Banco Familiar Case Study

How can we bring the youth back to the banks?

For many years, the banking business has remained the same. A savings account is a savings account and a checking account is a checking account. The banking products only changed a bit until the last few years, when everything started to transform rapidly. In the past, clients came to us but nowadays we have to attract and invite them. The cycle between opportunity and competition has shortened enormously. Therefore, we need to be more commercially effective, hear out clients’ issues, and design technology solutions to solve those problems.

The bank’s innovation area contacted us and proposed a clear objective: find an opportunity in the Paraguayan market and design a digital product from scratch that includes both banked and unbanked segments.

One of the biggest risks of building a product is building the wrong thing. Spending months building it, only to find that it just doesn’t work is too risky. Since we were creating a totally new product and the market had very little financial education, we followed Lean Product Validation strategies to create a product that maximizes the chances of success:

1 Validate the problem.

Is this a problem worth solving? If users don’t think this is a major problem, your solution won’t be appealing.

2 Validate the market.

Some users might agree that this is a problem worth solving. But are there enough of them to make up a market for your product?

3 Validate the product.

The problem might exist, but does your product actually solve it?

4 Validate willingness to pay.

There might be market demand and a great product. But will people actually be willing to reach into their wallets and pay for it?

1 Validate the problem.

According to a World Bank report, the banking penetration rate in Paraguay is in the order of 39% and this figure, below the average for the region, is linked to informality and low exposure to technology. This gave us the idea that the challenge was going to be great.

In the first instance, we conducted interviews and activities that allowed us to fully understand the concerns of potential customers. What was the objective? Find the ideal product for the ideal segment.

We conducted open interviews in various locations in Paraguay, defined a wide range of segments, prepared a strategy, and went out looking for users both at the bank’s branches and on the street where we conducted in-depth individual interviews.

Once we had some information, we conducted structured interviews focused on customs, financial education, and the relationship with technology.

2 Validate the market.

The first thing we did in the second stage was an in-depth market benchmark to see how the competition was dealing with the same problem.

Analyzing the potential market allowed us to make an educated guess about the size of their target audience and the number of customers that could be acquired.

This also helped to think of a price structure to make financial projections with the bank team.

We captured a lot of information about the market and about the business, many initiatives that demanded different efforts arose from this, and we found the ideal segment that we were looking for:

How can we improve and add ideas?

When it comes to thinking and designing a product, the main flaw of big and regulated organizations, which have mature businesses (as the financial sector), is that products are designed according to operational processes. I am sure that you, dear reader, learned how to manage based on learned assumptions, and, surely, your systems are just like your organization.

The techniques of Design Thinking aim to win some perspective and create distance from the reality that includes us all.

For this reason, we carry out activities to find creative ideas outside of the organization’s microenvironment. Product in a box is an activity of this kind that we enjoy a lot.

With Banco Familiar, we began this workshop presenting the findings obtained in the research stage within the chosen segment potential. Many good ideas came up from this activity.

How can we evaluate initiatives?

There are different ways of prioritizing initiatives depending on the organization’s strategy. When evaluated in business terms, these are the three main criteria:

  1. Implementation effort (only a preliminary evaluation or informed estimation)
  2. Business impact (revenue generation)
  3. The investment. How much can I invest in these initiatives?

Based on the criteria we qualified and prioritized the initiatives along with Banco Familiar’s team. Which was the result? The best option we found was a mobile solution for a specific segment of the market with very clear needs that had to be covered.

3 Validate the product.

With Banco Familiar we designed several prototypes with interaction flows, and we tested them with the segment with the best acceptance. After each test, we improved the ideas and retested them until we obtained an application that exceeded the efficiency and satisfaction rates that we set as a goal at the beginning of the project.

The Task Completion Rate of the prototype, that is, the percentage of efficiency to do the most relevant tasks, exceeded 95% efficiency, surpassing the average of 82% of other more mature markets. This gave us the certainty that we were on the right track.

These are the elements we use to create an interactive prototype and to test ideas quickly:

  • Businesses’ goals
  • Users’ feedback
  • Good market experiences
  • Ideas are taken from Design Thinking activities
  • A platform to create prototypes (in our case, InVision)

We designed several prototypes with different interaction flows for Banco Familiar’s project.  We tested them with the segment that presented the best acceptance. Do you remember the investigation stage? After each test, we improved ideas and retried them until we came up with an application that surpasses the effectiveness and satisfaction rates that had been settled as a goal at the beginning of the project.

Tip: The process to create a product has to be agile. Therefore, we can create a video to present tests’ results, a simple tool that has a great impact. The video must include the users’ reactions while using the prototype. This is an alternative to a boring and time-consuming report.

How can we differentiate our app in the market?

When creating the prototype, we can test interaction but also personality guidelines. As I said before in my article Identity First Design, “Personality is at the heart of every interaction. It is what defines each person as an individual making them stand out from the rest and making each human relationship unique and incomparable. The cues that we recognize in others (voice tone, language, looks, body posture, etc.) can also be found in a product such as an app or a website. Color, typography, images, writing composition, interactions, and sounds are all signs where we can unconsciously detect that digital personality.”

With our strategy team, we were able to identify a series of values that stand out and make the product desirable, by focusing on the interests and expectations of the user towards the service, this defined the cardinal features of the application. For this reason, we write the guidelines of personality, tone, voice, level of questioning, level of informality, etc.

At the same time, we write the Positioning Statement. The positioning statement briefly describes the most compelling benefits of the product from an emotional and functional side to the audience. It requires the identification of the point of differentiation with respect to the competition and establishing our north.

All this allowed us to have a solid framework to build branding guidelines and product design.

How to make a product come alive through visual design?

Finally, we designed the visual part of the app. Using personality as our guide: we chose color schemes and fonts, highlighted elements hierarchies, and worked on branding.

We created illustrations to boost the speech’s strength and to highlight the brand’s distinguished values that make it original, unique, and unforgettable.

4 Validate willingness to pay.

To find out if there was acceptance of people to consume the product, we prepared mock sales pages with these characteristics:

  • They explained everything the product did clearly and precisely.
  • They highlighted the unique sales differentials of the product.
  • They addressed all the key concerns that users had during user testing.

The goal of our process was to delay expensive and time-consuming development work, minimizing costs. We created a product with very good chances of a successful launch for a specific segment that can drive change in a conservative market.