This article is part of a VB Lab Insights series paid for by Capital One.
Who doesn’t love one-click purchases? Today we no longer have to search for our wallet or check on our phone where our credit card number is stored on the online checkout page. We don’t have to parse our delivery address from our billing address. Gone are the days of friction-laden online shopping.
Digital wallets and similar payment technologies have virtually eliminated the need for deep stacks of cards and bills in pockets and wallets. Indeed, they have taken the world by storm: the payment volume of digital wallets is expected to grow by almost 40% by 2024, after which it will will account for approximately 41% of all e-commerce payments.
But when it’s easier to spend, we tend to spend more. And that’s not always a good thing if we’re not sure where our money is going. The University of Illinois Urbana-Champaign found that when consumers first started using mobile wallets, we completed 23.5% more transactions, most of which were on cheap items; therefore our total expenses increased by 2.4%.
So while digital wallets eliminate friction and allow for more spending, it comes at a price: uncertainty, confusion, and a lack of confidence that we really know what we’re spending our money on. Have you counted how many streaming services and autofill products you’re paying right now? The advent of one-click spending has created its own challenges. Ensuring the well-being of the entire customer will be the next frontier for brands looking to create differentiated value.
With a people-centric approach to experiencing design in digital releases, there is incredible potential to rethink how consumers can gain greater confidence and control over their finances, while maintaining simplicity and driving business results.
How great experience design can help meet customers’ core needs
People-oriented designers approach every problem from the perspective of the human user. We start by considering what they need (and sometimes what they don’t know they need) from a particular experience. When I think of great design in consumer finance, it’s not just transactional. I am thinking of experiences that enable clients to realize their goals and ambitions. If my team and I understand what our customers’ spending is for, we can essentially help them achieve that through experience design.
Here’s a framework of the key design considerations we’ve come up with, based on what customers want and need today:
- Clarity: Find and eliminate the invisible inefficiencies in customers’ spending experience. Many of us make payments through multiple accounts, payment plans, apps, and merchants. It’s no wonder it can be easy to lose track. The design should help users navigate these invisible culprits or design them completely OUT of the experience.
- To trust: remove the mental/emotional strain that can come with spending by helping people differentiate between the spending they must do, must doand want to do. Many of us are constantly faced with the tension of navigating expenses around things that just need to be done (bills and unexpected home repairs); things to spend (saving for children’s education fund); and things we choose to splurge on (a night out on the town, a fancy new coffee maker). Give users insights in the moments that really matter so they can prioritize their spending accordingly.
- Control: Make sure a customer’s spend matches the rules they’ve set for it. Giving users control over their spending is perhaps the most challenging part to realize, for two reasons: 1) the rules, guardrails, and mental models people apply to their spending are idiosyncratic based on their personal financial situation and values; and 2) consumers generally resist investing time and energy in: controlling their money. A user interface that delivers interconnected help, powered by data and machine learning, can be more useful than a set of disparate tools and features.
Let’s take a few hypothetical examples of what this could look like – these are all areas we explore at Capital One. What if it were possible to give customers more insight into upcoming subscription renewals, and — with just a few taps — the ability to prevent renewals from happening automatically without their consent?
Or what if the customer could easily see all invoices and subscriptions that are due before being charged – and make the necessary changes before being charged? This can help customers save time and effort managing subscriptions by tracking them and keeping that information all in one place.
How experience becomes a competitive lever
Most companies today have access to advanced technology. But how brands design and deliver experiences can be a real differentiator. The experience of spending your hard-earned dollars on a particular brand is one of the most intimate and important ways a company interacts with its customers. It requires deep trust on the part of the customer, especially when they select which brand they want to do business with. In today’s world, trust is very important.
Empathetic and people-oriented design can communicate and deliver on brand value and choices – a signal to the customer that they are both understood and in good hands. While many brands may not want their customers to scrutinize their spending too deeply, we see a great opportunity to bring greater humanity, trust and control to the well-being of customers and the companies they entrust.
Jason Ferrell is Managing Vice President and Head of Design for Card & Consumer Bank at Capital One.
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