Behind the scenes with Ally’s innovation team: How we make your money perform smarter with new smart savings tools
Feb 3, 2020
7 min read
What would it look like if your savings account did more for you than just house your money? Since we launched Ally Bank back in 2009, our Online Savings Account has been incredibly popular — and, as the first in our full suite of digital services, it’s particularly special to us.
That’s why we decided to make the online savings account perform even smarter by creating innovative ways to help you save. Saving money can be stressful and emotional, and no one really teaches you how to do it right. Our reinvented Online Savings Account includes new, easy-to-use tools to help you push your savings further.
We spoke to Sonia Fraher, a director in deposits product management, and Emily Shallal, a senior director in strategy and innovation, to learn more about the innovation and inspiration behind these new savings account capabilities. They revealed some details about the tools, like where they came from and what we can expect in the future.
In a nutshell, describe the upgrades to the Online Savings Account.
Sonia: Let’s start with how we’re helping you organize your money — we’ve added the ability to divvy up your savings into sub-categories, or “buckets,” like emergency savings or summer vacation. These buckets help you visualize what you’re saving for, which in turn can motivate you to reach your goals — we’ll touch on that more in a minute.
We’ve also added ways to boost your ability to save. First, there’s recurring transfers — with that, you can move a specific amount of money into your savings account on a regular schedule. And then, there’s Surprise Savings, which analyzes your spending (through your primary checking account) and transfers any “safe to save” money to your savings account.
Let’s go back a bit further — how did this idea first come about?
Sonia: It really started back when we first launched Ally Bank and the brand — we wanted to truly be a financial ally to our customers. So, with our branchless bank and our first offering — an online savings account with a competitive interest rate and no outrageous fees — we focused our efforts on streamlining our customers' banking experience. We offered live, 24/7 customer service and none of the confusing jargon that’s so common in banking.
Customers flocked to us from traditional banks — especially in the past few years, as interest rates have been on the rise. We’re very proud of our tradition of being a “disruptor” in the industry, and we also recognize that interest rates are cyclical: They rise and they fall. So, we challenged ourselves to think about what should be next for our customers beyond just a great rate.
Emily: While we do believe interest rate is really, really important, (that’s why we’ve always had a consistently competitive rate), the majority of Americans don’t have enough in savings for interest rate to really be that relevant to their overall savings plan. And even if they do, we can still be doing more to help optimize their money.
So, like Sonia said, we asked ourselves: How can we go beyond interest rate to add value to our savings account?
The upgraded Online Savings Account is designed to help make it easier for customers to save. How did you figure out what customers needed?
Emily: We did a lot of research, both in-house and out in the world — literally walking the streets and talking to people. In the end, we spoke to thousands of people, and one of the things we noticed is they managed their money manually, whether that’s by stashing their savings in envelopes or having a calendar on their desks to keep track of when they needed to think about certain goals.
Once we saw the pattern, we realized that organization was a huge barrier toward saving. People couldn’t organize their financial lives in a seamless way — there was no easy way for them to keep track of everything. A lot of people were just doing mental math. They had one savings account and were keeping track of separate goals in their heads or in spreadsheets. And it was causing them to feel stressed and overwhelmed.
Sonia: One of the points that we honed in on was the way some traditional banks give tips on all these little things you can do to save money, like “Stop buying your coffee every morning.” But that’s not really useful — it’s telling people what they’re doing wrong, instead of helping them get on a path toward saving in a meaningful way. But if we could take some of that weight off the customer’s shoulders, then we are providing a strategy that is much more valuable.
In our early testing, we’ve seen people really seize the opportunity to make their buckets their own — naming those buckets things like “Dream car,” “Holiday season,” or “Tattoo.” We’ve even seen smiley faces! Customers are creating this direct emotional connection to their savings goals, and we love seeing that.
Emily: Yes, our number one goal was to help people organize. It seems so rudimentary, but a lot of people aren’t doing it, and they absolutely need help with it. So, that’s how the bucketing feature came to be — and, like Sonia said, we’ve already seen that take off, especially with personalizing the bucket names for different goals.
Why should Ally Bank customers get excited about these changes?
Emily: A lot of research shows if you can create an emotional attachment to what you’re saving for, you’re more likely to stick to your plan. For example, if you log in and the first thing you see is your total savings balance — that number doesn’t really mean anything, as a whole. But if you’ve broken that number up into buckets, and it’s actually tracking toward your child’s college education or an engagement ring for your significant other — well, you’re a lot more likely to stick to that plan and not abandon it, because it’s reinforcing why you needed to save in the first place. Creating that context is really important.
Sonia: What we’ve come up with is a set of innovative ways to help our customers make saving a seamless part of their lives. At the highest level, we’re going to help analyze, organize, and optimize your savings — regardless of what’s going on in the interest rate environment.
All of this adds up to offering a different kind of savings strategy that goes further to help our customers accomplish their financial goals and live their best lives.
What kind of innovations went into building the new tech?
Sonia: This has really been a labor of love for our entire team. If you’ve ever been part of a complex project, you know that even the things that look simple and straightforward require an incredible amount of planning, coordination, and attention to detail. There’s a lot going on in the background that the customer doesn’t see. It’s remarkably difficult to make something complicated look and feel like it’s quite simple!
For example, one of the revolutionary things about Surprise Savings is that you can link any checking account, whether it’s an Ally Bank checking account or somewhere else. That’s not usually the case with this type of tool — usually, you have to link a checking account of the same bank. But we’re your ally — we’re not trying to force you to move your checking account. We want our tools to be accessible.
And we’re still working on new innovations and technologies! Later in 2020, we’ll roll out another savings booster that will round up your purchases to the nearest dollar and automatically transfer that money into savings.
How can these savings buckets and boosters change how people save money?
Emily: I do believe that our upgraded Online Savings Account is a real differentiator for people — because it will change the conversation about savings. Instead of savings being all about the interest rate, it’ll be about organizing your money around what you need to save for and getting to those goals as fast as possible. Interest alone is not going to do that for the majority of Americans — it’s an important piece, of course, but it’s not the entire factor.
If we can just get people to start thinking about their money differently, in a way that will help and motivate them to get there faster, I do think that’s a game changer for the savings world, because no one else is really doing that.
Sonia Fraher is a director on the Deposits Product Management team at Ally. She is relentlessly focused on bettering the customer experience, and in 2019, she helped lead the effort to bring the Ally Bank Online Savings Account’s Buckets and Boosters to life.
Emily Shallal is senior director on the Strategy and Innovation team at Ally. She is constantly seeking out ways to improve our customer’s financial savvy by understanding consumer trends and habits.