Pretty much everything about Robinhood’s user experience is visually appealing, and that includes its logo and app icon.
The Robinhood logo features an upward arrow within a feather, in reference to the folkloric character the app is named after who wore a feather in his hat. The light green logo certainly provides those who encounter it with a welcoming and aspirational feeling. Robinhood’s logo makes for an interesting contrast with most other brokerages that give off more of a corporate, staid and less memorable appearance.
While Robinhood’s logo certainly suggests an enjoyable user experience, let’s take a closer look at the consequences and impacts that its broader design choices have for its users.
Robinhood’s Own Words on Design
Robinhood designer Alexandra Bond gave an interview to web site 99u and explained many of the design decisions that went into the app. It’s clear from her comments that Robinhood was attempting to take an entirely different path from “traditional” financial services companies that primarily relied on text to communicate with customers.
When you look at the traditional financial brokerage account, there’s a lot being communicated there that isn’t in writing. Whether it’s the landing page or the product itself, the design can feel very alienating to customers. I don’t know if it’s intentional or not, but it serves a purpose: it’s obtuse, difficult to parse, and, as a user, it can make you feel like trading is not for you or maybe those fees you’re paying are really worth it because this all feels really complicated. I think there’s a lot of muddying the water to make it seem deep.
At Robinhood, we’re conscious that design, beyond the words, communicates who a product is for. We’re focused on design that’s friendly, that’s inviting, that doesn’t intimidate you, that isn’t condescending.Interview with Robinhood designer Alexandra Bond, via 99u
And as for Robinhood’s now iconic light green color, feature in their logo and throughout their app? Here is Bond again:
“Traditionally in the stock market, green means up and red means down. That’s a really quick visual cue, but in the wrong application, it can feel intimidating and clinical. Rather than just your typical primary green, we wanted ours to be a little bit more vibrant. I think that it speaks to a younger generation.”
Design Straight from Silicon Valley
What might be most important in understanding both Robinhood’s design choices and overall business strategy is that it is startup from Silicon Valley. This means that it is relying on super fast growth and the acquisition of a large number of users to justify increasingly higher valuations for the company as it proceeds through finding rounds, eventually with the goal of a Wall Street IPO.
Robinhood’s own slogan, “democratizing finance for all,” provides an even clearer hint of their goal of bringing as many people into their product as possible. As a result, they had to make some important design choices upfront, and almost always favored simplicity over complexity as an aid to this goal.
As their designer, Alexandra Bond, makes clear in the same 99u interview:
“We make use of simple colors to remove as much information as possible, so that it’s clear to the user what’s happening. For example, we have day and night mode in the app that reflects when the markets are open and closed. Overall, we try to remove as much decoration as possible and use color as a way of communicating what’s happening in the moment.” (Our emphasis added)
As Robinhood users we can instantly relate to what she is saying. When opening the app and waiting for that split second to load, who hasn’t felt joy at the feeling of the screen lighting up green (to signify gains) or dismay when it loads red (to show losses, no matter how small)?
But what are the implications for removing as much information as possible from an investing app?
The Pros and Cons of Simplicity
Robinhood’s focus on simplicity has clear pros, but also some cons that you may not fully appreciate.
On the plus side, as Bond says, Robinhood makes it very easy to understand what is going on with your account and individual positions at a glance. The overall user interface is inviting, intuitive and clear which makes trading less intimidating to the many new users it’s trying to attract.
One standout area that Robinhood’s simplicity shines is in its interface for trading options.
For many of the most popular stocks and ETFs that have a high volume of options, Robinhood provides a guided feature called “Discover,” which walks users new to options trading through the process of buying a call or a put, instruments which let you bet on the future price of the underlying stock or ETF. Robinhood provides a walk-through process where users can decide if they think the stock they have selected is going up or down and over what time period.
Robinhood also provides some basic parameters that hint at the underlying, deeply complex odds calculations that form the basis of the options market. Options that require relatively large price moves in short periods of time are characterized as “high risk,” while smaller moves with longer time frames are noted with “some risk.” Users can make their calculations and buy an options contract in moments and then monitor it in their portfolio on a daily basis with the rest of their stocks, funds and cryptocurrencies.
Many of the aspects that make options trading appealing on Robinhood can also be viewed as negatives from a sound financial management perspective. While Robinhood hints at the risk involved, it’s possible novice users will be swayed more by the visual projection that highlights the potential of “Max Gain: Unlimited,” that Robinhood provides in its preview screen before the option is purchased. There is no underlying percentage displayed that would make it clear just how unlikely it is to achieve the high level of profits on offer.
Without some of this more foundational knowledge about options, we fear many new investors may get attracted to the gambling aspects of buying naked options without fully appreciating the risks or developing an edge that gives them a chance to be profitable.
Once your trade is on, if something goes wrong such as being assigned unexpectedly or incorrectly, be prepared to wait 1-3 days for an answer with no real option for phone support.
Generally speaking, this type of give and take is present throughout Robinhood’s customer experience. The app’s beautifully simple design comes with a hidden cost, just like their famous offer of free trades.
The app is light on research and technical capabilities, making it a poor choice for most active traders or those who prefer to run more complex strategies, whether with options or stocks. While it’s great that Robinhood is bringing in many new investors to the fold, it should also have a plan to support their growth over the long-term or it will risk many customers “graduating” to what they they perceive as more serious brokers, even if the later have unappealing logos.