‘Boring is brilliant’: It’s a phrase unlikely to trigger excitement in the hearts of many marketing leaders.
But it’s this commitment to consistency and simplicity Stockspot’s CMO, Melanie Novacan, sees as core to the fintech’s customer advocacy-led marketing approach. And it’s one she’s hoping will transform attitudes Australian consumers have towards their future financial selves.
The former director of marketing for on-demand content service, Stan, and most recently, go-to-market adviser for Aussie HR software startup, Deputy, became director of marketing at Stockspot six months ago. It’s a role taking advantage Novacan’s experience as a marketer as well as in financial services, including stints with ING Direct and Commonwealth Bank’s CommSec division.
Stockspot itself is a five-year-old homegrown fintech focused on ‘robo-advisory’ services, or automated investment advisory services to individuals.The company is among a number of next-generation banking and investment players emerging out of digital and mobile disruption.
Technology isn’t the only thing shaking up financial services, of course. Just last week, Australia’s larger, traditional banking, insurance and superannuation giants copped an almighty serve through the Federal Government’s Royal Commission, a long overdue investigation into severe wrongdoing throughout the sector.
In addition, the impending launch this year of Australia’s Open Banking Regime, which sees consumers given greater control of their transactional data, opens up further opportunity for new financial services to flourish.
Novacan, for one, sees the Royal Commission as a positive for Stockspot. “The opportunity is there for a brand that has the best interests of Australians at heart, and pivots its entire business model, products and decision making on that,” she tells CMO.
“The whole ethos of Stockspot is ‘boring is brilliant’. We take things and automate them. It’s not a sexy proposition, but increasingly, consumers and Australians are taking notice of what’s going on with their finances and we’re there to help.
“In the current economic environment with property prices, market fluctuations and so much uncertainty, knowing there is someone offering certainly is a big deal. Our brand prides itself on consumer advocacy, being their champion, and building a product that has their best interests at heart.”
It’s for these reasons Novacan says Stockspot’s marketing approach must be completely reliant on customer advocacy.
“The growth for most finance brands moving forward is going to come from organic growth, such as word-of-mouth, referrals and reputation,” she says. “That loyalty, trust and advocacy is going to be the number one thing setting a brand apart in the finance category moving forward. We see that at Stockspot.”
In fact, more than 50 per cent of Stockspot’s growth is coming from existing clients referring on friends and family.
“Often, you’ll have the 30-year old entrepreneur who’s so busy getting his business up and running he needs someone else to manage his investments. Then he sees what a great job we do with it, and gets his mum or dad to move the portfolio over. So those big balanced portfolios come from a referral from our community,” Novacan says.
But while Stockspot has been chalking up relatively steady growth of 5 per cent a month as a result, the group has strong ambitions to accelerate its trajectory.
As a first step, Novacan has been working to build out Stockspot’s customer insights to build tailored go-to-market strategies. She notes three segments, the dominant being consumers new to investing. These are commonly people in their 20s and 30s starting to accumulate wealth, who can’t get into the Sydney property market, for example, and are looking for other ways to grow their financial footprint.
About 60 per cent of Stockspot’s growth has been from these customers to date. “Many work in IT, so they’re software developers, engineers or they’re running their own businesses. They get the benefits of algorithms and automated advice and things that can be done so much more efficiently online by a computer, and that costs are much lower as a consequence,” Novacan explains.
More recently, Stockspot’s customer base has expanded to include older consumers struggling to manage existing investment portfolios, or those who have a managed fund and are looking for ways to improve returns. Today, the average balance managed by Stockspot per customer is about $50,000.
Novacan says the aim now is to double the size of the business in 18 months’ time ideally by successfully doubling the size of clients’ returns.
The role of content
Building content informing consumers how to be more financially well-off is therefore vital. “We are a content, organic-led growth business and there’s a big education role to play,” Novacan continues.
“Any paid activity is usually to highlight something important going on in the category or industry we are trying to champion.”
Top of the list of content initiatives for Stockspot has been founder and CEO, Chris Brycki’s annual Fat Cat Report. The report analyses more than 4000 superannuation funds and ranks them in terms of lowest and highest charges in order raise awareness of onerous management costs being incurred by Australian policy holders.
“We don’t manage superannuation, but Chris recognised it as a huge issue for Australians. There are 10 million untouched superannuation accounts nationally,” Novacan says. “That’s the approach we’re building our brand on: To constantly be the consumer’s champion.”
From a brand messaging and hierarchy perspective, meanwhile, the emphasis is increasingly on asking people to think differently.
“We want you to think about is falling in love with your future financial service,” Novacan explains. “An investment is about your future. It’s making sacrifices today to set yourself up to build wealth for your future, or your childrens’. In this day and age, getting people to think about 10 years’ time is tough. It’s why the superannuation industry has gotten away with things for so long – people can be so complacent about their finances. It’s complex and hard to navigate.
“From a marketing perspective, it’s about how we create a sea change for people to think about their future. Everyone’s milestones will be different but that’s the challenge – how to get people to fall in love with their future selves and move beyond instant gratification.”
Novacan cites two core ingredients: Stockspot’s commitment to a proposition that improves a consumer’s life; and tapping into rising tribalism and society’s quest for purpose. An example she points to is the launch in January of Stockspot’s first ‘savings’ product – an exchange traded fund which invests a customer’s cash in order to maximise returns.
As well as being a direct response to customer feedback, Novacan says the product is being offered solely to existing clients initially.
“There were a couple of different products we were investigating but the savings product was one we could turn on quickly, that the infrastructure already existed for, and that our existing clients were calling out for. The number one source of product inspiration is data from our clients,” she says.
“We do NPS surveys, talk to clients, and our head of advice is on the phone to clients, day in and out. We have a good finger on the pulse of what their needs are outside our core product. The question we ask is: What are things they’re frustrated with? Having money locked in a term deposit for six months frustrates a lot of people. Having a high interest savings account that effectively acts in the same way you trade shares was the result.”
So far, $5 million of client funds is being managed via Stockspot’s savings product. “We need to make sure the experience matches the proposition and expectations of clients. They’ll start talking about it, and that loyalty, trust and advocacy will take us forward. I can’t stress the importance of that first and foremost,” Novacan says.
The second thing helping Stockspot is the concept of tribalism. “There is this whole desire for people to have purpose and meaning in their lives. It doesn’t have to be complicated or complex. In fitness it can be the simple idea of getting out and doing exercise,” Novacan says.
“It’s this search for meaning for life and purpose that will help our message – of simplifying the complexity of everything going on every day while still rewarding consumers – resonate.”
To help, Novacan is updating Stockspot’s visual and digital presence. “That’s in recognition of the changing needs of our clients,” she says.
Novacan also acknowledges Stockspot must tackle the fact it’s not been culturally acceptable historically to talk about financial well-being. One way she’s looking to do this is through partnerships, such as with the Women’s Agenda, encouraging more women to talk openly about their financial future.
“Often, consumers don’t want to let on their full financial situation to colleagues or friends. So we’re looking at how we create this acceptance and cultural willingness to firstly challenge bad financial experiences with brands, and recognise the good experiences, then to talk about it openly,” she says. “Creating a safe platform and forum to have those conversations is big on our agenda this year.
“The Royal Commission feeds into that – you see the media talking about it and it becomes more culturally acceptable to have such a chat around the water cooler. How we reverse cultural cringe around money is key. We need to make it clear that just as important as your health or fitness is your future financial self.
“The media isn’t interested in playing into that story as it’s not sexy, so we’re looking to create headlines the media can latch on to and benefit from equally.”
With several new products in the pipeline, Novacan says she’ll have plenty of fodder to work with in 2019. “But again, it all comes down to what is going to best help our clients, and what is the next best thing we can build for them first,” she says.
Hand-in-hand with the customer proposition is a push by Novacan to accelerate Stockspot’s rapid development appetite. To do this, she’s been working with the business to interrogate data and understand the market and customers, and accelerate test-and-learn internally.
“We are a digital business, so the only way a customer can interact with us is online, so we need to be testing lots of different things,” she says. “As a CMO, you need to show what that opportunity looks like and get teams to a place where it’s comfortable to be uncomfortable every day.
“While we’re only five years old, that agile thinking and methodology wasn’t a priority. But while we are fundamentally a stringent business with protocols, we can be scrappy when we do marketing. We need to try different things, testing different channels and messages.”
It’s for this reason Novacan describes modern CMOs as “creative problem solvers”. “You have to be creative and analytical in equal amounts to solve problems, create opportunities, and come up with great messaging and advertising,” she says.
“As marketers, we’re constantly taking into account subjective as well as objective matters to strike the right balance. At the end of the day, you just have to strike the right chord with your leaders, customers and people – it’s all people centric.”
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