Fintechs are missing a trick ignoring older generations. They’re the ones with the money.
Now is the time to think about whether there is a story to tell for older customers, and the way this can be told.
I recently attended an event at Fintech Week discussing how fintech can benefit the over 55s. Despite a fantastic line-up of speakers from around the globe, the room was virtually empty. The organisers blamed train problems, but I suspect it was more likely appetite, or lack thereof, for the subject.
Millennial money is the latest phenomenon in tech. As a millennial myself, whether it’s my (supposed) inability or desire to save, an aversion towards an inaccessible investment industry or apathy towards retirement planning, swathes of silicon start-ups are piling in to save my generation, and those coming up behind us, from inevitable money misery.
And while my chosen apps are undoubtedly helping me take control of my finances (the morning flat white round-up function is proving particularly effective), I remain perplexed as to why the vast majority of these innovators are narrowing their target consumer base to those with, relatively speaking, no money.
This comes down to our inherent bias (and borderline patronising?) bias that older generations have a lack of interest and understanding in technology. As a by-product of this, many fintechs are assessing their limited marketing spend and choosing to park this area of the market, believing the level of effort involved to convert customers, let alone command their loyalty, is just too much of an undertaking in the pursuit of fast growth.
Fintechs have won the respect of the young by focusing on their ability to offer speed, simplicity and value. These are the very same attributes older generations look for in their providers. Surely there is merit in exploring this market.
Cementing belief in long-term product viability is a constant source of scrutiny of the fintech industry, particularly in the eyes of investors and regulators. Securing the buy-in of older generations can be a very useful tool to demonstrate this. Not only does brand loyalty tend to be stickier, with a $15trn global spending power, the pots of cash to spend once the user is acquired tend to be far larger. For those fintechs where profitability is dictated by deposit size or fee arrangements – namely banking, investment and insurance products – this is worthy of attention.
While slow to adapt in other areas, incumbent providers with ready-made bases of older customers, have first mover advantage. But, at the same time, cynicism of our financial system and outrage at the injustice of the consumer loyalty trap has never been greater. The landscape is ripe for pioneering fintechs to take advantage of this shifting sentiment.
Now is the time to think about whether there is a story to tell for older customers, and the way this can be told. This doesn’t necessarily mean losing hard won brand identity, but it is worth considering how this can be tailored. Yes, these customers are likely to be more considered in their decision-making process, but if you can afford an element of patience in user acquisition, successful conversion of this customer base will go a long way to building a sustainable business capable of the scale of disruption most are dreaming of.
 Fintech4life: Global spending power of those aged 60-plus will reach $15 trillion annually by 2020