Social+ companies are upping the stakes for everyone by giving consumers multiple benefits at once: products that serve a purpose but also meet our need for belonging to a community.
But what exactly is a social+ company? One for which social engagement is an inextricable component of the product. That is to say: If you removed the social element, the product would cease to make sense. You can find plenty of examples in gaming (Fortnite), fitness (Strava, Peloton), commerce (Pinduoduo), audio (Clubhouse) and more. As noted in Andreessen Horowitz’s recent series Social Strikes Back, “The best version of every consumer product is the one that’s intrinsically social.”
Social+ products are seeing mass adoption because they marry community with functionality.
The benefits of a social+ company
Social+ products are seeing mass adoption because they marry community with functionality. Users form meaningful connections — and engage in value-adding conversations — within the context of the goal they’re trying to achieve. Whether it’s shopping for a deal or growing their assets, social+ products help users gain new knowledge, find motivation, garner status, form friendships and generally feel like they’re part of something.
Companies that base their business model on social+ products enjoy a variety of benefits:
Growth
When the social aspect of a product is integral to its function, users will often drive growth on their own steam, inviting their friends and family to join the community.
Members of highly engaged communities are inspired and fired up by their interactions with other members, and when they’re fired up about something, they talk about it. Participating in these communities makes users feel like they’re part of something, which can have a powerful effect on your growth.
Retention
Relationships matter. The relationship your users have with your brand is ultimately what will determine whether they stick with you or leave you for a competitor offering the same service — particularly at a more attractive price. If you provide your customers with access to a community they relate to and resources that make their lives easier, they’re more likely to be loyal.
The beauty of social+ is that embedding social interaction within your product or app allows you to own that conversation and build a community around your brand. In the absence of built-in communities, these users are forced to turn to places like Reddit or WhatsApp to discuss, among other things, the relative advantages of competitors’ apps.
Harnessing the creativity of your users
User-generated content (UGC) is the lifeblood of any social+ product, driving user engagement and fostering connections among users. UGC means the company can harness the creativity and popularity of its users and doesn’t have to expend as many resources creating content users find valuable. Plus there’s the added bonus that authentic UGC — whether it’s a screenshot or a meme — lends the product far greater credibility than any marketing initiatives you could launch.
Insights-driven personalization
Building social into your fintech product gives you ownership of your user data, which makes it easier to get user input, test new features and understand which features work and which don’t. Once you have an established and active community built around your product, it becomes a captive audience that can be an invaluable source of customer insight that can drive personalized customer experiences.
Barriers to entry
A large and growing community where the power of the community is built into the value of the app creates network effects that your competitors can’t replicate just by adding features. Features are easy to copy — a community is durable.
Even fintech is going social
Because of these benefits, even highly regulated and change-resistant industries stand to see a wave of social+ innovation. Social+ disruption in finance exemplifies this momentum. Take WallStreetBets’ recent rise to fame as an example. Once considered taboo, sharing information about money has suddenly become commonplace.
From Twitter users complaining about their student debt to Instagram users and bloggers frankly discussing their income with their followers, to employees at companies like Microsoft sharing salary information among themselves for greater negotiating power, to anonymous professional communities like Blind facilitating frank discussions on just about any topic, to day traders bragging about their investment bets and bitcoin gains on Reddit — openly discussing money online is rapidly becoming the norm.
P2P payments app Venmo was something of a forerunner when it introduced notes and emojis to payments and requests, turning a frequently awkward experience — asking friends to pay you back — into a fun and social one.
More recently, next-gen trading apps like Robinhood have disrupted the market by giving aspiring investors the vehicle they need to invest in the stock market. By not charging broker fees, they’ve made investing more democratic and accessible to the average person. But what most of the existing apps have failed to provide is the map to help new investors take the right turns, and a community of companions to make the journey less frightening.
If the popularity of WallStreetBets has proven anything, it’s that a product’s functionality — the ability to transact — is not enough. Users want access to information on demand from real people. They want reassurance from other investors when the price dips right after they bought in, and the camaraderie (and memes) that stems from shared experiences. And if this community isn’t integral to the product, they’ll go elsewhere for it.
Companies like Public and Commonstock recognize this, creating social+ fintech products that offer just that, allowing users to follow one another, create posts about their investments, engage in community forums and chat one-on-one.
South African fintech StokFella has created a truly social-first lending product. StokFella is an online ROSCA, which means community members each deposit a set monthly amount into a joint account, with a rotating member withdrawing the full sum each month.
Creating a truly social+ finance product
When building a social+ product, the key thing to remember is that it’s “social+commerce” or “social+finance” (or whatever the case may be), not “finance+social.”
Simply slapping a social gimmick onto your product as a marketing ploy won’t do the trick. Social needs to be wired into its DNA. To achieve this, it’s vital that your platform provides users with the tools for authentic peer-to-peer social engagement — features like in-app publishing, following capabilities, activity feeds, forums, one-on-one and group chat, voice calling, video calling, leaderboards and network-driven rewards alongside transactional functionality.
This may sound like it requires a time-consuming overhaul of your app or existing product, but it doesn’t have to be. Today’s API ecosystem makes it surprisingly fast and easy to implement new social features, although it’s worth bearing in mind that building a social+ product comes with challenges like community moderation when building your stack.
Social+ products are rapidly gaining traction, with companies like Pinduoduo, Strava and Public leading the way. This shift toward social+ is not going anywhere, and the fintech vertical is no exception. The good news is the social+finance trend is still in its infancy, which means there are opportunities to gain a first-mover advantage by acting now.