Banks claim to understand the customer’s the best interest. The argument goes follow the money to know the priorities. People may claim differently but they usually buy what they feel hold the right value and more often than not, not being a cashless economy the money trail is there with the banks. They know what we like, what we spend on, what is important to us even they can also predict where the next spend would be.
This insight make Banks the partner no one wants to mess around with, and Banks know this. So, instead of playing solo and trying to keep the cash flow central to bank only, the latest way banks have found to reach out to the users or account holders is by introducing their Lifestyle apps. In Singapore, all major banks here in Singapore have their respective lifestyle apps.
What is there on a typical lifestyle app?
Your online spend is closely monitored by Banks and credit card companies. They profile people in categories or segments and then try to predict or assess the likelihood of them buying their next products in near future. In a nutshell lifestyle apps is the community of a Bank’s channel partners who want to capitalize on Bank’s transactional data to identify a sales opportunity and place the matching product to your needs right at your phone screen.
What’s wrong with it? Nothing. In fact it is a great convenience that you find the matching products without much effort. What’s even more amazing is that your bank became your private butler and you never realized it. This is amazing, very much like GroupOn on Steroids.
What did the bank achieved in doing this?
Banks have more benefits that you think in this ecosystem. They are the ultimate enablers of these ecosystems. Customers get what they want with minimal online (re)search and product companies reduced their Customer acquisition costs. Yes, there is a fee to be a part of the ecosystem, but customers pay that fee by the means of transaction data and that data helps Banks to create insights about you. Vendors or Product companies have to pay to be a part of this ecosystem.
Unique proposition for Singapore
Singapore has been an established online sales friendly state. Life is fast paced and people have less and less time to do actual shopping, though Singaporeans still known to be having two favourite pas times, Eating and Shopping. While you can’t find an online alternative for first but definitely the latter can be a lucrative space for online retailers to play.
Companies like Zalora, Shopee, RedMart, Amazon Prime and many more online retailers are in the mix, but the transformation is not only for new tech savvy start-ups, the old mom and pop stores are getting in to the game by listing their product offerings on Carousell & Gumtree. Some even have Whatspp presence that will take your order and deliver groceries to your doorstep with no delivery charge (if order is of certain minimum value).
Does this challenge the Bank’s ecosystem of lifestyle apps? Maybe or maybe not. It is too early to tell, but, it creates a perfect test bed for many start-ups to play the game and fine tune their strategies for bigger markets. Whatever little I’ve studied the market, Banks love new start-ups to explore more selling opportunities. Once the strategy is established, Banks offer these start-ups to be a part of the ecosystem and leverage on them. What banks earn in return? Lower cost on R&D for identifying new retail models. A perfect win-win for all.
Rest assured, you may see more and more Lifestyle apps coming your way with more deals and coupons. Get ready and gear up for some shopping bash!!!
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