23 October 2017
Financial UI UX design by UXDA
Alex Kreger

Financial UI UX design by UXDA

Alex Kreger - UX Design Agency

11Posts 116,861Views 9Comments
Innovation in Financial Services

Innovation in Financial Services

A discussion of trends in innovation management within financial institutions, and the key processes, technology and cultural shifts driving innovation.

User Experience Design and Behaviour Psychology Can Grow FinTech and Banking Products Sales

12 June 2017  |  12962 views  |  1

Every day, millions of people, both offline and online, do not make their desired purchases. Unfortunately, financial services is no exception. Let's try to figure out how businesses lose prospective customers who are willing and ready to pay for goods and services and how you can prevent this to grow your sales.

 

Many years ago, I drastically changed my career field and started to work at a digital IT agency. Back then, our team believed that the most important thing was a stunning and trendy interface that meets technical requirements. Therefore, the search for inspiration was the most important part of our work.

Everything was fine until one of our customers complained that, after redesign, sales through his site had decreased. Nobody understood how this was possible because we made his online services much more appealing with world-class design.

However, we obviously missed something. Thinking about this problem on my way back home, I went into the supermarket because my wife asked me to buy yeast for the dough. Entering the store, I automatically went to the spice aisle, but, to my surprise, I wasn’t able to find the yeast there. After a moment's thought, I continued my search at the dough shelves, but to no avail. Perhaps it was next to the chilled dough in the refrigerated section. Again, nothing there. Asking a sales assistant also failed because knowing the exact location of one of the 20,000 goods obviously  wasn't so easy.

The funny thing is that this multibillion-dollar trading industry turned out to be useless in the face of the lack of intuitive goods navigation at the shop. I felt angry about my helplessness and stupidity in the situation. I understand that the store carried yeast, but I couldn’t buy it!

Suddenly, I realized that we were facing the same issue in the IT world. A user of our digital services may be interested in purchasing a product or service. He/she might be enthusiastic about the design but, perhaps, couldn't cope with obstacles on the way to the purchase. This is exactly what happened to our customer. A beautifully artistic design on the website began to disturb users instead of encouraging them to place an order.

As time went on, I uncovered a long list of similar cases. For example, one time I decided to order sushi and went to the web page of a restaurant that my friends strongly advised me to try. In order to see the ingredients I had to click twice on every dish that interested me. After 40 clicks and 20 minutes of wasted time, I had finally made my choice. Suddenly, I realized that this site did not have a basket for orders. How can I place the order? Users had to remember specific names like ebimaki, karaiidzumitai and kanagawa and then call the restaurant and order the selected dishes in the right amount.

Well, what can I say? Maybe, offline, this restaurant is not so bad, but the owners сould discover a lot of growth opportunities by perfecting their online orders. My purchase, of course, took place that day, and I did not die from hunger, thanks to another restaurant. I'm sure everyone has experienced similar situations.

On that day I realized that the traditional approach of creating digital products does not work. Despite being new to the industry, I could not accept that the result of our work depended on the inspiration of the designer or the requirements of the technical system.

I realized that our work should bring real benefits to the business, and this became a real challenge for my team. We found the solution, and today we use it to design financial services worldwide. But the most surprising thing is that I had used this solution before I started to work in IT,  without even realising that.

Before I started to work in the digital solutions industry, I achieved some success in retail. During my work in wholesale trading, our brand competed with companies that allocated significant funds for television and print advertising. Our budget was insufficient to use mass media advertising.

We chose the "below the line" strategy and directed all available funds to work with specialized stores, limited by our distribution range. Stickers, posters, price labels, wobblers─these were all our available weapons. Nevertheless, a miracle happened. Our turnover increased by 60% year over year! And, after a few years, we entered the market as leaders.

The next industry in which I worked was real estate, and a similar story occurred. The competing agencies had a serious advantage. They began to work with new residential segment developers several years ahead of us. By the time we entered the market, they already had dozens of contracts with developers, hundreds of clients, numerous advertisements and even their own development projects. Nevertheless, in just two years, we created the largest real estate agency on the market for the sale of new apartment buildings. Virtually without an advertising budget, we had 150 projects on sale and customers waiting in line.

I have a degree in psychology, and I had to refresh some of my knowledge in order to connect all these dots together. After all, for some time, I was inclined to chalk it up to incredible luck until I found an element uniting these stories. This element directly affects the efficiency of any business and now lies in the heart of each digital solution designed in our UXDA company.

Let's get back to the situation in which I could not find the goods in the store. Now imagine that I came to the store, and there is only one shelf with this one product on it. The purchase would be quick and pleasant, wouldn't it? But, in real life, we ​​have a few thousand products and options, among which you need to find the one that meets you needs.

The critical aspect is in the “search and find” activity. In general, the search activity is the basic mechanism ensuring the evolutionary survival of mankind and other living beings. At the dawn of humanity, those who knew how to search for food, shelter and a partner for procreation had the best chance of survival.

Ironically, the relevance of this principle has grown significantly since that time. The amount of information around us is increasing at warp speed, but there are still more questions than answers to be found. Throughout life, we need to look for work, customers, ideas, employees, like-minded people, the right products and many other things. There is a clear match between success and a good search with analytical skills.

In fact, many of our achievements are due to the fact that, at the right time, we were able to find something faster and more efficiently than others. The more easily we can find effective solutions and opportunities in a modern society, the higher are our chances of success.

Any search process involves several stages and is essentially cyclical. A person finds options, chooses criteria for comparison and constantly narrows the field of choice, until he stops at the optimal solution (in his opinion).

Thus, the key element that we need to consider is the user's search behavior. Manufacturers of goods can create spectacular packaging design, formulate stunning descriptions of advantages and provide high-quality product, but if I cannot find the goods in the store, it's all useless. The same applies to digital financial services.

The traditional approach to the development of products and services is trying to influence the emotions of users in order to attract their attention through appealing design. This is categorically not enough to initiate a customer purchase.

It is important for us to understand the behaviors and needs of our users. Priorities play the most important role here. There can be many needs, but, for most people, the most important are usually just a few. And you could identify them with the help of statistics and observations.

In respect to the world of  digital financial design, if a visitor comes to your site to request a loan, do not tell him about the news of your bank or startup. Show him credit products, offer a calculator for quick evaluation of opportunities and an online form for a remote application. Make his search for a solution instantaneous and extremely simple.

As you remember, I wanted to order a meal online, and, instead of getting help, I encountered obstacles. In the end, I purchased my meal at another place, at which it took only a few clicks and five minutes of my time. Do you think the first restaurant lost just my order? No ─ it likely lost a dozen times more, possibly my as a customer lifetime value plus referrals. And the second restaurant, accordingly, acquired it.

Understanding users’ search behavior becomes a key element in achieving success in the areas I worked prior to IT. Making a bet on the below-the-line advertising at the point of sales, instead of a mass media advertising campaign, we influenced the users directly at the moment of making the purchasing decision. Dominating in the visual space of most specialized stores, our brand attracted visitors’ attention, engaging and providing a clear answer to buyers in the process of their search. This also strengthened the positioning of the brand as a professional product, not just mass market merchandise.

In real estate, the search activity of buyers was complicated by the need to select and compare among a large number of proposals. This required communication with a huge number of RE agents and analysis of a large number of criteria. We took this burden on ourselves by offering customers one-stop RE consulting and 150 projects to choose from, thereby greatly facilitating their search. And that was exactly what the customers needed.

Realizing the need for a scientific, client-oriented approach to design-effective digital services, I found that there already exists a methodology that combines psychology and technology─UX design. The main element of this methodology is the targeted alignment of positive experience with the technological system. In other words, this is a way to make the customers’ search process fast, pleasant and convenient with the help of digital services.

For several years my team studied over 1,000 articles and books on UX and usability. We found hundreds of case studies and conversion rate optimizations. Most importantly, we conducted our own experiments and collected data on the basis of dozens of client projects.

This led us to a discovery that changed our world. Everything fell into place. It seems that effective services are built according to a certain formula, and it precisely guides them to a high return on investment (ROI).

We have discovered an important definition of an effective digital service. It is a service that brings success to business, matches its goals and promotes growth. To satisfy user search activity, in this case, is not the goal but the tool. Thus, for the design of an effective digital solution, a balance between the interests of the user and of the business is needed.

At the same time, we must take into account that the design of financial services is not limited to the interface; this is just the top of the iceberg. Interaction with the service occurs at different levels. At the bottom stands the core of the system. Its automated algorithms perform query processing and information exchange.

Digital product does not exist by itself; rather, it is based on a deeper level─organizational business processes. Therefore, to digitize the financial institution with a thoughtful and appealing interface is not enough; the development must capture all levels. After all, a user-centric service is created at all levels.

Of course, each organization has its own characteristics and goals and not necessarily financial ones. But there is something in common among all organizations. Any organization is in one of two states─growth or failure. Healthy organizations are always striving for survival, and therefore the main goal that all services are facing is to promote  growth for their organizations.

So, in general, to create a successful service, we take into account the goals, features and strategy of the business, the behavior and needs of the user and the technological capabilities of the product and its features.

The business, the user and the product are the key elements  on which the development of the digital financial service should be based. Those elements should be investigated on all levels. Based on the data obtained, the strategy of the digital service, its role in the company's business processes and connection with the user's search behavior is formulated.

To implement this formula and structure this process at all three levels, we recommend using the Design Thinking approach and UX design techniques.

 

Main takeaways

In conclusion, let's recall the lessons I learned from my story that UXDA is now using to develop user-centered financial services:

 

1. Define the criteria for the effectiveness of a digital product for your business

Ask yourself a few important questions. Why is your business developing a digital service? What business processes will it be connected with? How will it help realize the short-term and long-term goals of your business? How will it help to grow your business? Answers to these and similar questions will help you create a list of key performance indicators (KPIs) for evaluating the effectiveness of a digital product and its requirements.

 

2. Identify the features of user search behavior

Study your users and find out their problems and needs. Build a customer journey map. How and where do your users look for a solution to their problem?

 

3. Identify obstacles on a customer journey

Find the difficulties your potential customers face in searching for a solution to their problem. Analyze all potential scenarios.  Uncover all possible pain points and determine the weight of each of them. It is important to understand the degree of influence of each obstacle of the client's behaviour. What can force them to abandon your or a similar service, and what will cause only slight discontent?

 

4. Identify opportunities to remove barriers and meet user needs

Your product should, in every way, help the client in their search for a solution to the problem, and not interfere with it. Therefore, determine how your product can help eliminate the identified obstacles and turn pain points into “wow” points. Identify the most important user needs within the investigated problem, and design the way they are ultimately satisfied with your service according to your business model─in a fast and incredibly simple way.

 

5. Develop a strategy and architecture for a digital product that balances business requirements, user needs and technological capabilities

Do not forget to coordinate the strategy of a customer-oriented digital service with the interests and goals of the business. Define the goals and objectives of the business, as well as the needs and behavior of its users for each phase of the user's journey. Next, based on this, develop the best configuration of functions and the information architecture of the product.

 

Basically, this is the secret of the success of popular fintech services. They choose a thoughtful and clearly focused business model based on solving actual user problems. Then they make the service simple and clear, making it easier for consumers to find and select a solution. It is very important that, instead of trying to offer everything and immediately, you focus instead on the key needs of your users, bringing their satisfaction to an ideal level.

I hope that my little discoveries obtained during this trip will allow you to extract a couple of insights or at least a different way of viewing the usual things. I hope that you will agree that the main goal of a good financial service is to improve people's lives in exchange for business growth and the potential for development.

 

 

Banking interface by financial UX design agency - UXDA TagsRetail bankingInnovation

Comments: (2)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 13 June, 2017, 16:18

Great post. The importance of psychology in Conversion Rate Optimization is something that totally resonates with our experience.

In one instance involving digital sales of bank accounts, we saw huge abandonment when prospective customers had to select the type of bank account they wanted to open online. The menu showed three types of accounts with increasing list of features. Having seen such tables on websites of SAAS and other digital sales websites, the customer was psychologically conditioned to expect progressively higher costs for the three accounts. When they didn't see any mention of fees on the product table, customers were again psychologically conditioned to perceive this as "yet another example" of the use of hidden costs by banks. Not surprisingly, many of them bailed out of the account opening journey at this stage.

We advised the bank to post the fees for the three accounts clearly. They turned around and asked us, "What fees? All these accounts are free". This came as a shock! 

Apparently, the bank made progressively more money from the float on the progressively higher Average Quarterly Balances stipulated for the three accounts and therefore didn't need to charge any explicit fees. Displaying "Free!" on top of all the three accounts led to a significant increase in conversion rate of website visitors to account openers.

For those counting, just this one step on the customer journey had two psychological drivers of conversion. Since I'm not a trained psychologist, I can't be sure but I think they're both examples of "confirmation bias".

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Alex Kreger
Alex Kreger - UX Design Agency - Riga | 14 June, 2017, 07:37 Thank you Ketharaman for your input! Really interesting and useful case.
Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Comment on this story (membership required)

Latest posts from Alex

Can FinTech Outcompete Banks by Betting on User Experience?

15 December 2016  |  24716 views  |  0 comments | recomends Recommends 0 TagsMobile & onlineStart upsGroupInnovation in Financial Services

Alex's profile

job title CEO
location Riga
member since 2016
Summary profile See full profile »
Banking & Fintech User Experience Strategist and Expert. Founder and CEO of UXDA, a leading UI/UX design agency for finance that helping online banks and Fintech startups engage their customers throug...

Alex's expertise

Member since 2016
8 posts9 comments

Who's commenting on Alex's posts

Ketharaman Swaminathan