“When you fulfill your promises, that builds trust, which builds affinity. People are more likely to stick with you and as you do that and continue to provide that, you create a more emotional connection.” -Eric Berg
Many financial brands struggle to make emotional connections with their customers. How about yours? Maybe it’s time to take a fresh look at whether you’re bonding with your audience on an emotional level.
Eric Berg, founder and CEO of NetGiver, which is a mobile app that allows people to give to nonprofits directly from their financial brand's account without incurring fees for the charity, knows exactly how financial brands can strengthen emotional bonds.
The COVID-19 pandemic has caused an enormous cascade of emotions for people around the world. When the pandemic first hit, there was mass confusion with people wondering “What’s going on? How do we process it? How do we deal with all of this?”
Then the vaccine was on the horizon and people looked forward to getting out, going to community events, and getting back to their normal lives.
There was a “kids in the candy store” kind of feeling.
These feelings have continued to progress into a variety of new emotions as the pandemic stretches on.
Buying With Emotion and Banking With Purpose
So how does Eric's company, NetGiver, operate in a world where emotions aren’t always part of the discussion?
NetGiver’s motto is to “bank with purpose,” which is a bold statement in the financial services space.
“I really think that as we look at banking, as we look at providing financial products and services to those that we're serving in the industry, the thing that we really have to keep in mind ... is this idea that people are emotional beings. And as emotional beings, every decision we make is an emotional decision as human beings. We justify them with logic, so we spend a lot of time justifying things," Eric shares.
For example, someone might want to go buy an expensive new car, then come home and put a spreadsheet together with pros and cons. They run the numbers. They figure out the lower-priced, more sensible car they can afford, but still, their mind keeps straying back to that more expensive car.
That’s the emotional side of buying. It’s why car manufacturers come out with new colors, shapes, and designs constantly. They want to entice you and drive the emotional experience and connection of owning a new car.
“And so as financial brands,” Eric says, “when we take a look at the fact that we are serving customers who are human beings, we need to be considerate of the fact that, okay, what are their emotional needs? What are their emotional decisions that they're making every day and how can we best support them?”
Eric explains that the #1 thing a financial brand can do to connect with someone is “meet them where they live,” meaning approaching them from their perspective, not based on assumptions or desires about how your brand wishes they would act, think, or buy.
We buy with the heart and then we justify with the mind.
Some buys are small, like a cup of coffee, and some are huge, like buying a car or a home. But there’s a reason Starbucks was able to tap into a commodity - a ten-cent cup of coffee - and turn it into a multi-million dollar brand.
Starbucks understands the emotional connection. A busy person can order a fancy, customized coffee on their phone, pop by Starbucks for a cheerful greeting, grab their cup of a delicious specialty brew, and head out for the day. It’s a ritual that lifts their spirits.
Drawing Emotional Attention to a Financial Brand
Eric explains that some financial brands fail to involve their customers in their brand.
If they try to incorporate a charitable component into their brand, they do it by holding up a giant check that shows a donation to a charity.
“Well, first of all, who writes checks anymore?” Eric asks. Someone from a younger generation has probably never written or received a paper check in their entire lives, so seeing a huge check draws no emotional connection from them.
Plus, the act of a financial brand donating money to a charity fails to involve the customers in the heartwarming act of giving. Instead, a company like NetGiver brings them into the process and gives them something to care about.
NetGiver is a company that says, in Eric’s words, "Well, look, we'll give $5,000 if you give $5,000 to the things that you care about … Now we can engage with you in something you care about, as opposed to just putting a picture about something that we think you might care about."
It’s also about changing the perception of a “savings account” or “spending account” and viewing it as a “giving account.” NetGiver helps people split their paycheck up and direct a portion of it to charitable giving.
Brand Positioning and Inviting People into the Narrative
Aspiration, the non-chartered neobank, is an example of a financial brand that takes an emotional position by welcoming its customers into its narrative. One of its primary mottos is “Leave your bank, change the world.” They aim to make every transaction a positive action that benefits the planet.
NetGiver does something similar in that it doesn’t just view a customer as an “account holder” but as a partner in giving. NetGiver and its customers create value together by doing something good together. That’s an extremely valuable emotional connection.
So many financial brands are driven by numbers and data and sometimes forget about the emotional aspect of doing business.
On the most basic level, change is difficult. It seems overwhelming to make such a big change in a financial brand’s positioning.
However, small changes can make a big difference.
“Not every product or service you offer reaches every member or customer of your financial institution,” Eric says. “We try to make a big, broad scope look at something, but even online banking is really only what, 60, 70% of financial institutions have their customers or members using their online banking products. So even that is something that is growing over time.”
Financial brands shouldn’t give up on making emotional connections just because it’s a slow process. “It's going to take some time, but you’ve got to start now, right? Because the longer you put it off, the further behind you are in what's actually transforming the industry right now.”
Millenials, Gen Z, and Younger Generations
Studies show that more than 75% of Millennials and Gen Z's are aligning their values with the products and services they choose. To them, it’s important to look beyond price and other qualities to make an emotional decision about buying.
This market might stay with a product they’ve loved their entire life, or they might consider a new brand that’s making strong emotional overtures to them. It’s a chance for a financial brand to seize the opportunity to make a connection.
Eric emphasizes that a financial brand shouldn’t think of this as a “meet in the lobby” interaction because many young people don’t set foot in banks. Instead, meet them online. Meet them on their smartphone. Meet them on social media. Meet them where they are, not where you want them to be.
But What About the Bottom Line?
CEOs can struggle to feel confident that emotional connections are going to lead to financial success. They tend to ask questions like, “How is this going to positively impact the bottom line?”
Eric acknowledges this issue and brings up his background working in sports branding. “Anybody who's been to a sporting event or been to the theater or been to something that as you're sitting in the audience or in the crowd and the game is continuing or the show is on, there's that opportunity where you come alive, right?”
He explains that when the audience sees the team win on a last-second shot, the elation that takes place at that moment is something that’s missing in the financial world. A sports team owner understands the value of that emotional moment, but the financial brand owner doesn’t always make the same connection.
Eric points out that the enormous growth in the sports market in the past 20 or 30 years exists because of emotional connections. Plus, people can take the emotional bond with them anywhere in the world through their phone, playing fantasy sports and game-ifying other things in their lives.
Why can’t financial brands do the same thing?
The answer is: They can.
They just don’t - or at least, most of them don’t yet. The financial brands of the future are the ones figuring it out now.
And before we leave the topic of sports, consider that financial institutions have tried to connect with their customers through sports for decades. That’s why banks sponsor sports teams and stadiums. They want to be part of the experience and acknowledge the impact, but they still have a hard time doing it themselves.
Eric advises financial brands to go beyond the “stadium sponsorship” style of marketing and consider smaller, more intimate connections. What about joining your community for a 5K walk? How can you reach people through a church or synagogue? Where are the spaces where your customers spend time? Be there to meet them.
A New Definition of Community for Expanding Brands
The concept of “community” is changing too. A community used to be a small geographic area where someone lives and works. It might be 12 to 18 square miles, which was usually considered to be the maximum reach of an old-fashioned community bank branch.
Today, the notion of community has expanded far beyond this limited scope. Neobanks don’t base their audience on geography. Not at all! They base it on emotion. The concept of community arises when people have something in common.
The new definition of a community could be based on something you crave. It could be based on something psychographic, like a daily food habit. It’s simply something that strikes a chord with people and makes them feel like part of a community.
Think about Chewy.com, the site for people who love their pets. Chewy built a community of pet lovers that goes way beyond just buying pet products. It’s a place where people who adore their pets can go to browse ideas, evaluate services, and order items that show their pets how much they truly cherish them.
Another example is the outdoor brand REI. This brand not only has cultivated an online community of supporters but also has a physical community of people who get out in the world and do outdoor activities together due to a shared affinity.
Culture and Changing From the Inside Out
To build an emotional experience with customers, financial brands must start by building the emotional experience for their employees.
This is a transformational journey that starts internally.
Otherwise, it will be half-hearted.
Eric shares the story of a credit union that gave its employees “jeans Friday,” where they could wear jeans to work each Friday and give to a certain foundation through NetGiver. The credit union saw moderate success the first week. But the next week, they allowed their employees to give to any organization they wanted, plus they could also wear jeans on Friday. Results spiked up!
This shows that the employees wanted to engage with something they cared about. It wasn’t just about giving to a specific foundation or wearing jeans. It was about giving to something meaningful to them - something they chose, not something the company happened to offer.
This shows the importance of turning your attention back on your audience and saying, “This is about you.” Now it’s easier for them to welcome a transformation because they feel empowered to choose something good.
Going back to the example of REI for a moment, consider that they have a huge philanthropic aspect to their business. They say on their website, "We believe a life outdoors is a life well-lived. That our connection to nature is essential to our humanity. That has guided our reinvestment back into the community for over 80 years. And today, more than ever, we dedicate our philanthropy to assuring that every person can benefit from time outside."
REI invested more than $8 million in more than 400 nonprofits. They’re showing their employees and customers that when you join the REI community, you’re doing something big for others.
Banks and financial brands can do the same by showing that doing business with them is doing good in the world. If someone loves the outdoors, for example, help them connect to the outdoors.
“Financial institutions have a wonderful opportunity right now,” Eric says. “Their money exists in the accounts of their customers and their members, and a portion of that money is going to be used to be given away to things like the outdoors, right? So it's where it starts … If somebody wants to donate to the great outdoors, where that starts is within your financial institution. You're at the beginning of that journey.”
Remember: Trust is Everything
If you’re going to make an emotional connection with people, you have to ensure that the trust is built into the process at every step. Break someone’s trust, and you could lose them forever.
Eric explains, “When you make a promise that you're going to do X, Y, or Z for your customer, for your member, and you fulfill that promise, you increase and garner brand equity and trust, and you create a tighter bond between you and your member and your customer.”
This level of trust is just as important as the trust you have with your spouse or your kids, Eric says. “When you make a promise, you want to fulfill that promise. When you fulfill that promise, it builds trust. When you build trust, you build affinity. When you build affinity, people are more likely to stick with you and as you do that and continue to provide that, you create a more emotional connection.”
This article was originally published on October 27, 2021. All content © 2021 by Digital Growth Institute and may not be reproduced by any means without permission.