Eight Ways Banks Need to Adapt for Customer Retention
The financial services industry is undergoing massive change and financial brands must ensure they are taking the right actions to attract and retain customers in the most cost effective ways.
We see eight ways banks need to change their behaviors toward customers in order to grow their brands.
1. Find your brand purpose
Have a clear, overarching, and differentiated brand purpose that is relentlessly focused on simplifying financial transactions and improving the lives of customers. How will your brand be more responsive than mammoth established banks? How will it adapt to how customers want to bank today and in the future?
2. Upgrade your branch design
The dated transactional bank environment, as seen in many branches, ignores the fact that most customers prefer to self manage day-to-day transactions, yet still desire a physical location to get advice on wealth management and to negotiate loans.
Ensure your branches reflect your brand purpose by being a pleasant place to visit and linger. Free customer WiFi and cafes are good starting points, but if you want to attract a growing cohort of startup businesses, provide temporary office space and meeting rooms. Consider providing workshops to local small businesses on how to do everything from tax planning and payroll to how to promote their businesses with social media.
Your branch can become a local business resource centre servicing both individual customers and businesses by acting as a “Financial Geek Squad” and serving as a comfortable, contemporary and welcoming information hub.
Brands with physical locations such as the Apple Store and Best Buy have demonstrated customers’ willingness to pay for insightful guidance, which suggests that an appointment with an “Investment Councillor” (booked online) might be attractive to your customers.
In any case, every aspect of the branch visit needs to be a physical manifestation of your brand.
3. Invest in mobile technology
Invest in and brand new mobile technologies to facilitate savings, investments, seamless bill payments, and loyalty program points collection. Ensure that customers are updated on the status of their financial lives.
4. Use social media as customer service
Embrace social media to demonstrate responsiveness to customer concerns. Welcome criticism and respond quickly and appropriately to make every customer a brand ambassador. Demonstrate how you enlist customer input to improve service offerings, call attention to special service providers, or let customers rate the overall experience.
5. Understand customer needs in real time
Continuously adapt to your customers needs – each of your customers and all of their needs. Whether you’re using concierge greeters to direct customers to appropriate advisors, easy access ATMs, seamless fund transfers, or email payments, the key is to be aware of every interaction. Beyond identifying irritating service delivery flaws, identify each customer interaction with the brand and bundle service offerings catered to their individual needs.
Create a consumer app that can show spending patterns and automatically reward sound financial practice, streaming savings into an investment fund or personal savings account. Congratulatory reminders of money saved helps promote more saving and makes customers feel good about accomplishing results.
6. Identify personalized opportunities
Use big data to identify every customer, their life events, and buying and spending habits, then mine the data to provide them with personalized service offerings. Entice them with offers that are relevant to their pain points.
Also, if customers have children, create savings programs built specifically to educate and help create customers of tomorrow.
7. Innovate new services
Expand your services to include specialized credit cards based on individual needs, such as wealth management; retirement planning; estate planning; personal, health and business insurance; tax planning; and expanded financial advice. There are particular opportunities to focus on specific demographics like women, ethnic or rural populations. Any element of consumers lives which involves money should make your brand be top of mind wherever they live.
8. Provide and promote value
Promote how your services save them money whether it’s reduced fees, online banking, photo checking, or e-transfers. Pay attention to competitors and demonstrate how you save customers time and money. Show them you appreciate the privilege of managing their money.
Customers are no longer content with traditional models of banking that favor decades long methodologies that cater to legacy processes. Improved technology, increased competition, and mobile-enabled consumers with the desire for greater management of their own financial affairs, makes it more important than ever to understand customer concerns and to provide easy solutions.
Banks must recognize new challenges to old ways of doing business and become disruptors of established models.