becoming reality, any digital platform can become a bank. All that a good financial services platform needs is the ability to do three things: help people move their money easily, provide access to credit when and where they need it and provide value added services such as insurance and investment options. With an open banking system, any service provider can tie up with the best in each of the verticals and offer a bouquet which is quite literally, world beating. But my guess is that the brands that will win will be the ones with the best customer experience and not the most disruptive offering only. 

World of finance is daunting. It is pedantic and pedagogic. Undoubtedly, one needs more help and support to make a financial decision or even a transaction.

Here's where Amazon comes in. It is one brand that repeatedly tops every customer experience lists and there is a good reason for that. In his annual letter to his shareholders, Bezos wrote “Our focus is on customer obsession rather than competitor obsession, eagerness to invent and pioneer, willingness to fail, the patience to think long-term, and the taking of professional pride in operational excellence.” Undoubtedly, the company's obsession with customers makes it stand apart from its competition. Not only competition in its own space but other best in class brands from the services industries such as airlines and hotels.

This obsession will one day help Amazon beat any Fintech giant at its own game.

Typical Fintech companies obsess with data. With increasing computing power, there is a ginormous increase in the amount of data that can be collected from web browsing history, social media and now the fitness trackers and even internet of things. New methodologies and tools to analyse this data is emerging every day. Fintech companies focus all their attention on providing disruptive offerings by combining innovative business models, technology and big data. But are they as obsessed with customers as Amazon is?

If the Fintech companies want to win the race, they must look sideways at Amazon to pick up a tip or two which will help them stay ahead. A simple Google search will throw up 'n' number of articles on Amazon's superior customer service. But the three strategies that I find most relevant for Fintech companies are: 


1.Power of DIY service  

People who want to use a disruptive Fintech services are also most comfortable finding a solution most suited to their needs. Give people the power to find their own solutions. 

Amazon has an incredibly detailed yet easy to navigate Help Centre which lets people drill down to a number of specific concerns. While on the surface, the experience is streamlined to Amazon's overall shopping experience where people can search by category, under the hood, there are thousands of articles that help people find their own solutions.  






2. Power to reverse their decision 

People are scared of purchase decisions they make online. A 2016 study by Shippo showed that most customers checked the return policy before they make the decision to purchase an online product. 






The fear is more palpable among shoppers who purchase financial products which protect their long term needs. For example Insurance. Amazon has a no questions asked return policy which provides an immense sense of comfort to shoppers. While it has become a norm among eComm players today, Amazon started the trend in the market. 


Can Fintech players give people the option to reverse their decision without a heavy penalty? 


3. Power of personalisation

Amazon's personalisation is legendary. What makes them stand apart from everyone else is the way they can make people feel that they are dealing with a person where there is a connection, not just a transaction. Having access to Big Data is not the only answer. It is not good enough to have the right data and do the right things with the data. 

  

Amazon is a startup at heart. Their personality is that of an explorer while their processes are nimble. They swiftly move in and out of businesses. There is absolutely nothing stopping them (except the regulators) from becoming our key financial services provider. And when that happens, I will surely move my business to them. 

Monday, 28 November 2016

5 things to know about mobile wallets

On November 8, 2016, the Indian government announced that all Rs. 500 and Rs. 1000 notes of the Mahatma Gandhi Series would cease to be legal tenders from midnight. One cool outcome of this sudden move that's caught everyone attention is the spike in adoption of mobile wallets. While I used a mobile wallet as an in app feature in some popular apps such as Zomato and Uber, I had never really used one as a stand alone app prior to the demonetisation. Now that I am compelled to use one, I did some reading about mobile wallets to answer the questions which I had. You might find them useful as well.


1. There are many mobile wallet brands in India. What's the difference between them? 

There are close to 20 mobile wallet brands operating in India today. While by definition they are all mobile wallets, they can be broadly bucketed into 3 types:

The open wallets are those launched by banks or in partnership with a bank. These apps allow purchase of goods and services, fund transfers and cash withdrawals at banks and ATMs. Apart from payments to merchants, these apps allows the user to send money to a bank account via a linked mobile number.  Vodafone M-Pesa and ICICI Pockets are examples of open wallets.

Semi-closed wallets :  With this type of apps, one can deposit money into the app, pay affiliated merchants but cannot withdraw money from them. So the money one loads into the app will have to be spent. PayTM and Airtel Money are semi closed wallets.

Closed Wallets : This type of wallets are typically the ones such as Freecharge.  They are issued by companies to consumers for buying goods and services exclusively from that company. This type of wallets are popular with e-commerce companies.

2. What happens to the money which is preloaded?

When you opens an account with a mobile wallet operator, they opens an escrow account and deposits the money that is preloaded into that account. Only when you makes a payment using the wallet, does the amount get credited into the wallet operator's account. Neither the merchants or the wallet operator can access this money or benefit from the money lying in your wallet.

3. Why should I choose mobile wallets when I already have net banking facility?  

Making payments using a mobile wallet is far more convenient than using net banking. Money can exchange hands in matter of a gentle tap while net banking is far more tedious. Moreover, net banking is perilous, especially while making online payments as the entire account is exposed to a potential fraudster. While wallets do have a far less stringent authentication process but the money that is exposed to a potential fraudster is way lesser.

4. How safe are mobile wallets?
While I did not find any satisfactory answer to this question but my personal experience says that it does have its flaws where safety is concerned.  My primary concern is the authentication process. It is far more relaxed than every other payment instrument (of course, not counting physical wallets). Anyone with access to my mobile phone and its password can use my wallet to make a payment. On  a slightly paranoid note, the credit/ debit card information stored in the app can be compromised easily. While the RBI has laid down strict policy guidelines, I am not sure how much of these safety norms are really followed and what the checks and measures are.

5. How do mobile wallet operators make money? 

Each mobile wallet operator focusses on acquiring as many merchants as they can as their business model is based on commission from the merchants and payments for others apps such as Uber.

     

Sunday, 31 July 2016

Chasing Pocket Monsters

True to my character, I have been vociferous about my dislike for the game without really knowing anything about it. I felt chasing little monsters around the city was perhaps the stupidest thing one could do, ever. But now I am a convert. I changed my mind when I accompanied two avid Pokemon hunters in their pursuit. Why the change of heart? I am no gamer but I think its one of the most well designed games I have ever come across. It breaks most norms that a video game typically symbolises. (If you want to know the secret of this game's success, read this article  from the WARC blog.)


The 3 most striking features which made me jump in are:



1. It is an exercise app in disguise : The game rewards players according to how far they walk as one needs to walk a certain distance to catch more valuable Pokemon characters or hatch an egg. I will do anything to shed the extra kilos off as long as I don't have to stop eating or drinking. 

2. It is based on the principles of socialising: The lure module feature of the game brings people together in a physical location. I would like to meet more people in my area, especially if they are the types who chase pocket monsters in their spare time.  Well, why not? It takes all kinds to make the world.


3. It connects you to your city: You have to explore the city to not only catch different varieties of monsters but also land up in 'gyms' which are fictional arena like places that are mapped onto real life landmarks sprinkled around the city. Anyone who knows me at all, knows of my love for Mumbai and my penchant for exploring the city - with or without a reason.  


Come on, if you are a fence sitter, jump in! It is nothing like anything you have done in a very very long time. But oops, if you are in India, there is a minor problem. The game has not been launched in our part of the world as yet. Not sure what is Niantic, the makers of the game, waiting for but just in case you don't want to wait, here's how you can download it on your iPhone and get going right away!

Sunday, 1 May 2016

Selling Life Insurance In The Digital Age

One industry in dire need for an overhaul is the life insurance industry. With all the disruptions in the banking sector propelled by the fintech companies, consumers are going to demand a change in the entire process - from purchase, underwriting to claim settlement. With increase in young insurable population and their higher awareness about the need for protection and pension planning, insurance companies which adopt to the needs of the millennials will do better than the others who choose to stick by their legacy systems.

Currently all 24 life insurance companies in India offer online purchase option for their insurance products but none of them have adopted a digital mindset. Learnings from the success of the new age banks and banking products indicate that a true digital mindset offers new age products, services and solutions which are not available/ cannot be offered in the offline world. Simple hybrid models is not the answer for the future world.

To adapt to the future world, companies need to focus on 2 key aspects which form the backbone of this industry.

1. Customer Experience 
Currently fraught with mistrust and opacity, the customer experience across the purchase journey is an anxiety ridden one.  Any company that manages to completely re-look at the existing process with a clear focus on customer delight will win the day. P2P life insurance start up, New York based Lemonade have started on the journey to revolutionise customer experience by basing their processes on behaviourial science. They are betting big on it to help them improve their underwriting and overall claim response and processing time to improve their policy holders' satisfaction level. To adapt to the new age, life insurance offerings and processes need to have a focus on transparency, agility and most importantly, intuitiveness built into their mindset which will automatically reflect in the way they do business.

2. Personalised Underwriting
With mountains of data easily available, companies which offer personalised underwriting (differentiated pricing depending on an individual's lifestyle) to the millennials will definitely win at the end of the day. This generation will be happy provide access to their personal data if they stand to benefit from it. By partnering wearable devices, companies will no longer have to rely on static data provided at a point in time but can continue to monitor their customers' behaviour overtime to provide a risk cover which is a win win for all parties concerned. Motor insurance companies in the US have already started adopting technology for underwriting. Once customers experience personalised underwriting process from general insurance companies, they will demand the same from their life insurance providers.

I can't help but wonder, in 2020 and beyond, will life insurance companies face competition from e-commerce companies such as Amazon and social media giants such as Facebook who are proficient in data mining and even more proficient in analysing what customers want and providing them with a solution which is not only convenient but also fast. Look what Uber did to the public transportation system!

I believe that adapting a digital mindset for the life insurance industry is far trickier than other industries. The industry not only needs to re-look at their business model but also their age old belief system that insurance is not bought but sold. The one thing that Millennials dislike the most is being sold to. They prefer to buy what they want, when they want and at a price they want it at.  

Sunday, 13 March 2016

There is suddenly a tsunami of wrists around me with bands around them literally screaming " I am a health conscious freak". Funnily I notice these bands less often in the gym and more often at pubs when the wearer holds up his beer mug to his mouth. That led me to wonder why do people really wear these? Do they really look into the data that these devices are generating? Are they really making lifestyle changes basis their analysis of the data?

I spoke to a couple of people who wear these bands religiously and presenting the 2 most interesting quotes which encapsulates what almost everyone else had to say : 

"My wife gave me this band. Looks cool, doesn't it? Since now I see the time on my mobile and I don't need to wear a watch, I decided to wear this cool piece of tech around my wrists." 

"Yup I do go through the data. I ensure I do the 10K steps I am supposed to do. It allows me the extra beer in the evening." 


Interesting to know that these gadgets are at worst props to make people look cool to at best being a permission device that allows an extra drink in the evening because you have been good all day. 

What a waste! I wonder why aren't health insurance companies jumping in at the opportunity and linking the data to the cost of insurance premiums or health apps using it to signal an impending heart attack? 

Wednesday, 10 February 2016

Dating Apps

Technology is fundamentally changing the nature of relationships all over the world. The online dating industry is a 
$2 billion powerhouse growing at a rapid speed, fuelled by dating apps such as Tinder, Truly Madly and OkCupid.
A study by Pew Research Centre says that people’s attitude towards online dating is on an upswing. Only a minority view online dating skeptically.

Those out to play the mating game love these virtual toys as the location based mobile apps virtually put every single person within a certain geography at their finger tips. Come on, regardless of one’s relationship status, who wouldn’t want to know all the eligible hunks and sexy sirens in the neighbourhood?

Influenced by the growing chatter on the Internet I downloaded one of these heaven sent marvel to satisfy my curiosity and was absolutely gobsmacked by the ease and simplicity with which one can choose a potential mate. Based on the principles of gaming, these apps have been designed to keep people hooked on for hours. They provide a high to the users as the brain releases dopamine - a kick ass chemicals in the brain that makes one feel happy every time there is a positive affirmation. Not to forget the reward - opportunity to have at least one casual encounter for every mindless minute spent.  

Call me archaic if you will, but I am not a huge fan of these apps. I think these are just temporary entertainment of mindless and superficial date selection. I just can’t get my head around to the fact that why would anyone want to be a thumb swept sexual conquest? (Sorry, but that’s what it finally boils down to.) I have grown up believing that fun of the hunt is in the chase. The instant gratification of a right swipe, bereft of any emotional intimacy leaves me cold.  

Fans of these apps rave about the 'huge opportunity' of meeting people who they would like to casually hook up with / date/ get into a relationship with. But my humble point to those blocks is that an ‘opportunity’ is supposed to be exciting because its rare. With options aplenty, is it really an opportunity?  

Regardless of how I feel about it, in this techno-sexual era, mobile app based casual hook up is a part of mainstream culture and is here to stay. I should just accept it, wear my marketing hat and get busy thinking of ways to leverage this 'huge opportunity' for my brands.  








Saturday, 6 February 2016

New Age Recruitment

Rather uncharacteristically, I am watching the IPL auction in progress. As the process unfolds, it  triggers a thought.

This is 2016. Most people who are really good at their work, no longer want to work for an organisation. 24 year olds today prefer to throw caution in the wind and either freelance or set up their own companies to offer some crazy service or product. Some succeed. But those who don't,  seldom hesitate to start all over again. But none of them ever want to join a regular workforce if they can help it as they consider a regular 10 to 6 job a compromise choice.

While I salute the hungry go-getters, as a manager, I worry. A year or two down the line where will we get good talent who make all the difference?  Perhaps, the corporate world too will have to bid for talent in an auction on a project to project basis. Alternately, we will have to let our best talents take leave for three months to work on a project of their choice in any company who will 'buy' them for the season.

Will  #JobAuctions become the  next new age recruitment policy? #PointToPonder