Home' Superfunds : Superfunds November 2018 Contents Many superannuation funds have developed a new arsenal
of tools to help members plan for a high-quality retirement.
These tools can re-calibrate how and when a fund engages
with members, and include online transactions, personalised content
and the option for digital advice offerings to name a few. They can
help members measure spending levels and budgets and crucially
monitor budgets in real-time, taking the guesswork out of the
When these tools are tailored for each member’s personal super journey,
together with digital technology options that are actually fun to use, it’s
known as gamification. Gamification is not new and for some years, select
super funds have been rolling out gamification elements into their online
relationship with members. Spurred on by the digital transformation process
of taking their business online for members, online tools for many funds
are now part of the member journey. However, the struggle to engage
with members continues and remains the number one challenge funds face
THE GOLDEN AGE OF GAMIFICATION
The banking sector has done a solid job of engaging customers in online
gamification – with points awarded for transactions, downloading and using
a mobile app and watching financial education videos, plus round up options
for card payments via mobile apps to divert funds to a savings account. The
superannuation industry may now be entering a new age of gamification.
The integration of digital technology in our lives is a big reason why
gamification is becoming increasingly important. Digital technology opens up
information, making it readily available. In the case of superannuation and
wealth management, this enables a closer relationship with a member, but it
can also present more information than individuals know what to do with.
Humans tend to react the same way with any overload of information –
they ignore it. Or they can search for information that corresponds with their
point of view and inevitably make the wrong decision. This pre-conceived
confirmation bias is where gamification can come in to play, challenging
member’s opinion and guarding against them making wrong decisions.
GAMIFICATION’S DIGITAL NUDGE CAPABILITIES
A high-profile example of the benefits of gamification took place under
the Obama administration in the United States. Renowned behavioural
economist, Shlomo Benartzi, showed how making improvements to online
systems can positively impact financial well-being outcomes.
Benartzi and his research colleagues incorporated big data and refinements
to a saving app to re-shape behaviour. In one case, email intervention
on enrolment in a savings program for 800,000 military service members
provided ‘simple nudges’ to show how small contributions led to increased
savings. This email program cost the Department of Defense $5,000 and
proved to be 100 times more cost-effective than official policy intervention.
In another project, Benartzi and colleagues showed how the digital nudge
on an enrolment screen in an automatic saving app influenced thirty per cent
more users to save $5 a day, compared to the current seven per cent who,
ironically, were opting for $150 a month.
The latest research into retirement funds by Benartzi relies on Big Data
to measure the financial decision-making process and outcomes. There is
a strong correlation between online decision-making styles and projected
outcomes. In a nutshell, if a member doesn’t spend much time reflecting on
certain steps, the larger the possibility a shortfall in retirement savings will
occur. Smart software can identify and deliver the nudges those members
need to get them back on track.
GAMIFYING AUSTRALIAN’S SUPERANNUATION
Gamifying Australia’s superannuation industry is a fresh approach to address
the thorny issue of engagement. Despite undertaking considerable steps
forward in digital transformation, there are still fund members who have
never logged in to their account, never updated their details and who never
contact their fund. This is evidence that building a transactional website may
deliver cost savings for fund administration but not deliver any increase in
However, gamification may help remedy this with fun and cost-effective
ways to personalise information and simplify and streamline the tasks at
Superfunds November 2018
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