Ever notice how most things we use these days are either membership or subscription-based?
Whether it’s that great article in The Economist you read last night or the Spotify list you enjoyed on your way to work or that tasty HelloFresh dinner you’ve just unpacked, they’re all part of what is known as “The Subscription Economy”.
With so many membership and subscription programs, it’s so easy to lose track of what you have and what you’re paying for!
This is the story of how the Royal Bank of Canada (RBC), is helping people everywhere take control of the situation (while at the same time, attracting a whole new customer base).
Meet Butter – a digital hub designed to help you save money, earn rewards and manage your memberships and subscriptions – all in one place!
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Moving away from traditional banking.
Headquartered in Toronto, RBC provides personal and commercial banking services to about 16 million clients in the U.S., Canada, and 34 other countries. It’s currently the largest bank in Canada and the 6th largest in North America according to Statista.
Despite its size and obvious success, technology-led disruptions and the rise of smaller fintech players in the industry made it more important than ever to compete through innovation.
It was time to move away from traditional sales methods like mailing out credit card offers and using branch offices to expand market shares. Instead, they created a new unit that fundamentally changed the way they attracted new clients: RBC Ventures.
About RBC Ventures.
RBC Ventures is a subsidiary of the Royal Bank of Canada, built with the goal of attracting new clients through meaningful solutions. They think, act and operate like a startup while exploring new ideas that cater to unmet consumer needs.
In a nutshell, they build new ventures, buy startups and partner-up with organizations that can help them reach their goals. As described by Mike Dobbins, Chief Strategy and Corporate Development Officer at RBC:
“My goal today is to build wonderful products that lots of people find useful. And if we get that right, I believe we have the pathways to grow more core clients.”
In 2018, the bank announced that it was aiming to attract 5 million users in the space of 5 years through its various digital offerings. Their end goal is to convert 10% of those users into RBC banking clients.
Let’s take a closer look at another great RBC Ventures initiative: Butter!
Say hello to Butter.
The idea behind Butter came from founder Derek Szeto’s own challenges keeping track of memberships and subscriptions. Armed with a solid concept, the RBC Ventures team moved quickly to get it out to the market. In Szeto’s own words:
“Once we come up with a solution that we think users will love, RBC Ventures is focused on getting a minimum lovable product (MLP) out to the market fast and then iterating continuously to make the product better. It’s never once and done”.
For the “build” phase, the founder was joined by Product Owner Vinny Liu and Chief Technology Officer Stephen Evans, who helped take Butter from its initial version to the finished product that’s on the market today.
After dropping some of the initial components and making a few tradeoffs here and there the Butter team was ready to launch within a record 4 months! Amazing!
How does it work?
Forgotten memberships and subscriptions can go on charging you for months before getting back on your radar, and unfortunately, in most cases, that’s money you’ll never see again.
But never fear! With Butter, you can easily bring together all your memberships and subscriptions in one place, carefully tracking what you spend, canceling any unwanted ones and earning cash rewards while you’re at it!
Here’s how it works:
- Create your account.
- Plugin your preferred method of payment (i.e. bank accounts, credit cards, and debit cards)
- Butter organizes your subscription payments (based on past transactions) and lists them on your dashboard.
- You get 1% cashback on eligible consumer memberships and subscriptions.
And you’re done. It’s that easy.
Butter will even send you exclusive coupons and recommended services from its partner companies, based on your specific interests!
The value of investing in innovation.
By investing in Butter, RBC is preparing itself for the future in a few different ways:
- Attracting new clients with new services and technologies.
- Moving outside of and expanding on their traditional banking services.
- Learning more about the preferences, values, and demands of their target audiences.
- Building a more entrepreneurial culture with a diverse set of expertise.
- Leveraging the “subscription economy” to create their own steady set of customers.
The Butter team, on the other hand, gained its own set of benefits:
- Support in the form of financing and resources.
- Access to RBC’s expertise and customer data.
- Designated office spaces in Toronto’s financial district.
- The freedom to operate like a startup, but still have corporate backing.
- RBC’s name and reputation, which made it easier to forge the right partnerships and build customer trust.
What’s next for Butter and RBC Ventures?
Butter is still going strong today, giving users the peace of mind they need, by helping them easily and efficiently track their membership and subscription-related spending. This includes things like Netflix, Amazon Prime, Playstation Plus, The New York Times and even Costco.
As for RBC Ventures, they’re showing no signs of slowing down. In October 2019, they won 2 BAI Global Innovation Awards, one awarded to RBC Ventures itself for “Business Model Innovation” and the other to their Drive app for “Innovative Touchpoints & Connected Experiences”.
More recently in 2020, they bought “Dr. Bill”, a user-friendly mobile billing platform for doctors.
And don’t forget RBC Reach, the accelerator program featured on the RBC Ventures website.
With all these different ventures, we’re bound to hear more exciting news from RBC soon! This is one to watch folks!
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