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Dear readers,
It looks like the bank can not hurt … it's finally done.
Despite the ups and downs of the market, JPMorgan's business has remained remarkably consistent. Last year, it took over more market share than other banks and its share price was also largely competitive.
But as JPMorgan proved last week, it's not perfect. The bank announced Thursday that it was dismantling Finn, its online bank destined for millennia, after a year. Instead, JPM has decided to attract young savers through Chase, its leading consumer brand. Existing Finn customers will be transferred to Chase accounts.
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It's a stunning reversal for a bank that believed it better understand millennia than anyone else. In 2016, JPMorgan broke through the credit card code by launching the Chase Sapphire Reserve, which has become an instant phenomenon and helped spark an unprecedented battle over rewards between credit card companies.
At the launch of Finn, JPMorgan said it designed the product "working closely with Generation Y for more than a year" to understand their unique monetary problems and the factors that affect their spending.
"In terms of money, the millennials told us that she did not want to feel they were being judged," said Bill Wallace, CEO of Digital at Chase 's. time. "So we designed Finn to put them in charge, no matter where and how they spend."
But solving the digital bank for the younger generation proved more difficult and Finn's race was short-lived.
We also spoke to several Wall Street experts who said they were not surprised by Finn's downfall and all expressed uncertainty about the decision to create a separate brand in the first place.
"Who is Finn? Nobody knows who it is," said Business Insider Alyson Clarke, Senior Analyst at Forrester. "It takes time to build that brand recognition and emotional connection."
Finn also did not offer some of the popular benefits that are commonly found on other startup banking applications. The current account showed no interest and the savings account rate was poor compared to its competitors. Finn only offered 0.04% to customers saving over $ 25,000, while many digital competitors, including Marcus of Goldman Sachs, offer over 2%, or 50 times more generous.
The fall of Finn offers a telling tale to the big banks who may think they can captivate the hearts and minds of young savers simply because they have a stature. Brand differentiation is important, and if Wall Street is not able to create something materially better for the Millennials than their existing main product, users will likely not follow.
You can see the rest of our JPMorgan coverage here.
Have a good week-end!
Olivia
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