Back in the day, one of the themes that came up time after time in this blog was about people who are in the industry asking too much of people who aren’t. We say things that are too difficult for most to understand and come up with products that are too complicated for most to use.
For decades, the result has been that many of the ideas that we’ve intended for ordinary people have been taken up by people who aren’t ordinary at all. Investment services like Nutrmeg, for example, originally intended fore the inexperienced investor, find to their surprise that their customer base consists largely of exactly the same “hobbyist” customers as existing, mainstream investments. The supposedly mass market Pension Wise guidance service is mostly used by hobbyist retirees fine-tuning their knowledge and their options. A few years ago Stakeholder Pensions, intended as the most mass-market of all long-term investments, were principally adopted by affluent hobbyists as a way of boosting their tax-free contributions (they opened plans in the names of their kids, nannies and cleaners).
It’s early days, but I’d say the signs are that it’s happening again, this time around the big and potentially game-changing idea that’s called Open Banking. So far, I’ve failed to understand more or less all the media coverage that I’ve noticed – but the one message that has come across is that Open Banking makes it easy for me to see the state of all of my finances in one place.
To hobbyists, and crucially within that term I include the very large majority of people working in the industry, that sounds great. It’s a self-evident good. Of course I’d like to be able to see all my finances in one place. It would be really interesting. And useful.
To most of the rest of us, it’s a proposition that’s of no interest at all. We’re not that interested in looking at our financial position at all, whether they’re in one place, or a few places, or lots. It’s about as useful and appealing as being able to look at all our books in one place. Or all our houseplants. Or all our carpets.
These are things that we don’t really look at very much at all, and when we do we’re perfectly happy if they’re not in the same place as other similar things. It’s a bit irritating if we’re looking for a particular book and can’t find it, but it’s not a problem often and we know where to find the ones we refer to frequently.
There are things which it obviously is convenient to keep in one place – clothes, for example, or cutlery, or music (whether physical or virtual). These tend to be things that we need to choose from frequently, and/or to put together in combinations (whether place settings, outfits or playlists). Financial services don’t come into this category.
Once you’ve put your financial products together in one place, there is of course the potential for some enormous second-order benefits. It’s possible to save a great deal of money, to take advantage of propositions that meet your needs much better and do the financial things you need to do a whole lot more easily (I’ve been told a hundred times in the last few months about the imminent arrival of the “one-click mortgage.”
These are all great and exciting things, and could form the basis for simple, understandable propositions that might actually cut through and engage people. (The role model, as so often in this blog, is of course price comparison sites, which have cut through and engaged through a winning combination of simplicity of proposition and hugeness of ad spend.)
It may well be that eventually Open Banking will reduce down into similarly powerful, simple messages expressed with similarly huge ad budgets. But for the time being, it’s hobbyist speaking only unto fellow hobbyist. Most of us absolutely aren’t excited at all.
In the old, pre-sabbatical blog, that would have been the end. However, in the new born-again.blog it isn’t. The plan is now to close, pretty much invariably, with a plug for the book. It includes a lot more on this theme, our habit of asking too much of our customers and over-estimating their level of interest in the financial services world. You can’t pre-order it on Amazon yet – but when you can, you’ll be the first to know.