Wednesday, 20 July 2016

Gotta Catch ‘em All: Pokémon Go and the Banking Industry

If you had told us that you had never heard of Pokémon Go, especially after the month and a half the new application from Nintendo has had, we at IBS Journal wouldn’t believe you. The alternative reality game has had children and adults alike enraptured, following their phones around outside hoping to catch elusive Pokémon at local landmarks.

Explosive would be the right word to describe just how much of a phenomenon Pokémon Go has become overnight. Not only has it been downloaded in record numbers, but it is being used more often per day than the most popular apps of all time. The app almost has as many daily users as Twitter and the search term “Pokémon Go” and its derivatives have overtaken the most entrenched top Google searches, including those for pornography.

The application is an excellent example of capturing and holding an audience that relies increasingly on integration with technology. Sound familiar? It should. There has been a perceptively large push towards the digital in the finance industry in the past few years. So how can catching Pokémon in the park help us understand FinTech? Read on and we’ll enlighten you.

Let’s start with the obvious: gamification. At its heart, Pokémon Go is a very simple premise: walk around to catch Pokémon and battle others at gyms. However, it has done something that hundreds of apps and even government programs have failed to do – get people outside and exercising.

There’s no reason why perceptible rewards, progression systems and an attractive user interface cannot be ported into the functions of banking that many consumers see as time-consuming and irritating. Rewarding a user for meeting their savings goals or for budgeting correctly adds a layer of interactivity with their bank that might otherwise be missing. “You’re a level six Pokémon trainer” isn’t too different from “You’re a level 6 savings expert”, is it?

Augmented reality (AR) is a tool that has been rarely used by banks. Yet it is a cornerstone of Pokémon Go, teleporting an abstract concept (portable monsters that are shaped like flaming lizards or electric mice) into the real world for a player to interact with. Despite the technology used by Nintendo and developers Niantic Labs being basic in nature, there’s no reason why this early tech cannot be improved upon. For example, a customer downloads their bank’s app and wants to find their nearest branch. The app turns on the user’s camera and overlays the image they see with a path to the nearest location. Alternatively, a user could use their camera and AR tech to see where unique offers from their bank can be found on the High Street.

Pokémon Go has trumped banks slightly with its excellent use of geolocation data. The app uses a phone’s GPS to track the player’s movements around a map (the data for which is downloaded from partner firm Google). These player movements create a web of information on their user, including where they live, their most frequent journeys and where they go in their spare time. Pokémon Go uses this data to populate the world around the player with virtual monsters, but a canny bank could use it to offer unique rewards and location-based offers. What’s more, the data can be a force for risk management and data security. What if suddenly your customer’s location is no longer in their native North London where they live and work, but has moved to south of the city without an address change? Perhaps that’s a good time to ask your customer if he or she has lost their phone or had it stolen and nip any fraudulent activity in the bud.

The sheer popularity of Pokémon Go, and the reaction to it by businesses, should also give banks a lesson in how proper engagement with the wider community, not just users, can be a boon. There is a Pokémon Gym outside of my flat in Islington based in a pub. I spoke to the landlord in the pub opposite it on the street and he told me how annoyed he was that his pub hadn’t been chosen. There are rumours that Niantic Labs will be implementing a sponsorship system where companies can pay to be activated as gyms, something they would no doubt queue up for. Others have created Pokémon-specific offers for players like offering free pizza for trainers with more than 50 Pokémon caught.

This kind of engagement may seem like a tangential thing to a bank’s operational strategy, yet they are uniquely positioned in the reams of data they hold about their customers. Offering rewards or cross-selling products based on a user’s lifestyle could be a powerful tool in capturing and holding new customers. Pokémon Go rewards its players for getting out and discovering the world around them, so why shouldn’t banks? Utilising the factors that have made Pokémon Go so sensationally popular will truly enable banks to catch ‘em all.

Alex Hamilton


IBS Journal / IBS Intelligence

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