This month Lucian asks if technology can drive change in how clients deal with their finances
It started, as I recall, with a Fitbit, setting off that increasingly obsessive focus on its 10,000-steps-a-day target. But that was just the beginning. Now, it’s been joined by a whole screenful of health and fitness apps – measuring heart rate, sleep patterns, quality and quantity of gym sessions and every possible aspect of diet and nutrition.
Those who know me will realise that I’m not talking about my own experience. In fact it’s my son Oliver who – I believe in all seriousness - monitors and manages his personal health and fitness quite literally more closely than NASA monitored and managed the first moon landing 50 years ago. Ollie is by nature a bit that way inclined, but ultimately I think he does all this for one key reason: because he can. Because it costs him little or nothing, and because the apps are easy to use, and because if you are a bit that way inclined it’s all quite interesting really. All of which begs the question: will similar, or equivalent, technology encourage many of us to develop the same sort of microscopically-detailed relationship with our personal finances? And when I say “many of us,” what I really mean is “many more than the small minority who’ve always been that way inclined.”
Already, it’s looking very much as if the answer is “yes”. Exhibit A is Monzo, now claiming to have passed the 3-million-customer mark on the basis of a hybrid proposition that combines a broad and powerful suite of free financial health and fitness tools with that famous coral payment card. I don’t know how many of the three million are using the tools, but it’s a lot – and they’re not by any means all the kind of middle-class, middle-aged, male financial hobbyists who generally jump at new opportunities to play around with their personal finances.
Meanwhile, another big success story is ClearScore, which admittedly has made its customer acquisition challenge a great deal easier by giving away its service for nothing, but in a very short time has managed to persuade millions of us to sign up for a monthly email telling us that our credit rating hasn’t changed since last month. And then of course we’re still right at the start of the Open Banking era in which thousands of app-based service providers are on the point of introducing us to their own special ways of exploring the detail of the dire state of our finances. (Most of these, as I’ve grumbled on many occasions, will have hopelessly inadequate marketing and communications budgets and so will fade from the picture without having ever introduced anything much to anyone, but there are sure to be some survivors.) I am deeply cautious – and on the evidence to date rightly so – when it comes to getting excited about big, broad and important changes in consumers’ financial behaviour. In my 30-odd years in financial services marketing, I can only think of two: shopping around for insurance, and, much more recently, switching from cash to cards even for small day-to-day payments. Both of these two big changes have resulted from technology that makes them easy and obvious things to do (price comparison websites in the first case, and contactless cards in the second). Judging by Ollie’s health and fitness journey from those early Fitbit days onwards, it looks to me as if for many people, personal finance micro-management is going to be the third.
Lucian Camp is Managing Director at Lucian Camp Consulting. To find out more, or read some of Lucian's other musings, visit www.luciancampconsulting.com.