New Financial Habits
Make it quick: decision fatigue and consumer psychology of Gen Z
In 2020, if you want to have a slice of pie named consumer’s wallet — you need to move your service to messengers, not create a standalone app
In 2020, if you want to have a slice of pie named consumer’s wallet — you need to move your service to messengers, not create a standalone app. Your chances of high user engagement, retention, and LTV are higher if they don’t have to leave the default apps and spend even more mental energy on unnecessary choices. Can your banking service really reduce the anxiety of day-to-day living in this age of information? In the attention economy, this is a crucial factor for long term success.
Life is now faster than ever. The speed an average modern human chooses to exist at accelerates daily, so does information density. According to research, in 2011, on a daily basis, people consumed 5 times as much information as they did in 1986. Since then, that amount must have doubled. The issue is, our brains are not fit for processing this amount of data. We work longer hours, spend more time on the commute, and less time with close ones, all to conform to some idealized image of a successful Randian self-made hero who does it all.
Another part of the problem is the waterfall of choices. You face them while grocery shopping, following fashion, swiping through Tinder profiles — everywhere. At times, it gets so overwhelming you close the app and decide to watch a Marie Kondo Netflix special on how to minimize your wardrobe and finally bring some long-deserved joy to your stressful life filled with obligations to meet and ideals to match.
That is a part of the reason why the whole OK BOOMER meme even exists: elders just don’t get it. How can you not enjoy life with so much to do? “Just go outside”, “talk to someone”, “have a drink”, and so on.
So, how do you want the young to make rational decisions, file taxes in time, be a supportive partner, let alone parent (or wish to have a child at all) if the reality is so anxiety-inducing? Humans have only evolved to process at the speed of 120 bits a second while being fed gigabytes of irrelevant data daily to filter through. The rise of mindfulness apps, once again promising to bring you peace (at least for 10 minutes).
And as all medics, psychiatrists, and psychotherapists know, chronic anxiety leads to fatigue. In this state, you make quick emotional decisions because your brain is depleted of energy necessary for proper “slow” rational thinking. It is called decision fatigue.
How decision fatigue affects digital behavior and choices?
Back in 2015, 85% of the time spent on smartphones was allocated to apps. From this 85 %, 84% (sic) was devoted to 5 most-used apps. Unsurprisingly, most often, all of them turned out to be either social networks or messengers. Meaning, to grab at least some user’s attention (and therefore, time and money), you have to be at least as addictive as the social apps. Which only a small fraction of apps coming not from the tech giants manage to do (and not in a good way).
If you are a fintech app, your prospects are even more daunting — users have to trust you with cash. And if they don’t do that from the get-go, they leave and forget about the app even sooner.
All in all, as of 2020, if you want to have a slice of pie named consumer’s wallet — you need to find your way INTO THE MESSENGERS and not waste time on creating a standalone app. Your chances of high user engagement, retention, and LTV are higher if they don’t have to leave the default apps and spend even more mental energy on unnecessary choices.
If your service exists as an extension right in the messenger, you will get a growing daily engagement since your existing and potential consumers are already glued to the app for a multitude of reasons. And if your service does a good job of reducing the anxiety levels of the day-to-day living in this age of never-ending information, users will be thankful and pay you additional attention/time/money. In the attention economy, this is crucial for long term success.
That is why Russian bank Tinkoff, for instance, offers useful financial “stories” in Instagram/Snapchat format and is currently turning its banking app into a super app, looking up to Chinese social and economic giants’ success. The more “hooked” you are, the more money you spend or, the more ads you watch there.
So integrating with the messengers, you can avoid the attention scarcity and (partly) user retention problem, providing your services right within the most used consumer apps. If not applicable to all businesses and apps/services, it would be an excellent idea for routine consumer banking, transactions, and invoices. The simplest interfaces, the fastest interactions around one’s social circle, would make messenger banking a perfect solution for the overwhelmed world. Also, it’s much easier to say “Send Mary $10” to Siri than search for an app, log in, and go through 10 unnecessary steps (I’ve covered that in detail in another article).
Time will show, but as we acquire more and more partners and investors, we are slowly validating the dormant demand for such service, hoping to bring swift messenger banking experience to everyone as soon as possible.
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