9 Tips to Boost Customer Loyalty in Online Financial Services

Jack Maden
Written by Jack Maden
September 15, 2020

The digital financial services industry is tightly competitive today. Risk-averse consumers worry about the unpredictable economic climate. Meanwhile, untraditional competitors appear as startups, challenging long-time industry-leading firms.

It’s no surprise that 75% of the largest global banks have started transforming their customer experience.

However, building customer loyalty in online financial services is no simple feat.

Only 12% of customers report using a single provider for all their financial service needs. In fact, the average person maintains a relationship with up to five different companies.

This implies financial institutions either aren’t offering the right services – or they’re not supplying the best experience for those services.


How to Improve Customer Loyalty in Online Financial Services

Improving the quality of your digital experience is the secret to building customer loyalty in financial services.

This is far easier said than done. You’ll have to study how customers interact with your website and app, what daily problems they face, and how you can use this information to improve. Here are 9 tips to help you succeed.

1. Create a Frictionless Omnichannel Experience

Customers need access to their financial information wherever, whenever. It’s critical for financial institutions to offer an omnichannel experience across all devices.

9 out of 10 consumers say they want a seamless experience across all channels. However, less than a third say brands deliver.

Friction in a shopping app or website is irritating. With financial services, however, it could be enough to jump ship instantly and permanently. Think of all the critical situations your customers might need your app or mobile site to work:

  • Transferring money while in line at the grocery store.
  • Checking their balance as they walk into a store.
  • At a gas station 600 miles from home when their card is flagged for suspicious activity.
  • As market prices fluctuate and they need to move investments ASAP.

No one will ever forget the time their card was declined while traveling and they couldn’t get into their account to fix it because the app wasn’t loading – and they’ll tell everyone about it.

Real-time data from heatmaps and session replays can help you identify potential bottlenecks before they turn into lost customers. However, most brands analyze their experience retroactively.

Fidelity Investment used Decibel to get the full picture of their digital experience issues across different devices and browsers. They found the “why” behind their poor customer feedback and corrected it to create a frictionless experience.

2. Improve Your Content Marketing to Increase Customer Loyalty

Today’s financial customers are prioritizing risk avoidance over product features. In an uncertain economic climate, people need to know their status is secure.

As of May, 60% of Americans were either severely or moderately concerned about their financial outlook. They need your help.

JD Power found that 78% of banking customers want guidance to manage their finances. Meanwhile, 89% say they’ve benefitted from advice from their banking institution.

It’s important for financial service companies to invest in content marketing.

Study your audience. What problems do they face? How can you help?

Robinhood has an excellent content marketing strategy. Their FAQ section explains everything a newbie could possibly need to know about investing.

Robinhood’s content makes a complex subject simple to understand with everyday language. It’s genuinely helpful and easy to find what you need.

3. Offer Digital Tools via Your App or Website

Beyond blogs and content, you could offer a whole suite of tools to help customers take charge of their finances.

A whopping 91% of customers who received useful advice say they trust their financial institution. Meanwhile, 89% say they’ll “definitely” use the same institution for another product.

You can offer personalized advice instantly via app and website tools. Retirement planning, budgeting, general saving – it’s easy to take data you’re already collecting and transform it into useful tools.

Huntington offers a wide range of personalized and customizable tools.

Notice the personalized automation recommendation to save $430 per month based on bills, income, and spending habits:

Spend Analysis helps customers see where their money goes:

4. Prioritize the Mobile Experience to Increase Customer Loyalty

A fully optimized mobile experience is mandatory for customer loyalty in financial services.

As of October 2018, over 75% of Americans used a mobile device the last time they checked their account balance – overtaking desktops/laptops at 53%. 43% of people across all demographics use mobile banking.

Finances are too important to put off until you have access to a computer. Consumers need financial information instantly.

A dedicated app offers both security and accessibility. However, keep in mind many customers may not want to install an app. It’s critical to keep your mobile website streamlined too.

You should also note that customers will often need to access their account in places where cell service isn’t perfect – such as inside stores. A heavy app or website with a slow load time can become inaccessible with only one bar of signal strength.

5. Make Yourself Available Everywhere to Increase Customer Loyalty

For every service a customer would rather complete online, there’s another they’d rather speak with a human to finish.

Research shows 82% of people have bailed on a company due to a poor customer experience. No customer experience is more important than financial service.

Make it easy for customers to talk to you wherever they are. Ideally, a mixture of methods can meet customers however they prefer to communicate:

  • Chatbots to answer basic FAQs
  • Livechats for personalized service
  • 24/7 phone lines with minimal automated prompts
  • Social media messengers
  • Easy access to a human via your app

Ideally, conversations on one platform should seamlessly shift to another. Repeating yourself to another bot or human is extremely frustrating.

Robinhood takes it a step further by reaching out to customers via their chatbot. Customers can choose premade responses and the conversational bot will respond:

6. Consider the Unique Needs of Individual Audience Segments

Finances are extremely personal. Every individual or family has a unique income, budget, and long-term plans.

It’s important to understand your distinct audience segments so you can personalize your digital experience for everyone.

Back in 2014, JD Power noted that midsize financial institutions fell short at meeting the specific needs of millennials, low-income individuals, and minority groups.

Many institutions have improved their offerings, but plenty haven’t either.

Huntington, for example, now allows customers to choose their own overdraft protocol. Customers can pick between:

  • Declining their card if there’s no money available
  • Pulling funds from a linked account
  • Incurring an overdraft fee after a 24-hour grace period

Over the summer, Huntington also announced it would invest $20 billion into affordable housing, small business access to capital, and investment in communities of color – specifically in low-income areas.

How you improve your customer experience depends entirely on your audience and their distinct needs.

7. Offer a Useful Rewards Program to Increase Customer Loyalty

Loyalty programs are excellent tools for increasing engagement and retention. However, the rewards must be attainable, useful, and understandable to deliver a result.

Technology offers a wide range of options for expanding your loyalty programs:

  • Allowing groups to pool spending and share points
  • Signup and referral programs
  • Digital reward catalogs with instant redemption
  • Partnerships with retail stores for discounts and points

Capital One, for example, flipped the traditional airline miles strategy on its head. With Purchase Eraser, Capital One customers can use their accumulated points to offset or erase an earlier purchase.

8. Expand Your Services to Increase Customer Loyalty

Startups like Coinbase, Robinhood, and Starling have disrupted the financial service sector and show no sign of slowing down.

Traditional institutions are scrambling to keep up now. These startups are so successful because they understand what untapped markets want and how to use technology to deliver it.

In the past, the stock market was totally unavailable to huge segments of the population – specifically young and working-class people. Robinhood changed that. Now, you can even purchase fractional shares through the app.

Charles Schwab has adapted new offerings to keep up. Schwab Slices let customers invest as little as five dollars.

Over the past few years, we’ve also seen traditional financial institutions offer crypto services. They know that a satisfied customer is more likely to add additional services to their account.

The key is to consider what features your audience might need and where they’re getting them.

9. Promote Privacy to Increase Customer Loyalty

Privacy isn’t anything to take lightly. Customers need to know their financial data and access is completely secure. However, they also need to know how to access their account in the event of a lockout or device change.

Robinhood’s app detects if the customer’s phone has a fingerprint sensor and requires it to open the app – regardless of the phone’s settings.

Strive for transparency.

Let customers know what data you collect, how you store it, and what you use it for. Make it easy for customers to find this information on your site before they even think to ask.

Implementing a few extra security features and boldly highlighting them can do wonders for encouraging customer loyalty and satisfaction.

Takeaways

A frictionless experience is paramount for building and keeping customer loyalty in financial services. Customers demand instant access to finances, reporting, tips, and help. A few strategies can improve your retention rate and encourage customers to stick with your brand for all services:

  • Invest in new features to improve the experience.
  • Look for bottlenecks across your website and app to reduce friction.
  • Make your mobile website and app seamless to use no matter the need.
  • Provide tips and assistance to help customers manage money.

For a go-to reference for optimizing your online customer experiences like an expert, download The Ultimate Guide to Optimizing Digital Experiences for Enterprise.

Topics: Customer Loyalty, Finance, FinTech, User experience
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