2020 Financial Services Trends: How’d we do?
In 2019, Comperemedia launched four new trends for the financial services industry that we felt were indicative of the year to come. 2020 has had some of the most unexpected twists and turns, some of which accelerated our trend predictions even faster than we imagined, while others shifted the trends into new directions. Below are the four Financial Services Trends we identified for 2020:
Trend 1: The Invisible Payments Journey
As more and more friction is stripped away from the average transaction, the future of money movement will take place behind the scenes, nearing invisible.
Trend 2: Customer Service 2.0
Customer service will take center stage in 2020 but with a new twist, offering solutions to problems consumers and small businesses didn’t even know they had.
Trend 3: Preparing for the Unknown
With a strong emphasis on financial health, the industry is working harder to help consumers across all income levels prepare for an uncertain future.
Trend 4: Extensions & Connections
In 2020 and beyond, cross-industry partnerships, acquisitions, and product extensions will enable financial brands to offer some very unbank-like improvements.
Before we announce our predictions for 2021, let’s take a look back at two of this year’s trends and how they stood up to a global pandemic, an economic recession, and many, many changes to everyday consumer behaviors.
Trend 1: The Invisible Payments Journey
How’d we do? Nailed it!
From the start, COVID-19 has been an accelerant in the adoption of digital, mobile, and contactless financial services, and this is not just among Millennials and Gen Z. Every generation has seen increased adoption of digital and contactless payments as consumers adapt to new ways of shopping and paying for everyday items. Bank of America, for example, reported that 23% of new logins to its online and mobile products in April were by seniors and Baby Boomers.
At the same time, many consumers have spent the year adjusting to altered financial situations, opening the floodgates to the point-of-sale (POS) financing market and the demand for early access to earned wages – two products that saw significant growth this year.
The rise of contactless credit cards was also a key driver of The Invisible Payments Journey Trend as it’s another step towards truly invisible payments. Marketing around contactless cards took a unique twist this year, with issuers focusing on the germ-avoiding benefits. Sofi encouraged customers to “tap to pay” with their Sofi Money World Debit Mastercard when they want to “pay in person, but skip the germs,” and American Express positioned the use of mobile wallet and contactless cards as a way to “help you avoid touching surfaces.”
The Invisible Payments Journey trend will continue to evolve this year and well into the future with a focus on contactless cards, automated savings, and the integration of QR codes at the point of sale.
Trend 2: Customer Service 2.0
How’d we do? COVID-19 shifted this trend in a different direction
COVID-19 has created a new set of challenges and the pandemic has turned our daily habits upside-down. In this next era of hyper-vigilance, brands are still adjusting to a new set of rules and consumer expectations.
At the start of 2020, there was a growing sense of urgency within the industry around innovations in conversational AI, the use of machine learning to make proactive recommendations, and concierge-like services, all of which would elevate the customer experience to new heights. However, the pandemic immediately shifted the industry’s focus toward solving consumers’ most important, and more immediate problems, reverting back to the days of reactive customer service.
Some of the most notable shifts in customer service this year included the reduction or total elimination of fees to help bridge the gap for anyone who experienced a job loss, deferred payment opportunities, and the need to re-think the in-person branch experience in a way that took new safety protocols into consideration.
Direct mail was another area that saw significant changes this year, with a temporary shift away from acquisition (almost entirely) and instead focused primarily on customer communications. From May 2019 to May 2020, financial services direct mail was down nearly 70%. Most financial brands were cautious about communicating through direct mail because of the inherent time lag of the channel and the speed at which everything was changing with the virus. However, the majority of brands that continued to send mail were able to maintain some level of brand awareness while also offering support to those customers in need.
What’s Next?
As we look ahead to next year, we’re already brainstorming and discussing key trends that will drive the industry out of the pandemic’s wake. Stay tuned for the release of the 2021 Financial Services Trends, coming soon!
