Banking on Digital Growth
Banking on Digital Growth

Episode · 8 months ago

138) #InsideDigitalGrowth: It’s Time to Go ALL-In on Human-Centered Growth


Do different markets require a different approach to digital growth? Yes and no.

Regulations, economies and cultures may be different.

But human-centered growth is universal.

In this solo episode, I’ll be answering a question about Fintech deployment in Latin America — but the answer transcends borders.

I cover:

- How to focus on the uniqueness of emerging markets like those in Latin America

- Human-centered growth

- Why you need to go ALL-in on your digital growth

You can find this interview and many more by subscribing to Banking on Digital Growth on Apple Podcasts, on Spotify, or here.

Listening on a desktop & can’t see the links? Just search for Banking on Digital Growth in your favorite podcast player.

No, I'll ask, thinking about latin America, what happens with Fintech deployment going forward? What will hold growth back? Is it cultural isn't? Regulation is a political and who is in the best position to innovate and capture growth going forward into the future? Well this is a great question Noel and one that transcends cultures and boundaries and it is a question that many financial brand marketing and sells leaders should be thinking about regardless of where they are in the world, which is why I'm looking forward to answering it for you on today's episode of Banking on digital growth. Okay, you're listening to banking on digital growth with James robert lay a podcast that empowers financial brand marketing, sales and leadership teams to maximize their digital growth potential by generating 10 times more loans and deposits. Today's episode is part of the inside digital growth series where James robert shares answers to some of the biggest digital marketing and sales questions he gets from the digital growth community. Have a question you want to get answers to on a future episode visit www dot go ask jr dot com to submit your question today. Now let's go inside digital growth greetings and hello I am James robert, ley and welcome to the 138th episode of the banking on digital growth podcast where I James robert lay your digital anthropologists, commit to continue to coach and guide you along your digital growth journey as you commit to continue to coach and guide people beyond financial stress towards a bigger, better and brighter future. Today's episode is part of the inside digital growth series and I look forward to answering a question from Noel, who is the corporate treasurer for a financial brand in latin America. And before I answer Noelle's question, I'd like to invite you to join me on a future podcast episode to gain clarity to talk through your biggest digital marketing cells or leadership questions that you'd like to get answers to. So please do text your questions 28325495792. And my team will get with you to schedule a time for you to join me on the show. Let's get back to Noelle's question here and I want to first provide some context around his thinking as he shared with me that some emerging markets such as china south africa India, all big quote unquote, big ticket countries are leading the Fintech and non traditional banking space pioneering really, despite their low financial literacy and banking penetration in those markets, He continues thinking about Latin America with more than one trillion in GDP and close to 100 billion and Remittance from the north to the south. What happens with Fintech deployment going forward? He asked, what will hold growth back? Is it cultural isn't...

...regulation is a political and who is in the best position to innovate to capture growth going forward into the future. Once again, this is a great question Noel for anyone who is listening from around the world as the thinking I'm going to share today transcends all borders and boundaries that transcends all cultures as the answer that I think through and talk through provides a clear path forward, not rooted in technology but really rooted in people. And to begin with your question that you ask around culture is very valid. And I'd like to take this a step further to note the importance of digital culture within a specific region, particularly through the lens of digital anthropology, which is right at the center of where we focus. That's the study of the intersection of marketing, sells technology and human behavior and you referenced china and India as big ticket countries leading the fintech and non traditional banking space too. Despite their low financial literacy and banking penetration for a moment, I want to put banking behaviors aside and just look at the overall digital adoption behaviors that would first and foremost be a natural requirement for any type of fintech growth. In 2020 in Brazil, the most populated country in Latin, America Brazil had around 141 million smartphone users and that's about a 66% penetration rate into the total population of about 212 million people. And furthermore, let's look at Mexico, the second most populated country in the region which was estimated to have about 80 million smartphone users in 2020. And that's a 62% smartphone smartphone penetration in a country with a total population of 129 million On the flip side in 2020, the number of smartphone users in china reached 970 million people. It's almost one billion people which is still around 63% of their population and follow similar trends to what we're seeing in brazil, what we're seeing in Mexico And in India smartphone adoption was estimated to have reached over 748 million people in 2020. Now Drivers a little bit which is about 54% of their total population. Stateside here we are seeing smartphone reach for 2020 was about 294 million people or about 87% of the total population. Which which really is leading the world from a from a population penetration standpoint. And the point of this exercise when when going in and looking at the number, looking at the data, looking at the research, the point is to consider what is the potential reach of any audience that has access to a smartphone capability which is going to be required to boost fintech adoption. And...

...while China Brazil Mexico they all have similar market penetration rates coming around that 60 65% penetration rate. China's total number of smartphone users is over 10 times greater than that of Mexico's which is over. Which is also over seven times greater than that of brazil. So just getting access to eyeballs is going to be an important consideration for any fintech at a global level. So if I'm in latin America, if I'm in africa, if I'm in the U. S. Even for that matter, who was thinking about launching a fintech, I first and foremost want to see how big my potential audiences when making a case for the future and really a case for future growth. And the reason that I note this and I note the U. S. Is because even while Fintech continues to explode here stateside, I do see opportunities for both fintech and traditional financial brands to tap into niche market opportunities. But it's important that those niche market opportunities are large enough or big enough to create value over the long term, they're not too small to where we start to get into something and we realize that there's just not the ability to scale within that particular niche market. I've had numerous conversations with Geoffrey Kendall, who's the ceo of Nimbus on the podcast where we've talked about this idea that niche is the new local and I believe this idea of niche once again it transcends all cultures, it transcends all boundaries and this is why as fintech and traditional financial brands look for collaboration opportunities, it is more important now than ever before to know your market and recently I was doing a keynote session for an event in Dubai and I I think that the interesting thing about this particular event was I didn't have to get on a plane to give this key note, I was actually able to just zoom in teleport in if you will and provide some perspectives for the start of what was a really good learning experience over in Dubai and staying around and listening to a panel discussion that transpired after my opening remarks. It was interesting because one of the panelists was talking about this idea and and really the need to know and understand the market now more than ever before, particularly within the financial services space, because They've made a reference that, you know, this particular institution had launched about 300 products over the years without really doing any type of early market research into identifying why are we launching these products to...

...begin with in the first place? And so that's a uh this this idea of of knowing your market and really I would say going all in on your market, all being an acronym A. L. L. Will help to create a strategic competitive advantage no matter where you are in the world. And what I mean by going all in A. L. L. It means this number one asking good questions, getting really good at asking good questions. What are people's pain points? What are the questions, what are their concerns? What's keeping them up at night and how really how are these problems affecting their health, their overall health, their physical health, their mental health, their relational health, because money is at the root of all mental physical and relational problems and granted there are other concerns as well. But the more research that we're doing, it's it's rooting back to financial stress if you will, technology has transformed our world and digital has changed the way consumers shop for and buy financial services forever. Now, consumers make purchase decisions long before they walk into a branch if they walk into a branch at all, but your financial brand still wants to grow loans and deposits, we get it. Digital growth can feel confusing, frustrating and overwhelming for any financial brand marketing and sales leader, but it doesn't have to because James robert wrote the book that guides you every step of the way along your digital growth journey, visit www dot digital growth dot com to get a preview of his best selling book banking on digital growth Or order a copy right now for you and your team from Amazon inside you'll find a strategic marketing manifesto that was written to transform financial brands and it is packed full of practical and proven insights, you can start using today to confidently generate 10 times more loans and deposits now back to the show. Once we get really good at asking good questions, we can then begin to listen to people's problems and listen to the answers that they give. This is where we can tap into the emotional side of money and the more that we as financial brands and Fin techs can create prescriptions and cures to solve people's pains to cure their ills, to guide them towards a bigger, better, brighter future, the better off people will be well, you know I always say if you can transform a person's wallet you can transform and improve their physical well being, you can transform and improve their mental well being, you can transform and improve their relational well being. So number one we...

...ask good questions, Number two we listen to the problems and number three the third of the second l is we learn from observation because what people say and what people do or sometimes at opposite ends of the spectrum. I did an episode on this podcast, really talked about how to go beyond the traditional focus group and this is looking at just observation, studies the way that people interact with money, the way that people interact relational li the way that people interact with technology and so when we can look and observe, when we can listen to people's problems, When we can ask good questions, we can gain key insights and perspectives of how to help guide them forward on their own financial journeys And this is something that transcends all cultures and it is a key reason that we teach financial brands, what we call the 90 day growth method which is a system that empowers financial brands and fin techs to escape getting stuck doing digital because it's so easy to get stuck doing anything. But when you get stuck doing digital, it can be a very deadly place and and that's why it's important to create space and time to stop doing so that you can first review what you've done, learn from those experiences and then think deeply about the key insights that you gain And use that thinking to then really plan out your next 90 day period of growth. I want to come back here for a moment, back to your unique situation in latin America and do some some additional thinking for, you know well here and when we look at latin America and some of the opportunities that exist, it's important once again coming back to people putting people at the center of all of your thinking and all of your doing, it's important to consider how people shop and buy at a macro level. For example, in latin America, the economy historically has been relying heavily on cash on physical currency exchange and I want to go back to looking at the examples before around smartphone adoption in both Mexico and brazil. But this time let's look at it through the lens of payments As in Mexico more than 90% of payments or paper base and in Brazil it's around 70% of payments or paper base. However, according to the Mexico Daily News E Commerce transactions have really seen a dramatic surge over the last 12 months or so Mexico for example, saw a 32% increase year over year in 2020 with aecom transactions and a lot of that is rooted in the pandemic. But and this is a really big but buying products online is still relatively slow as only a subset of the population... latin America has the financial products to participate in these online digital economies. It's also interesting and it's really important to note for a global audience listening today that the default for most people in latin America from, from a behavior standpoint is they'll order online and then pay at a local convenience store in cash. So it's really this digital physical interaction here. Another point to make in latin America as really around the world for that matter, particularly we're thinking about the underbanked or the unbanked is rooted in trust or a lack of trust, particularly within the banking system. As this lack of trust historically in banking systems is another factor that Fin techs moving into the space will have to consider it. Not only do we have the technology side that we have to bridge on 11 side of the coin pun intended. We also have the trust factor that we're going to have to bridge as well. And even with some of these historical challenges, whether that be technology based currency based trust base. Even with some of these historical challenges in consumer behavior, there are three things that I see showing favorable signs to fintech players in Latin America as well as around the world, particularly speaking to the point of latin America is number one, government regulation Is appearing to be what I call fintech friendly. In 2018, the government Mexico passed a fintech law that helped to create a framework for finn text to offer new products and do business legally under the same terms and conditions as a lot of traditional financial brands have done historically. Number two is even though latin America has been primarily a cash based economy, Covid has really accelerated the transformation of consumer behavior is more and more people have tried out new financial products and apps as opposed to visiting physical stores, physical locations and back to this point of payments and commerce in general, e commerce in latin America has seen double digit growth throughout the pandemic. And I think when you start looking at this as a macro level, you start seeing these trends and patterns across borders across cultures and and back to Latin America point number three, Fintech investment continues to flow in at an exponential rate really. Over the last 12 to 18 months, we've even seen the rise of the Brazilian Fintech new bank leading the way is one of the largest neo banks in the world. And so in closing, no matter where you are in the world, no matter if you're at a traditional bank or credit union or if you're working on the Fintech side of things, the most important thing that you can do as you look ahead...

...towards future growth, to create an even bigger, better, brighter future for people is to put people at the center of your thinking, put people at the center of all of your doing and this is what we call here at the Digital Growth Institute, it's called Human centered Growth and I want to reference something that Derek Sutton from Auto Books recently shared with me in a in a linked in conversation that we were having. Derek shared Human contact matters when it matters most to the end, consumer human contact should not be used as a crutch to not embrace digital and a focus on digital should not be used as a crutch to not also embrace the importance of human contact. The key as Derek rights is to understand when consumers want or need each of the other and then design a solution that helps them to make progress on their own terms. I really appreciated this thinking that Derek shared with me, which I thought was relevant for today's topic and conversation because when we look at the relationship between money, between people, between technology and it really just focusing on the people and the technology, the human digital, we can bridge the human digital divide by studying the young and the young symbol which has origin in taoism dating back to the fourth century fourth century Bc at the heart of really encapsulating the taoism philosophy, finding the way discovering harmony and balance within the young. And the young symbol has two distinct parts. The yuan is the dark side of the symbol, The young On the other side is the light side of the symbol. However, contrary to being what we would consider polar opposites. The young and the young are not complete opposites and this is in fact, you know each side. If you google the symbol, you'll see the circle with the black and the white. Each side has a little bit of the other in it while curling up and holding the other side imbalance. Put another way. one side cannot exist without the other. The same is true when thinking about future growth and financial services. Around around the human and or digital experience. One cannot exist without the other. Each side human digital balances out the other, it complements the other and it really elevates the other side to be even that much better. So as you look ahead towards the future of digital growth, remember it is about people and technology is just a tool that connects people together to transact, to create value, to really help people ascend to...

...the next level as a whole. So if you're thinking about digital marketing, sells leadership, you have a question as you're looking ahead on your own digital growth journey and you have a question like Noel Text me your question that you'd like to get some clarity on 283-254-95792. And I look forward to you joining me on a future podcast episode as my guest to talk through your question together until then and as always be well, do good and make your bed. Thank you for listening to another episode of banking on digital growth with James robert. Ley like what you hear, tell a friend about the podcast and leave us a review on apple podcast, google podcasts or Spotify and subscribe while you're there to get even more practical improvement insights, visit www dot digital growth dot com to grab a preview of James, roberts, bestselling, book banking on digital growth or order a copy right now for you and your team from amazon inside you'll find a strategic marketing and sales blueprint framed around 12 key areas of focus that empower you to confidently generate 10 times more loans and deposits until next time, be well and do good.

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