Lifestyle brand for financial services

 






Author: Mikko Kähkönen, Global Card Product Manager, Giesecke+Devrient


July 26, 2022

In recent years, global brands have resonated with consumers to such an extent that they have become a way of life. Last year, Apple brand loyalty hit an all-time high of 92% as the tech giant focuses on delivering unique customer experiences and the promise of continuous innovation. As such, groups of like-minded people identify with the company’s purpose and vision, naturally becoming strong advocates. Financial services can use this positive word-of-mouth as another form of marketing to build, interact with, and grow from their own evangelistic community, in much the same way that technology companies have benefited from this growth in the past.

Lifestyle branding has grown among younger generations like the digital native Gen Z, as they promote self-expression and listen to influencer recommendations. While TV advertising and shopping defined the pre-social media era, it is social influencers who are shaping the buying decisions of the next generation, with the market growing from £1.7bn in 2016 to a staggering projection of $16.4 billion this year. It is perhaps unsurprising that the world of finance is looking to take advantage of this trend. Branding expert Apple has even ventured into this space by introducing a one-of-a-kind titanium credit card to allow consumers to benefit from individuality in their lifestyle. With customer experience at the center of these strategies, how are banks and fintechs venturing into lifestyle banking?

Design is key
It’s important for banks and fintechs to focus on a holistic and engaged approach that improves the customer experience, and there are many examples of a successful strategy that puts the customer first. Monzo is an example of an app-based challenger bank that seeks to disrupt the traditional way of banking as the company emphasizes the demands of its customers. Its ultra-colored bank card gives it a distinctive look. The bank’s head of design, Hugo Cornejo, described it as an intentional gesture to grab people’s attention and create discussion when they are handed over to make purchases.

This strategy reflects a brand that truly understands its desired customer base. Understanding consumer motivations will allow banks and fintechs to select the right design elements for their bank cards, as these are the physical symbol of the lifestyle they promote.

This is just one example of how a card can amplify someone’s lifestyle. The design could reflect exclusivity, innovation or sustainable practices for customers who wish to support green initiatives. For example, a metal card withstands hectic lifestyles; it is defined by its longevity and ultra-sleek design. Eco-cards made from 100% recycled, ocean-sourced or bioplastic may also resonate with environmentally conscious consumers, which is particularly crucial as a 2020 report found that 73% of the Generation Z were willing to pay more for sustainable products. Another study also found that nearly 90% of Gen X consumers would be willing to spend 10% more on more sustainable products.

Besides design, communication with consumers is essential, with social channels now a key medium for sparking conversations with young customers. For example, the launch of US digital bank Step was promoted on TikTok by top influencer Charli D’Amelio and garnered endorsements from celebrities such as rapper Nas. For younger consumers who aren’t interested in finance, harnessing the power of social media and influencer marketing will help them resonate with their interests.

Alongside bank cards that are impactful and sustainable, but also customizable according to the consumer’s personal tastes and interests, digital applications will enable effective online experiences as part of a combined “phygital” approach, where digital and physical experiences come together. This will be critical as more and more consumers decide when they want a physical or digital touchpoint, with the bank located where the customer is.

Take a holistic approach
For banks looking to build a successful lifestyle brand, the key is to fully understand their consumers and improve the user experience by taking a more holistic approach. The most successful banks understand their customers’ aspirations, speak their language, know where they “hang out” online, and offer personalized and unique products and services that resonate and are instantly recognizable. Effective use of available data could certainly help gain valuable insights into customers, their behaviors, motivations, and interests. The subsequent building of a strong image, targeted products and the use of relevant personalities will put banks and fintechs in much stronger positions to attract new customers and ensure their loyalty and advocacy in the future.

Stephen V. Lee