The 4 Ps of marketing – product, price, place and promotion, need to be redefined in this modern age, with a few additional principles. One of these principles is identifying the consumer segment. Identifying the target customers for a FinTech product, how they evaluate and buy a product, is important for the success of a start-up. The FinTech sector lags behind traditional financial institutions in terms of marketing budgets. Unless they are able to classify the target audience and build content especially suited to them, conversion rates will be lower, which means customer acquisition costs will go through the roof.
Valentin Stalf, chief executive of German financial services startup, N26, maintains that it is not only the millennials who want to engage with FinTech products. People of every age group are looking for simple and seamless financial transactions, and the FinTech sector is thriving due to the inability of banks to customise products to the consumer’s needs. So, the target audience for FinTech is broader than we think.
A Unified Marketing Brief to Identify the Broader Audience
Many companies have created structured documents to provide answers to vital questions regarding their business. One of them is having a unified marketing brief. The first thing to identify about the target audience is their demographics. It would be wise to not start with a narrow group straight away. Start broad and then get more specific at a later stage. The gender, age, location, job role and budget are a few parameters to consider. And, don’t be in a rush to eliminate senior citizens.
There are plenty of examples where FinTech products have been able to address the needs of seniors. For instance, OceanFirst Bank has introduced a video-teller facility to help the elderly conduct financial transactions conveniently. It is one of the many digital tools in the market that have helped reduce physical barriers and helped families prevent elder fraud, the market for which is only expected to grow. Of course, each product is different, which is why it is essential to understand your own product first; what problem areas it addresses and how easily it can be understood.
Targeting Existing Customers and the Channels They Engage With
If the company already has customers, evaluating their behaviour could provide insights into the target segment. The sales team will have relevant figures related to this. Look at the online channels where customers engage with the brand most often. Is it through social media? Or is it through your blog articles? Evaluate the conversion rates of your landing pages. Another way to go about this is to create customer surveys.
Competitive Industry Analysis
It is important to identify your company’s standing among its competitors. Evaluate how your products differ or mimic rival products. What features can give your firm a competitive edge? In simple terms, why should a consumer choose your product over that of a competitor? When you have successfully identified your competitor, take a look at their websites and their marketing strategies.
Who are they targeting and through which channels? Go through their websites, advertisements and other offers; you could even subscribe to their newsletters.
Competitive analysis will help you understand consumer behaviour in your industry. You will be able to understand and decide on the pricing of your product and the technological additions that you need to integrate.
Predictive Analysis and Data Science
By creating centres of excellence for robotics and analytics, Yes Bank is gaining valuable customer data and shaping their products in a way that can add value to the customer experience. Their Alliances, Relationships and Technology (ART) strategy, combined with the set-up of a FinTech accelerator, has enabled the bank to achieve 111% growth in credit card transactions and 2,576% growth in wallet partnerships.
This indicates that even traditional banks are using predictive analysis to identify customer segments and their requirements. Predictive analysis was considered the forte of FinTech firms until recent years. Data analytics platforms can also help identify many untapped market segments.
FinTech start-ups need to have a system where they not only identify the target audience, but also capture valuable feedback. Product feedback has to be converted into actionable improvements; only then will the customer recommend these products to their peers.