Your IndustryApr 24 2014

Facebook and the future of advice

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While heavily bank-orientated, with a strong emphasis on banking security – a good thing for consumers and banks – Finovate pointed to some interesting market norms. Many of the presentations at the conference relied on smartphones (principally Samsung), apps and Facebook. It seems banks believe everyone is a Facebook fan, and this says a lot about their target market.

Over the years friends and colleagues have tried to get me excited about Facebook. While I recognise the advantages – my six children swear by it for keeping in touch with their friends – I find it intrusive and unnatural. Clearly I am a dinosaur when it comes to Facebook, but I recognise its success and, from a marketing viewpoint, I fully understand the opportunities it can present to firms.

Interestingly, the Finovate presentation from Excess Return showed how it used Facebook to improve security. This was achieved by looking up customers on Facebook and seeing what they were talking about or doing. If a customer was sharing holiday photos from Rome, he or she could not be simultaneously in New York buying an expensive watch.

Perhaps my attitude to Facebook is an age or profile issue, but interestingly at Beaufort (the IFA firm where I am a non-executive director) most of the e-enquiries we receive come from LinkedIn rather than Facebook. Our clients are business focused, but are we missing the Facebook generation? Probably, and I guess the Facebook generation represents a large number of those in the ‘advice gap’.

The second general point about the presentations at Finovate was the academic prowess of the presenters. As I noted last year, I was amazed by the number of presenters from overseas who were able to give flawless presentations in English. English really is the international language, but it was not just the presenters’ ability in languages that was impressive – many were also highly qualified.

Take, for example, the three German co-founders of Vaamo, who have backgrounds in strategy, investment banking and academia. They have developed a web application, which they claim helps individuals achieve their financial goals, rather than just being a site that flogs products. The demonstration showed an application that looked easy to use and was intuitive. The use of exchange traded funds (to keep costs down) also felt appropriate. When I spoke to them afterwards I was not surprised to find all three had PhDs. Technology and academia clearly go together.

Not all presenters were academics, though. The most glamorous presentation came from a Russian company, LifePay. It offers a payment solution based around mobiles. To demonstrate the success of its product it asked one of its clients, Elena Spirina, to give the presentation. Her business story was worth listening to, as it focused on how LifePay had helped her build up her successful clothing business in Russia.

I was surprised both this year and last with the very low-key marketing by the exhibitors. The FCA’s stance on incentives did not apply to Finovate, so I was a little surprised there were almost no promotional giveaways, although I did receive one free gift before the conference. The package was the size and shape of an iPad, but on opening the box, I found it was an iPad made from Lego.

The only other advice-orientated presentation came from the Hungarian IND Group, another provider of mobile banking solutions, which, just prior to the conference, had been purchased by Misys. However, the presentation was too robotic for my tastes and was more sales than advice, but for its target market of banks it did offer potential.

Overall, Finovate was an interesting conference with some great presentations and I am sure we will come to use many of the technologies exhibited in the years ahead.

Dr Peter Williams is an independent business consultant and chartered financial planner

Key points

- Banks believe everyone is a Facebook fan and this says a lot about their target market.

- English is the international language, but many presenters at Finovate were also highly qualified.

- There were almost no promotional giveaways at Finovate.