The Rise Of Digital Banks and The Value In Remaining Tangible

by Dane Whitehurst on 09/10/2019 | 5 Minute Read

People have always had a turbulent relationship with banks. Tensions were perhaps most strongly pronounced a little over a decade ago during the most devastating financial crises many people can remember. While families were losing their homes and struggling to feed their kids, much of the blame centered on the banking industry as a whole.

People were angry and wanted out, but what choice did they have? 

Many agree that these conditions created the perfect storm for a new age of banking, one that would ultimately herald the rise of the digital challenger banks.

These organizations, which offer an alternative place to safely house and manage personal finances capitalized on the disillusionment of customers, and tailored their brands to represent hope, freedom and choice. They offered a radical departure from the establishment, and today, the most successful of these are pulling business away from larger, long-established institutions. 

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These new banks don’t necessarily offer higher interest rates or other fiscal incentives, but they do have services that appeal to the needs and desires of their core demographic of millennial and Generation Z customers; crypto exchange, travel insurance, fee-free foreign withdrawals, push notifications and even airport lounge access, all immediately accessible from your smartphone of choice.

And they offer a customer experience that is in keeping with the way young-to-middle aged people manage the rest of their daily lives. Digital banks, as the name suggests, have focussed on offering a quality user-experience through their digital banking services. They operate predominantly on a mobile platform and are therefore forever present and accessible to their customers. Their apps and connected services are a masterclass in UX design, light-years ahead of most high street banks. 

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With the phenomenal rise in the number of UK challenger banks in the past two years alone, it is a testament to the strategic success of their campaigns that a recent census wide study found that one in four millennials are using digital-only banks. Furthermore, across all age groups, 14% of UK bank customers now have at least one mobile-only digital banking provider. 

But how did they convince people that they could offer something different?

The fintech space was quick to realize that marketing wasn’t about reaching customers; it's about reaching communities and individuals.Their billboards and social media campaigns focus on lifestyle, liberty, transparency and freedom of choice. They have become the aspirational voice of the younger generations and in doing so have re-entwined the broken threads of a previously damaged relationship. In a frequently impersonal digital world, fintechs have managed to make banking personal again.  

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Together with their on-point marketing campaigns, pioneering brands have focussed attention on the rare physical touch-points they share with their customers. In the world of digital banking where so many aspects have become less tangible, the physical card and its packaging have become vehicles not only for physical engagement but for cementing brand values and welcoming people into the fold. 

In this industry, the plastic card isn’t just a bank card, it's a membership card, and in the absence of a handshake, the way it's presented through packaging fundamentally defines the first, "Hello, welcome to the club." 

Consequently, fintech companies have been pushing card suppliers to create more engaging, innovative cards and are working with forward-thinking packaging design companies to deliver creative ways to present them. Packaging in this space often includes dynamic and innovative packaging mechanics and a wealth of high-end materials and surface finishes to plant them firmly in the premium packaging category. 

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Companies keen to make a brand statement or frame a new product feature have seized on the opportunity that packaging presents to captivate an audience. Some of the proprietary pack mechanics developed by Burgopak include a unique design for Ditto where customers interact directly with the logo, a rotating a door to "unlock the card," sliding and telescopic packaging that reveals the product alongside a poignant welcome message, and an award-winning hexagonal format for Crypto.com.

New designs are also on the horizon including "The Revolver," a greeting card style design that automatically rotates the bank card when the pack is opening and "The Ejector," which is a simple envelope with an incorporated ribbon that subtly ejects the contents when pulled.

Physical touch-points have become a powerful weapon in the fight for brand equity and ultimately market-share in this thriving and competitive market. Another easily overlooked and yet incredibly valuable peripheral benefit of these physical manifestations of the brand, is that they also act as miniature billboards that form part of the fabric of daily life both in the real world and online. Iconic payment cards are instantly recognizable when flashed across a counter-top, and great packaging has become the perfect focal-point for viral social media campaigns and online marketing. Similarly, these tools, when placed in the hands of the right influencer, can quickly rack-up millions of views on social media, cultivate buzz within online communities and generate exposure for next to zero spend.

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Packaging gives digital banks a physical presence and has the potential to elicit a memorable tactile touchpoint in retail, in the home, and wider social and industry communities. The return on investment for the time, energy and perhaps a little extra cost that goes into developing stand-out packaging, is in cementing the brand values of predominantly digital service providers in the real world and in creating beautiful, shareable assets through social media. 

Packaging as a physical marketing tool has become a personal billboard for the influencer in us all. We all seem to feel the need to share the things we find most beautiful, and packaging gives brands the potential to reach far beyond their sphere of influence. 

In a world where advertising is inescapable, the result is still mass exposure, but in a way that feels more subtle and based on choice (we choose who we follow and what we search for), and this helps us to retain a sense of control; we continue to consume, but we feel less like one customer amongst many and more like an individual within a personally curated community.

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