As Money2020 concludes its 5th big show focusing on the new role of tech-based services in payments and marketing, FinTech has stalled for the SMB marketing channel.
Once thought of as a game changer and disrupter for SMB marketing – and a key component in their very real move towards CRM — FinTech hasn’t really moved the needle much for SMBs in the five years we’ve been watching it. FinTech includes customer transaction analytics, prepaid deals, loyalty programs, card linked offers, small business loan programs and alternative payment services.
Here are four areas where we’ve seen a real stall:
1: Alternative Payments: Square, Apple Pay and Google Wallet are processing a lot of SMB payments. But nobody could argue that they are changing marketing or operating efforts.
2: “Transaction marketing”: Sale of goods based on transactions –aka card linked offers – hasn’t made much headway, even after millions of dollars of marketing by players such as Bank of America. It certainly hasn’t generated enough leads or sales to cut into SMBs ad budgets.
3: “Close the Loop” transaction information: Big data players incorporating transaction information haven’t made much of a dent. Most of these programs remain too expensive for SMBs.
4: App-based loyalty programs: Unless you are a coffee shop, these haven’t become core to the marketing efforts of most SMBs. In fact, “loyalty” isn’t even used in pitches for online to offline efforts anymore.
But is it too soon to give up? Yes, of course. As we move towards boundary-less, SaaS services, FinTech remains one of the most exciting parts of the emerging SMB ecosystem. We see it in the increased acceptance of Square and PayPal by all size of companies as they go omni-channel, and the instant recognition of customers and their reviews, and emailed receipts.
We also see it with First Data’s Clover point of sales units, which announced this week at Money2020 that it can now process delivery sales for Amazon Restaurants. We also see it in credit card acceptance in cabs that includes receipt print outs that include local entertainment options. Most importantly, we see its use in Artificial Intelligence-based automation that will make local scale.
Right now, FinTech is mostly useful in helping banks, credit card companies and Point of Sales players provide Web-based services. These remain important players in themselves, but they are still locked in their financial silos, and don’t make a general impact. We’ll see it changing – perhaps slower than we had initially envisioned — as cloud-based SaaS services becoming the norm.