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Between the ages of thirteen and a half and fourteen and a half there was only one place, especially for geeky kids like me who lived in my particular part of East London, to spend their weekday lunchtimes…
About a 10 minute walk away from my school was a ‘video shop’
Whilst the shelves were stacked of VHS tapes of all manner of films, including the obligatory stack of dodgy 1980’s ‘horror’ films (is it me, but we’re 1980’s horror films so bad they were ultimately very good, or am I just being nostalgic?) two large black boxes which sat pride of place in the middle of the shop.
On top of the two shiny black boxes were two illuminated signs. One said
“Mortal Kombat”
and the other said…
“Street Fighter 2 – The World Warrior”
Surrounding these boxes we’re usually crowds of kids, shiny twenty pence pieces in hand, ready to challenge the reigning champion on each game.
Every couple of minutes someone on each black shiny box lost their game only to be replaced by another eager teenage, 20p in hand, being prepared to Uppercut (however if you use it’s proper street fighter term – “Ahhh-Yu-Ken”) on Street fighter or hear the dulcet tones of the announcer looking for you to finish your opponent on Mortal Kombat.
I remember looking at the video shop owner, Mr Callebrero, from time to time and noticing something strange. Whilst understandably quite grumpy about having loads of teenage boys invade his shop ever lunchtime (and often after school) he always had a smile on his face, he was always begrudgingly welcoming and always had plenty of change behind the counter for every kid who asked him “Mr Callebrero….you got change for a pound?”
Looking back, I wonder if he was thinking
“Look at this! I’m onto something here! Kids are shoveling money into these machines and are falling over themselves to challenge each other! Let’s hope it last forever”
However it didn’t last forever. Actually it didn’t long at all….
In 1994, 2 years after the arcade version of Mortal Kombat and Street Fighter 2, the Playstation was released. Whilst the Playstation wasn’t the first stay at home gaming machine it was one of the first which provided close to ‘arcade quality’ experiences which meant one thing…
Kids didn’t need to shovel cash into arcade machines anymore they could buy a game and play to their hearts content in their own homes. Also they could save a bit of cash for their pals by inviting them around too.
Now, I can download any particular game from the late 1980’s and early 1990’s directly onto my phone, usually for ‘free’.
Now, whilst you’ve come with me on this particular journey around gaming memory lane it’s probably important to point out the relevance of this particular article.
Innovation is occurring everywhere. Technology has changed, and is changing the game in so many markets in so many sectors across the world. However I reckon when it comes to certain aspects of financial services, we’re a tad behind the curve.
However when it comes specifically to how gaming has changed can we learn any lessons and apply them can we apply any of the innovations in this particular market to financial planning or advice? I reckon we can…
1. Games are easier to buy
In my early gaming days I had to travel to my local gaming establishment put my money in a arcade machine and play a game.
Post 1994 I had to travel to the shop, pay my cash, wait until I get home and the game was mine to own and play.
Recently all I’ve had to do is touch a couple of buttons on my phone or console and job, as they say, is a good-un!
The same applies to all entertainment content.
Gone are the days when I had to pop down to Mr Callbrero’s video shop to rent, and then travel home, and then watch a film….I just download one from a bunch of streaming services either onto my laptop or one of the many boxes attached to my telly.
However financial planning and advice hasn’t on the whole hasn’t been on the same ‘easy to buy’ journey. This means that often processes in financial planning have remained long winded and restrictive.
Now buying games is a quicker, slicker and easier process.
I wonder if we can innovate our businesses to make it easier to engage with and ‘buy from’?
One of the obvious restrictions is cost. Which is the next change worth highlighting…
2. Games are now sold differently
I’ve got a monthly membership contract on my particular gaming console of choice. It costs me less than a tenner a month. For this subscription three games per month are delivered to my console ready to play.
I get most of my entertainment delivered this way. I use Amazon Prime which gives me access to masses of choice to a wide range of film and telly box sets. I use my monthly Spotify subscription to access millions of music tracks streamed to my PC or downloaded onto my phone.
Any games, or films, or songs I don’t have access to I’ll happy to pay a little extra for but the wide range of choice provided by these services mean it’s relatively rare for me to need to.
The traditional media have even started adopting this model en masse by either deciding to distribute content via a subscription model (like the Times) or via an advertiser paid model (like the Metro). Also, much of the software we buy is either distributed using this model or is moving in this direction.
So buying games (or much else for that matter) is now not only quicker, but it’s also flipped it’s traditional model on it’s head in a couple of ways. Firstly a lot of games are distributed by subscription or are free and secondly they have made gaming accessible to way more people.
In addition to this the ‘free’ games aren’t free at all. These games are cleverly designed to be massively engaging (even addictive?) by making playing the game really enjoyable, then paid for by micro transactions to enhance the functionality of the game.
So buying games are lower in cost and distributed in completely different ways to once was.
I wonder what changes we could make to ensure high quality financial planning are available to more people than ever before? and to reduce the cost barrier to entry?
Now let me make an important distinction here. I’m not talking about a traditional face to face bespoke financial planning model.
The cost of these type of services are dependent on the knowledge and expertise of key individuals but if this knowledge and experience can, in some way, be systemised with additional consultancy services delivered ‘on demand’ at an additional cost this could be a model which not only delivers better outcomes for individuals who don’t currently actively engage with a financial planning service but also longer term a steady flow of new clients into a bespoke financial planning model when their needs get too complex.
However for any ‘mass model’ distribution there’s a key question which is tough to answer? How can a model like this be distributed and marketed
I’m not sure…however does another sneaky peak towards gaming provide any insight?
3. The growth in most recent games has been largely dependent on social engagement (and other ‘growth hacks’)
Anyone with a Facebook account knows instinctively this is true. If you’re like me, you’ll get a request to join ‘candy crush’ or ‘monster legends’ every day from a friend.
Whilst occasionally annoying, most games on all platforms are designed this way and it’s incredibly clever. Who’s better to market your particular product than active users of said product?
Games do this in a variety of ways. From rewarding players to share each and every achievement made in the game to actively helping users who share actively.
Gaming isn’t alone to use this type of viral style of marketing.
Existing clients are already intrinsincly part of how we market our businesses. We use testimonials. We ask for referrals. We impress our clients with outstanding service not only in a desire to do a great job but also to encourage our clients to refer us on.
However can we learn from games and build ‘social’ into our business models and encourage sharing of our service more actively?
Many of the high tech high growth firms (who are keen to avoid high marketing costs but want to develop large numbers of users) have used these techniques.
It’s so popular it’s even got a name for itself. Check out Growth Hacking and especially the book Growth Hacker Marketing for an excellent insight.
So, whilst many financial planning business are using social to engage we currently missing a trick. We don’t build social into our business. Most of us don’t need to. Our models aren’t particular suited for mass market. They don’t need to be.
However then my mind swings back to Mr Callebrero’s video shop.
It doesn’t exist anymore. Both the two arcade machines and his wide collection of VHS’s got superseded by quicker, more efficient, lower cost and easy to share solutions.
Whilst the steady pace of change might be taking slightly longer in financial services than other professions both the conversation around technology, the inefficiencies it can deliver and some of the solutions already delivered illustrate change is truly on it’s way.
Can any of us afford to ignore it?