There’s an unprecedented amount of change happening in digital business right now, and Fidelity’s president of personal investing, Joanna Rotenberg, is at the center of it. With $4 trillion in assets under management, Fidelity competes on a large scale, and it’s up to Rotenberg to help design customized strategies that will help clients manage their money.
Speaking recently at MIT Platform Strategy Summit, Rotenberg said Web3, artificial intelligence, 5G and blockchain are important catalysts for change, especially when coupled with increased digital use among young people.
“Those are some factors that I would say are really important catalysts that are helping us accelerate our thinking about how we go to market,” she said. “It’s a tremendous amount of change.”
Rotenberg was interviewed about Fidelity’s ecosystem strategy by Geoff Parker, a researcher and visiting scholar at MIT’s Digital Economy Initiative.
Here are five tips from Rotenberg on how to build a successful digital platform.
1. Serve your customers where they are.
Fidelity has clients who “insist on meeting face-to-face,” Rotenberg said. Others take their iPhones to make a purchase or do research. Fidelity needs to meet the needs of both groups, and often, that means doing so in creative ways, such as finding and serving Internet insights on Twitter and more non-traditional places for banks, like TikTok and Reddit.
“Reddit is a particular area where we’ve been quite active in community building,” Rotenberg said. “I saw a statistic this morning that said a lot of Gen Z is using TikTok and Instagram to be able to fulfill their research needs. And so this is a great example that we need to meet our customers of today and tomorrow where they are.”
Whether it’s answering their questions or solving service issues, “we’re starting to think a lot more broadly than just some of the things we can do over the phone on our sites, but also making sure we’re we meet them where they are. and we think that’s going to be a critical part of the future.”
2. Build a healthy ecosystem.
Rotenberg compared Fidelity’s ecosystem to baking a cake: “If you don’t have the right ingredients, it’s not going to be great, and it doesn’t matter what kind of frosting you put on it.”
Fidelity’s digital business mantra is “scan, test, scale,” which Rotenberg said means “scanning the universe, thinking about where the world is going, investing in applied technologies and being able to test and incubate those skills.” To do this, the company established Fidelity Labs – an internal software incubator that develops technology solutions to better serve customers.
A healthy ecosystem also means finding new talent and cultivating it from within. “We’re spending a lot of time thinking about all the talent out there, and not just finding new talent,” but also thinking about how we create it on our walls, she said.
Above all, it’s important to make sure you have the right processes and the right data in place. “These will only be very important parts,” she said.
3. Use data to create value.
“Data is everything to us,” Rotenberg said. Ensuring that you have high-quality data that you can continuously iterate and improve on should be a priority when building a platform. “This is something we spend a lot of time on because it’s such an important foundation,” she said.
One way the company uses it is to personalize the experience for customers. For example, this could mean using digital credentials. It may sound simple, but having the right mobile phone number means Fidelity can interact with customers the way they want. “Sometimes it’s the most basic things that make the biggest difference,” she said.
4. Measure the right things.
Fidelity measures success and performance metrics in a variety of rigorous ways. One of them is to think about the value of a customer’s life and stay patient; profits may not always be immediate when you acquire customers.
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With younger customers, for example, Rotenberg asks, “How are we serving them in an experiential way that improves satisfaction? How are we lowering our cost to serve?” This group, while new, is valuable because “we’re going to keep them around longer, we’re going to have a longer relationship, but they’re naturally going to be smaller to begin with, in terms of relationship size ,” Rotenberg said. “We are ‘patient capital,’ [and] this is important to us.”
5. Learn from your competitors.
Like many traditional banks and investment houses, Fidelity is often asked about competitive threats from financial technology startups. As fintechs continue to gain market share, Rotenberg said it’s important to pay attention to what they “get right that we can emulate.”
There are many different ways that fintechs and Fidelity can work with or against each other. “A fintech can be our competitor, our vendor, [or] we can also be customers, and vice versa,” she said.
Successful fintechs, in particular, have usually gotten something right in terms of a “customer friction” that other firms have not understood. “They delve into understanding friction, create success, and then explode out,” Rotenberg said. “That’s something that I think we benefit from because we’re always raising our bar in terms of competition. Deep understanding of a customer insight that others may have missed should be where we are playing as well.”
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