My Writings. My Thoughts.
I’m in the process of assembling my startup team to help me build Tribed. I’m looking for a small number of great people to join my crusade and bring engaging financial services experiences to niche communities (like Wag). The most important thing is that my team members:
- Share my passion for Tribed’s vision
- Are inspired by the chance to to make their mark on our industry-altering business concept
- Have startup experience
The two main areas of expertise/roles I am looking for team members for are: Operations and Technology, and Partnership Development. I’ve put a brief description of each on Tribed’s site athttp://www.niche-banking.com/collaborate/.
And please note: you don’t have to have banking industry experience to be part of our team.
If either of these profiles are a fit for you, drop me a line at email@example.com.
On Monday, the CU Water Cooler Liquid Lunch show featured a conversation between host Carla Day and special guest Jimmy Marks. On the agenda was a discussion about initial thoughts on Wag, The Bank for Dog Fanatics. I was busy during the live show and was not able to dial into the call, but I listened to the replay of the show and wanted to provide a few comments and responses.
Overall, I must say the discussion was very good (from my perspective), and—to be totally honest—did not ridicule Wag nearly as much as I expected. Rather, I felt Carla and Jimmy truly did grasp a good portion of the idea behind Wag and Tribed.
Note: If you listen to the replay, the portion discussing Wag is between 9:00 To 17:45.
1) Jimmy: “You have to be a dog lover to identify with this group”
That is exactly right…and is in many ways the point. When you truly create a distinct brand experience, it should completely turn off and sound ridiculous to those who it is not designed for. In other words, it should polarize.
2) Carla: “You can get your debit card with the dog on it….and learn how to save money.”
These are both true. But the point I want to emphasize is that these two things just barely scratch the surface of the vision for Wag. A debit card dog photo is by itself just cosmetic and doesn’t really make the experience to dog fanatics more relevant than at another financial institution. Rather, what truly defines the experience is:
- Connecting with other members—and all employees—who are dog fanatics
- Members adding to the community dialog on an ongoing basis about financial issues related to the dog-oriented lifestyle
- Products that are tailored to the dog fanatic’s lifestyle, when possible
- The Bottom Line: an experience that is 1000% relevant to a dog fanatic’s lifestyle…and 0% relevant to a non-dog lover
This brings us to…
3) Jimmy: “It’s not that this is just a bank for dog lovers, but is a community of dog lovers that even has its own bank.”
Bam. Exactly. Couldn’t have said it better myself, and therein lies the core of this business.
4) Carla: A new definition of common bond….
Carla nicely alluded to another key point of Wag and Tribed as a whole: we are redefining what a “common bond” is. Even though we are creating a bank, not a credit union, the principle is same. So much, in fact, that (no offense to credit unions), I expect that Wag customers will feel the “membership” vibe WAY more at Tribed’s banks than at a credit union. And we’ve developed several ways to make sure of it.
5) Jimmy: “Geographical lines are not the only lines we draw, and they’re not the only lines we start to erase.”
Right again. Damn, you guys are really getting this—I’m impressed. (seriously)
Last reminder: as people evaluate Wag, I hope they will actually evaluate Tribed just as much. Keep in mind, Wag is just the first of a large portfolio of banking experiences we are creating. And when evaluating our business model, remember there will be 20-50 Wag counterparts.
Thanks to Carla and Jimmy for their interest in Wag, and for doing a great job discussing several of the salient points.
// October 17th, 2011 // 1 Comment » // Banking, Banking business models, Banking business strategy, Decommoditization, Engagement banking, Enthrallment banking, Entrepreneurial Lessons, Jeff Stephens, Tribed, Wag: The Bank for Dog Fanatics
Friends: I am very excited to share a new entrepreneurial venture with you that I’ve been working on for quite a while, albeit anonymously: Tribed, and Wag: The Bank for Dog Fanatics. Please take a moment to watch this video to learn more.
The credit unions I’ve worked with have all been very sincerely committed to the credit union principles that their industry is based on. The foundation of these, of course, is the idea of “people helping people.” The industry believes, in theory, that as long as they are delivering on this “people helping people” mission (and obviously as long as they are able to run a sustainably functioning business), that’s all that matters.
So, why aren’t more credit unions creating a custom Key Performance Indicator (KPI) calculation to measure their delivery of this “people helping people” philosophy? Or, why hasn’t the industry created one common KPI calculation for all credit unions to use and measure their effectiveness with? It seems to me that this KPI would be the most important number on any credit union’s management dashboard.
What factors would the formula be calculated upon? I would see it taking into consideration several criteria that would together represent a picture of what the credit union’s “total impact from people helping people” is. Here are a few inputs that would make sense for the formula:
- Number of first homes purchased by members with CU funding
- Revenue growth of businesses as a result of CU funding
- Jobs created by business member clients
- Jobs created by the credit union itself as an employer, or through the credit union’s growth (construction workers on a new branch, etc.)
- Cumulative interest expenses saved by members who refinanced with the CU
- Number of new members who were previously unbanked
- Cumulative credit score enhancement of members
This is just a starter list of the many things that could be included in this calculation to give a comprehensive view of the total impact of a credit union’s commitment to “people helping people.” Not only would this be key for management, it could also spur some great PR and word of mouth.
As I was sitting in the presentation by Terry Jones, founder of Travelocity.com yesterday at the EO Texas University, I was reflecting on the overall trend Terry pointed out about how we’ve seen such an emergency of do-it-yourself (DIY) culture in the past several years–thanks to the Internet. Travel agents are obviously just about obsolete now because of this DIY movement.
It’s similar in banking.Thanks to the Internet, consumers can shop for the best rates, products and services online, and then after making a selection, take action. They can do it all by themselves, without any real help from the individual banks they are considering.
So I got to thinking, “what if….”
(Note: as with all my “what if” ideas, I’m not saying the following is necessarily a good idea–I’m just saying it’s an idea that should at least be pondered for a few minutes if you advocate innovation in financial services)
What if there were a layer of “banking agents”? Would they be able to add any value to the consumer or the bank, and thus earn revenue? Is there money to be made stepping into the middle of what is otherwise a DIY situation? Here are a few quick ideas I had:
- Buyer’s Agent: There is a (small) market for car buying agents–people who have established relationships with car dealers, and can help consumers get the best prices, sourced from a large network of dealers, without price haggling. What if a banking agent could develop special relationships with banks and credit unions, and be able to offer special exclusive deals to consumers who worked with that agent? The consumer would be willing to pay a reasonable fee for that. This model would work if….
- …The agent could guarantee the delivery of a certain volume of business to the banks and credit unions. It would like being an independent sales rep for the bank and credit union, and the financial institution would be willing to pay a commission for those sales.
- Commercial Loan Participations. A banking agent could be a great resource for coordinating the funding of large loans that individual financial institutions couldn’t or wouldn’t want to fund. It’s likely both the borrower and the lender would pay for this matchmaking and coordination.
- Continuous Evaluation: A banking agent could continuously evaluate his/her client’s banking relationships (for both deposits and loans), and proactively create better deals and arrangements with other banks, and then let the customer know when it was ready. The customer would find value in this and would pay accordingly.
What are your ideas? Let’s add to this list. Or, on the flip side, feel free to disagree!
I am currently reading Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers by Alex Osterwalder and Yves Pigneur. I’m just at the beginning, but it’s a great book so far.
I’ve often pondered the need for a business model revolution in the banking industry. Until now, I always thought the problem was that bankers wouldn’t know how to evolve (or completely change their business model). But now, the book has me realizing this question is only half of the real issue.
The other half of the question is: ”If a bank knew how to evolve or change its business model…would it?” In other words, would it have the guts? Would it have the resolve to stick out a painful transition? Would it be willing to go against the grain and be a champion of change?
This is an entirely different question. Deep thoughts.
First, let me be clear: I’m a big fan of the concept of “Engagement Banking.” I really like the Engagement Banking site from Sapient Nitro, and love what the guys at Geezeo are doing. The only thing I don’t like about the Twitter hashtag #engagementbanking is that I didn’t think of it. And if you’ve paid even a shred of attention to what CBC is all about, it’s got brand engagement written all over it.
But lately, I’ve got to wondering something: Is “engagement banking” enough? To have an engaged customer/member base is certainly an improvement from where most banks and credit unions are today…but does engagement banking go as far as we really need to take it in this industry? Will engagement alone help us break free from being commodity financial providers?
Or do we need a heavier dose than just mere engagement?
I’d like to suggest that what banks and credit union brands really need is “enthrallment banking.” As in, “I’m captivated with this brand because it resonates so strongly with me.” For instance, Apple loyalists aren’t engaged with Apple, they’re captivated by it.
You may be thinking, “one step at a time, Jeff–we have to walk before we can run.” And maybe that’s true. But it doesn’t hurt to ask ourselves today, “what is our real end goal: engagement or enthrallment?”
I write this post from the CU Watercooler Symposium. As I sit here listening to the speakers, I am reminded of a recent tweet from Geezeo’s Bryan Clagett, in which he said: ”If you do not know the difference between a “member” and a “customer”, then you should not be selling to credit unions.”
I agree with Bryan. But his comment also got me wondering: how many MEMBERS really understand the difference between being a member and a customer?
As you know, I’m all about helping bank and credit union folks think like entrepreneurs. And I believe great entrepreneurs are experts at exploiting marketing opportunity. There is a a huge, exploitable marketing opportunity in the following:
Making the difference between a customer and a member strikingly, painfully, ridiculously, unmistakably clear.
Note: As you may have heard me argue before, the question is not “how is a being a member BETTER than being a customer?” It’s simply “how is it different?”
Today, I don’t believe this difference is clear at all, nor is the experience of being a member noticeably different from the experience of being a customer. So here are three quick ideas of ways credit unions could make members really feel like members, not customers:
1) Difference: Members own a part of the CU; customers do not.
Making it Clearer: Make them act like an owner and be accountable to that responsibility. Don’t give members the option to vote; require them to vote.
2) Difference: Members are co-owners with other members
Making it Clearer: Connect members with each other. Introduce 5 members to 5 other members tomorrow. Facilitate them getting to know each other. Bond them together.
3) Difference: A member must qualify to join
Making it Clearer: Emphasize exclusivity: put more focus on who can NOT join. Make it clear who is not lucky enough to even qualify, and you will make the value of membership seem higher.
Now it’s your turn: what other differences can we make clearer?
I would apologize for the cynical nature of this post, but I know you readers are used to it by now. Plus, this is just downright funny. From the people at Despair.com (I know you’ve seen some of their work before) comes “Tradition.” Why not order a 24×30″ poster for your break room? Place your orders here.
Perhaps the funniest part is how I came across this particular item: I was talking to an entrepreneurial friend about banking, and without my prompting, he pulled this up on his phone. I think that says something about the financial industry!
As you may already know about me, there are a couple things I believe strongly:
- Bankers need to think more like entrepreneurs and less like bankers
- I love to help bankers identify business lessons learned from other non-banking industries, and apply them to banking
To help achieve these two things, I’ve long been planning to create a book club and/or reading group for entrepreneurial bankers. That’s why I’m excited to announce that the American Bankers Association’s ABA Banking Journal online has published a review I wrote of the business book, Rework, by Jason Fried and David Hansson of 37Signals.
To whet your appetite for the review…
Rework is probably not a book that will be read proactively by many bankers…although I’m hoping to change that. Most bankers will say “this book is written for startups and new economy companies–this will never work in the banking world.” And they, of course, would be wrong. There is a lot of great content in Rework that bankers can apply to their businesses. With its concisely written chapters and simple-yet-profound and seemingly contrarian messages, the book reads very quickly in about three hours.
In the review, I explore three main concepts that emerge from the book:
- Prioritize your work
- Say no
- Be real, and be yourself