Reaching the Base of the Pyramid in Mexico: ATMs Beat out Mobile
CGAP’s second Applied Product Innovation project was executed in Mexico in partnership with Bancomer, Mexico’s largest commercial bank, and IDEO.org, the non-profit arm of the design firm IDEO. Bancomer had already launched a product (Cuenta Express) for low-income people in Mexico and wanted to explore new approaches to product development in the hope that an innovative branchless banking product could help activate this large customer base. During the three-month engagement, IDEO.org put together an interdisciplinary team to bring a diverse knowledge base to work on the project.
The IDEO.org team, along with a CGAP team and Bancomer representatives, participated in two sets of field work. During the first, the team targeted a small sample of well-segmented consumers with in-depth two-hour interviews to gain a better understanding of lower-income Mexicans’ financial behavior. The team used a variety of tools and techniques to gather information in a logical and sequential way depending on how the conversations evolved. These visual tools not only helped consumers have full clarity on what exactly was being discussed, but also allowed them to take a step back and provide a broader perspective by detaching themselves from their personal experiences. Among the variety of tools and techniques employed, the team used abstract diagrams of “sacrificial concepts” to understand how people thought about the safety and accessibility of their money.
For instance, this sacrificial concept represents a drawing of four different ways people can save money, allowing the team to understand how much control and degree of difficulty for accessing their money people preferred: On the one hand, people told us that the brick option made cash secure but too difficult to access. On the other hand, putting cash inside an envelope did not seem secure enough and would be too easy to access. Interviewees instead selected the locked chest as it provided the right level of security and accessibility of cash.
Important insights among consumers began to emerge after a certain threshold of interviews, which IDEO.org translated into design principles.
Based on insights from the first round of interviews and the resulting design concepts, the design team created a number of high fidelity prototypes with accompanying branding materials and advertising brochures on products. These prototypes consisted of, for example, ATM mock-ups done with an iPad (see picture below). The prototypes were very useful for the design team in determining whether people could use the envisioned product and where consumers struggled. Unfortunately, the Bancomer ATMs did not look as sophisticated as the mocks-up by the design firm. While these mock-ups were inexpensive for the design firm to create, they could not be easily developed by the bank. Ultimately, this helped lead to the downfall of the product concepts. Despite this road block, this engagement showed mock-ups can allow for fast iterations of prototypes, which are effective when testing out concept ideas.
The final products developed were savings-based. One of them was a goal-based savings wallet and the second helped ensure the efficiency and formalization of existing Mexican informal savings groups. As the latter product envisioned these informal savings groups to become formalized, banks could view the financial history of the members of the savings group and thus potentially supplement total savings capital for the group as well as offer other incentives or prizes.
The project was not without a number of challenges. In fact, the team encountered many challenges after the design phase, particularly around marketing and regulation. One of the biggest challenges, however, arose during the actual design process, when Bancomer suddenly adjusted profit expectations for the product.
Through the Mexico project we learned once again a basic lesson: for a branchless banking product to be successful, the entire user experience must be high-quality and carefully based on design principles arising from customer insights. Getting the ecosystem right around a particular product is as important as the product itself.