How the fintech space should take on today's challenges

How the fintech space should take on today's challenges
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Key Takeaways

Welcome to our inaugural Zendrive Expert Spotlight! In this series, we’ll feature Q&As with experts across fintech, home security, insurance, insuretech, and much more. We’ll get top leaders’ insights on the state of their industry (how far we’ve come and where we’re headed), exciting or concerning trends and challenges in their space, and how they’re working towards bettering their industry in their executive roles.

First up: Rachel Petzold, Principal Product Manager at Switchfly,* a company which offers “travel e-commerce solutions that drive customer value and loyalty.” Rachel’s leading an entirely new space at Switchfly, where she’ll be involved in partnerships with new customers as well as the expansion of travel content partners. 

Strategic partnerships and ecosystems across the fintech and consumer apps space – and creating all of the added value that’s connected with them – has been a big focus throughout Rachel’s career. But in her experience, particularly in the past few transformative years, she’s learned that there are many other things the industry needs to be thinking about.

Think: data privacy and the ability for consumers to “opt-out”, fostering more seamless customer experiences, creating truly nimble products, and catering to the changing needs of younger generations of buyers.

*Disclaimer: Rachel's opinions are her own and do not represent those of Switchfly.

Could you start by introducing yourself and your role, and talk a little about the problems your company is trying to solve?

Rachel Petzold: I’m Rachel Petzold, I’m the Principal Product Manager for innovation at Switchfly, which is a platform that provides travel content to airline passengers on airline websites, as secondary content. So, for example, shoppers can book their flights and then immediately book their cars and packages at Disneyland in the same experience. We are the engine behind that content distribution.

I’ve spent a lot of my career in fintech. I’ve been in the space for about 9 years now, starting when I worked in ecommerce for Nike.

What are some of the challenges pertaining to the fintech industry today? 

RP: Industry-wide, I think it’s a really interesting time for us. The bubble has not burst, but has popped a little bit in the new finance space. So things like bitcoin, and new digital payments. There’s a lot of contention in that space. And it makes me think about the fact that you always want your dollars to be safe, and we need to think about ways to make sure that people don’t invest in things that are contentious, or that could lose them their financial stability. 

I know that some of these ideas are really about giving access to consumers, to allow them to not have to walk into a typical bank and do all of the things the way we did them in the past. There are people in the world that don’t have financial stability, and that don’t have access to banking or security. So I love the fact that these net new ideas could be a place where people could get access to banking and financial support they don’t currently have, but I just don’t think we’ve totally figured it out yet.

What’s driving change across your industry/customers? 

RP: Online payments have always been a place where people have been excited but a little bit fearful. I just had a personal experience yesterday, where I tried to book a flight using my credit card for points, and there was a fraud alert because somehow the backend system tried to charge me twice. So I ended up being on hold with support for 40 minutes, before it disconnected me and I had to call back.

So I feel like in this space, and travel specifically, there are so many opportunities for a big purchase and a number of vendors you’re talking to, or you’re paying in a number of different ways, and we just haven’t gotten it right. The bank that I was using sent a text to ask if it was me, and yet it still was considered fraud. So my card couldn’t be used, while I’ve got airline tickets and a car I’m trying to book - and I can’t do anything, I’m stuck. There’s no way for me to verify it’s me, in a totally digital way, even though I’m trying to make a digital payment.

I love the idea of there being more self-serve or self-validations. Then, this morning, it showed that there were two charges for exactly the same thing on my card, because my bank had labeled it as fraud and the airline, or whatever the third-party backend system was, charged me twice because the first charge was still listed as fraud. 

"The connection between systems, and especially the connection between my financial stability, security, and safety, and my ability to be nimble, isn’t fully formed yet in my opinion."

Wow. So that frustrating experience, that lack of seamlessness, is definitely driving change and innovation. Are there any other trends or changes that you’re excited about?

RP: Yes, definitely. So I have a 27-year-old son Sean, who has never had a credit card. I’ve been encouraging him for years to get a prepaid card if he doesn’t want to go get credit and worry about overspending. He finally discovered that there’s a prepaid card he can get that’s virtual, with lots of security protections, and that doesn’t actually have the same challenges for fraud. He can validate it’s him via text message every time he makes a purchase, and then the payment isn’t delayed. 

So back to that idea of protecting your money, he’s found that, but he also found something that has an emotional tie. The younger generations are looking for products that make them feel like their values are connected. Big banks don’t do that. 

So this new card allows him to donate any interest he makes on his purchases or any benefits he gets, he can donate to a charity of his choice. And he’s very altruistic, so I love the idea that it’s not him going to get airline points to get on a free ticket, but can instead support an animal shelter in need, for example. It’s very heartwarming.

That all ties back to the idea of creating just an overall better experience for customers. How do you think partnerships and ecosystems, specifically in fintech, are creating this type of added value and these better experiences? 

RP: From past experience, when I worked on a rewards platform, there was a disconnect. So consumers had to come to an app or an ecosystem, and there were behaviors they had to complete before they could then receive the rewards to shop at a third-party store. 

Having all those systems become about finding people where they are is huge. There’s an expectation from consumers to shop local, which means they want to go direct to brands. They don’t necessarily want to have to go to a third-party and do all these things in different places. That experience should already be where they are already coming.

“Businesses should meet their customers where they are, and I love to see that this idea is expanding in the world. But I also think there’s so much opportunity in that space for growth by asking brands to be authentic to their customers, and to make sure their customers are receiving the interactions that they want.“ 

For example, we have to recognize that there are people that want to speak on the phone to customer support, but there are also people who don’t, and we need to solve the problems they might have and get them the things they need to proceed without that added friction.

Exactly, it’s all about creating that digital, seamless experience. How do you think about the use of data in your world, and specifically the industry’s approach to data privacy and security?

RP: Again, it’s all about creating connections to people to get access to what they’re looking for. When I look at the work that’s ahead of me, where I am now with Switchfly, I think about the fact that there are content providers that aren’t necessarily the big players. They’re not the Travelocity’s – all of those sites, the places where travel content comes in, exist on a platform somewhere. And that data is passed through. 

I think that data in the fintech space is very often something that’s behind the screen. We’re not really asking for customers’ feedback on new experiences we’re providing them. So when we’re using data to provide experiences, we need to be honest and transparent, we need to check in frequently, and we need to not just continue to move the wheel away from the starting point. There needs to be a reset once and awhile where we just throw it all out and try again, and make sure customers haven’t changed or are still interested in the things they used to be interested in. 

I think profiles are a hot topic. I want every consumer and every user to be able to say, “Oh, I understand why I am seeing this ad and information,” or, “I don’t like these things, so now I can tune my own experience by having a way to get feedback.”

What do you believe are some of the top challenges you think the industry faces when it comes to customer acquisition and retention?

RP: When we talk about consumers, I do think that there are challenges. What I’m working on is new, something that hasn’t been explored in the past. And I can imagine that we can’t make something that’s relevant to everyone. This is a big part of the product space – how do you figure out who you want your target consumer to be? And on the flip side, how do you make sure your target consumer base is a large enough group to help you support your business, but also people who want to work with you long-term. There’s always that potential that you’re making assumptions.

I love the space of greenfield work in the product space, where we just get to go and find out what people say, but in three years if I’m still assuming that what was relevant today, as we start to design and define the product, is still relevant and that those consumers are the right ones to be targeting – that can be a big miss. Most companies kind of rest on their laurels a bit, continuing to target the same types of customers, but what if consumers have shifted their perspective?

"As businesses, we build technology and infrastructure based on what we know today – but we also have to be able to build things that can shift directions for certain types of consumers, and that can even shift around the consumer we’re looking to reach, without there having to be a rebuild of the product. We have to build products that are extensible, and have the ability to pivot when the world does." 

What are some other monetization/revenue priorities? How do you think about finding new, sustainable revenue streams?

RP: The biggest thing that I always think about is that if we’re relevant, and consumers are willing to pay, you’ve found the magic thing that can last. I did a lot of exploration last year during COVID-19, and I was trying to think about where I was as a person and how I could find something that could benefit me during an employment gap. My role had been eliminated, and there weren’t a lot of jobs on the market due to the pandemic, so I started to mentor people and spent a lot of time chatting with mentees around how I could help them. 

I realized that I would love to be able to just find a place where I could just say, “Hi, I’m Rachel, and this is my need” and people could just volunteer to step in and help. Then I recognized that this is actually something I could monetize. So I did a deep dive around the product-market fit, and recognized that LinkedIn has features to show up in searches and reach out to people, but there wasn’t anything in there for me as a consumer. 

“As the industry continues to grow and shift, we need to think of ourselves as the consumers when we’re making decisions. To be able to bring in new revenue, we have to have that empathy. It has to be empathy-first.“ 

Then when we find an area where there might be an opportunity for revenue, we need to go talk to the consumers in that space, even if they’re not our customers yet. I think a lot of companies make more assumptions, getting stuck in that “three years back” mindset thinking they know their customers and that things haven’t changed. They don’t query them. 

We also tend to think we’re experts. As soon as we build a product, and as soon as the team is working on it, we feel like we have our marching orders and can just go ahead. But we’re not getting constant and consistent and incremental feedback to make sure we’re going in the right direction. 

Beyond what you’ve already touched on, how do you think about enhancing or adding value to the user experience, as a product leader? 

RP: I’m very much consumer-focused, but I’m also really focused on engineering and how we make a great experience for the engineers so they’re not having to build giant systems that are hard to maintain or make changes to. 

The other part of it is that as we’re getting more mature in this fintech space, we’re starting to recognize again that you can’t build something that can’t shift. COVID-19 taught us so much about assumptions – that things were just going to be one way forever. I’ve been hearing on the news about some things falling apart in this new tech finance space, and it’s all because of assumptions. 

“We need to be more honest with ourselves – just because the world has reset itself and we’ve been on this tech rocket ship for a while, that doesn’t mean that’s going to last forever.“

The only way to be nimble in this space is to be able to say we can pivot, or “Here are 3 ways we can do things. This is the direction we’re taking because it’s what we’re hearing is best, but we have fallback plans.” 

“We have to have fallback plans. As businesses and as technology players, especially in the fintech space, we can’t make the assumption that one way is the only way and the best way.“ 

What haven’t I already asked you that I should have asked? 

RP: I want to go back to the idea of “implicit vs. explicit” when it comes to data. 

I just think it’s so critical for us to think about the fact that the more we explain to people what we’re asking for, how we’re going to use it, and how they can opt-out, the better. 

“There is this benefit to having data to drive benefits for consumers and for the company, but unless that door is open, the company is honest, and customers have the ability to opt-out and not participate (which could mean losing customers or business partners), the younger generations of consumers won’t be happy." 

Young consumers don’t want some 70-page privacy policy they have to read and agree to. For a long time, my son wouldn’t buy an Apple device because he wasn’t comfortable with how they were using his data. I think what Apple discovered was that they hit a plateau, and now they let consumers decide on their privacy preferences for every app they download. So they heard the consumers, and started to make a huge shift. 

“Until we get to a place as businesses where we allow consumers to interact with us only because they want to, and truly succeed at making them want to stay with us, we’re still missing out on a lot of our ability to make things better for all parties.”

Curious about Zendrive and how we help fintechs through our IQL ecosystem? Learn more here.

How the fintech space should take on today's challenges
Meara Hamidiani
Senior Content Marketing Manager
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