Meeting customers where they are: Do you assume your new customers know how to use a credit card?

April is Financial Literacy Month. As experts in marketing financial services, we’re big believers in financial services brands having an obligation to help its customers first and foremost. And ultimately, that help should yield financial literacy in some small or large way. But like all service-oriented brands, there is no one-size fits all when it comes to financial literacy – what’s most important is meeting your prospects and customers where they are and providing the specific help they need.

For Financial Literacy Month this year, we’re sharing a series of articles with some thought starters for you to consider for how you can help both prospects and customers where they are on their financial journey. Ultimately, we think the brands that are most successful with delivering help will set both themselves and their customers up for success.

The other day my stepdaughter shared with me her frustration with her credit card. The problem? She didn’t know how to pay the bill. She wanted to pay off her current balance and kept receiving a message that she couldn’t. That didn’t make a lot of sense to me, so I sat with her as she walked through the steps she was taking.

Here’s what I discovered: she has literally no idea how credit cards work. For instance:

• The difference between “statement balance” and “current balance” was a mystery. She thought she always owed the current balance on the due date.
• In an effort to never carry a balance she kept paying more than her statement balance before the due date. As a result, she was constantly in a state of having credit with the issuer.
• The kicker? We ultimately discovered she couldn’t pay off her balance because she had also set the account to autopay each month. Every time she tried to pay the full balance manually, it wouldn’t let her. While it was great to have a safeguard in place so she didn’t pay twice, there was definitely a missed opportunity to explain what was going on and offer help.
• She was actually doing all the above out of fear of using up her credit line and not being able to continue to use the card each month. And instead, she ended up frustrated with the brand.

I was amazed at how little she understood how credit cards work. And then I was amazed at the fact I was amazed. How would she know how they work? If the bank doesn’t do it, who helps people understand credit card statements and how to use them?

My stepdaughter is a “Zillennial”, falling in the group of folks which straddles Gen Z and Millennials. A study from last year showed that Zillennials, despite being just a micro-demographic group, have distinct financial needs from both Gen Z and Millennials, including needing more help in managing their money during uncertain times, helping build a strong credit score, and knowing how to manage debt. Those differences reminded me that while bucketing everyone and treating them like a monolithic group may be easy, it’s done at the expense of delivering help to people at earlier stages of their financial journey.

This all underscores why we tell our financial services clients that they need to meet their customers where they are in their financial journey. That means things like:

• Ensure they have ways to gain understanding about the product they are using from you. As I navigated that card app, I realized there were no tool tips or links or opportunities to easily engage customer service (real or bot) to help answer some of her fundamental questions. That’s a miss.
• Pick up on signals and provide better help that way. Always paying more than your statement balance? That could trigger a suggestion to change the amount on the autopay feature, or maybe trigger an exchange about the possibility of raising her credit limit.
• Remember that most people engage with your products very infrequently. Don’t assume that they always remember the nuances of their account, or what standard terminology means, or even how they should use your product to their best advantage. Be proactive in giving them the information and tools they need to use your products well.
• Looking to acquire new customers? Forget the traditional funnel. Map your audience’s needs to what you need to provide them to help them make an informed decision in that moment, and then deliver that information at the right time, in the right place.

If you can meet people where they are, and help them in their journey, the rewards for both of you are significant.