Growth Drivers for Fintech Startups

Many fast growing fintech and financial services companies that we encounter lack the in-house marketing resources and time to drive growth and catapult their company to the next level. Despite the challenges, there are a few basic, strategic tactics that you start with to help drive growth, and it all begins with breaking down your target audience, customers and prospects, by segment and stage.

Defining your market

Market definition and segmentation can be difficult for many organizations because their products or services may cut across broad groups of individuals or companies. A key to useful audience segmentation is looking at how individual prospects make buying decisions, choose to purchase from you, and what similarities or differences exist in the buying process.

• How do they decide to make a purchase?
• What factors into their decision?
• Who are the individuals (or champions) involved in the decision?
• Is it one person or multiple people, and to which resources do they turn to help them make a decision?

We leverage interviews with key members of the sales and product teams, sales data, web data, and secondary market research to understand the distinct buying processes that occur around our client’s products. Once we start to map the buying processes, we can see that the audience naturally starts to form into audience clusters based on similarities in how they buy. This forms the basis of your audience segments and allows you to develop very targeted messages that appeal to these distinct segments individually.

Messaging

Market definition and segmentation sets the stage and is just one part of your fintech growth marketing foundation. The second piece is your marketing messaging.

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We’ve got zombies on the brain here at CSTMR, and not just because of the recent mid-season finale of The Walking Dead. As we brace for the hordes of virus-infected undead to storm our televisions again in a couple of months, we’ve been thinking about marketing zombies. You know, the campaigns you keep funding even though they’ve long ceased to have a pulse.

Companies that constantly monitor their campaigns don’t lose money. Instead, they identify their weaknesses and pivot to more profitable tactics, and do so quickly. But those that funnel money into strategies that have hit a plateau or have declining results? They’ve got problems, as they continue to pour money into campaigns that are already dead, they just don’t know it yet.

Build the following three components into your strategies and you’ll avoid marketing zombification:

Diversity

Even the best articles and most brilliant ads can’t thrive in isolation. Media mentions are great for early-stage startups, but you can only milk those for so long. You can’t scale your PR efforts 100 times based on articles and interviews alone. Different channels should complement and support one another. If you have an avid Twitter following, use your influence to breathe life into some of your under-appreciated articles or videos.

The nice thing about digital marketing is that you have tight feedback loops, so you can see when SEO results decline or customer acquisition costs increase. When you have multiple channels in the mix, you amplify one while retooling another.

Think of each division as an oil well. Imagine that your PR department gets an article placed in The Wall Street Journal, and you gain exposure in front of more than 2.5 million people.

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The Empire Startups Fintech Conference at the Great American Music Hall in San Francisco launches next week, on Nov. 10. This is the inaugural west coast event, bringing together more than 180 fintech companies, investors and others in the fintech community.

For those attending, it will be an action packed day of blockchain and borrowers, payments and partnerships. With all of these great fintech minds under one roof, there are some panels and companies we definitely recommend checking out, and some in which we’re interested in finding out more. So without further ado, here’s our ‘Recommendations’ for the panels we’re looking forward to at the show and our ‘Question Marks’ for panels that could be interesting if they stay focused, but could also turn south if things get off track.

RECOMMENDATIONS

Cash is Dead
9:30am, featuring Marqeta, plastiq, Square, Core Innovation Capital, Mastercard
With a strong lineup of panelists, this session promises to kick the day off right. These leading companies are all dealing with the here and now of changes in the payments space, rather than a distant and uncertain future, so they should bring a uniquely qualified perspective on the state of payments.

The New UX of Fintech
3:00pm, featuring Yodlee, Bento for Business, LendUp, NerdWallet, Alchemy50
As fintech marketers and designers, UX for Fintech is a subject near and dear to our hearts. With companies like Bento, LendUp and NerdWallet that spend a lot of time considering the intersection of design, communication and effectiveness in customer interactions, they should have a lot of insight to offer.

The Growth of Lending
3:40pm, featuring Ldger, Sindeo, TrueAccord, Fundbox, SoFi
We had a chance to see Ldger at Finovate Fall and Fundbox at Money 20/20,

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What happened the last time you told someone you work in financial services? Did their eyes glaze over, instant boredom setting in at the thought of crunching numbers and soulless database systems?

Start talking business loans or investment options, and you suck the life right out of a room.

People associate numbers with boring, calculated deal brokering. And who can blame them? Even for those of us who work in the industry, talking technology and money all day can make us forget that finance isn’t an emotionless trade.

Money is an integral part of people’s lives, the thing on which their mortgages, vacation plans, college funds, and annual Christmas parties rely. Put it in those terms, and you’ll see all kinds of emotions arise.

And therein lies the challenge for fintech marketers. Too often, they approach B2B clients in cold, hard terms, talking interest rates and banking security systems as if they’re divorced from customers’ everyday lives. In reality, if you’re in fintech, you’re in just as deep as your consumer-facing clients.

Both B2B and B2C clients want to know that fintech vendors get it. They need to be sure you can provide them with the right technical support and that you’re along for the journey. Finance may be a fact-driven industry, but buying decisions always come back to emotions.

Marketing to Captain Kirk

If people based decisions on logic alone, there’d never be need for deliberation, and there wouldn’t be much room for marketing. The specs would speak for themselves, and the most efficient and cost-effective companies would have monopolies on their industries.

But we can’t all be Mr. Spock and operate on logic alone.

Most people are similar to the more emotional Captain Kirk,

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Two weeks ago, we reviewed lending trends, and last week we looked at 3 payments (plus 1!) trends to watch at Money 20/20. This week, we turn our attention to security.

Today’s Topic: Security

If there’s one certainty in financial services, it’s that every new service will be accompanied by new ways to commit fraud. The massive proliferation of online and mobile services has led to an equally massive number of attempts at hacking those services. Luckily, those black hats have also spawned a new breed of sentries at the gate. Here are three trends in security to look for at the show:

1. Tokenization making moves – What massive hacks like the Target breach have highlighted is the danger in having a single card number that, when breached, can be used with relative impunity until the fraud is discovered. While technology like EMV is great for protecting your physical card, tokenization helps in card not present transactions. Tokenization involves substituting a card’s Primary Account Number (PAN) with a unique, randomly generated sequence of numbers, alphanumeric characters, or a combination of a truncated PAN and a random alphanumeric sequence. Tokenization is nothing new, but there are new applications that make it more accessible and easier to implement. Able to stunt the ability of ne’er-do-wells to exploit your information and spurred on by the growing number of mobile transaction types, this is certainly a technology poised for wider adoption.

   Companies to watch:

   • Abine (www.abine.com) combines financial, email, and password protection together into their Blur application. With flexible security options, users have the choice of selecting their real card number or a “masked” card number for transactions.

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Last week, we looked at 3 lending trends to watch at Money 20/20: alternative SMB lending, subprime/no credit lending and property lending. This week, we shift our focus to payments.

Today’s Topic: Payments

Payments represents one of the largest segments of fintech in terms of new investments and number of start-ups tackling the thorny issue of paying and getting paid. Payments is a big, broad space with a wide range of products and services. We identified three payments trends to watch at the show:

1. Alt Pay services on the rise – “Alternative payments” means different things to different people. To us, alt payments encompasses any payments outside of the traditional channels (although what really is traditional any more?). For example, there has been plenty of coverage of bitcoin and for a while it seemed a trendy new cryptocurrency was launching every week. Now these alternative payment companies are making a go for more legitimacy.

   Companies to watch:

   • Blade Payments makes legacy payment rails interoperable with blockchains and makes crypto-currencies backwards compatible to traditional debit cards. While there is no shortage of bitcoin plays, their tie-in with traditional payment types is particularly interesting.
   • FuturePay is really a lending play in payments clothing. They offer a “credit tab” that can be tapped to pay for items, as an alternative to credit cards. If they can get enough retailers onboard, it could be an interesting option.
2. Payments-as-a-Service becomes (even more) commonplace – Rather than integrate with multiple payment services individually, “Payment-as-a-Service” providers usually offer access to multiple payment types through a single interface or gateway. These companies can come in a couple of different flavors –

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