Every brand seeks to build loyalty among its customers, and banks are no exception. In fact, banks wish to foster a great deal of loyalty. In addition to checking and savings accounts, today’s banks hope that consumers will open retirement accounts, and borrow money to purchase cars and homes from them.
Bank Loyalty In Today’s Marketplace
Most banks spend a great deal of time and money working on customer loyalty. Banks put almost as much energy into maintaining customer relationships as they do into acquiring new customers. But have banks done enough?
- Millennials are 2 times more likely this year than last year to close all accounts and switch banks (FICO)
- 66% of financial executives said acquiring new customers was their top strategic objective for their loyalty program. Just 56% said customer retention was their top objective (Forrester)
- 80% of bank executives understand they are at risk of customer attrition; just 40% are focused on improving the customer experience (ACI Worldwide)
- Less than 30% of consumers believe that offers from their banks are customized for their individual needs (NGDATA)
Based on the changes in consumer expectations, every bank is shifting its thinking about the loyalty program. Instead of giveaways or rewards for credit card usage, banks are beginning to see their relationships with customers in a holistic fashion.
Total relationship loyalty is the goal of most financial institutions. They want to be the one-stop-shop for all of a customers’ financial needs. Whether it is investing, personal banking, business banking, or lending, banks want to be the provider of choice for each client.
Banks have begun to track how their customers feel about them in the hopes of achieving total loyalty. By paying attention to the customer experience and satisfaction, banks seek to strengthen bonds with their account holders. Big banks are becoming very aware of the importance of enriching and improving the customer experience.
They track this by conducting surveys and by being as accessible as possible. In addition to toll-free numbers, providing online chat services makes it easy for customers to reach and interact with bank employees. No longer do customers have to call during business hours or visit a branch to get results.
Developing Bank Loyalty
The best way for any business to develop a loyal customer base is to deliver on brand promises. Successful banks understand this. Ethical behavior is one of the cornerstones of doing this. When a bank is hit with a scandal, such as the one Wells Fargo is facing, customer loyalty can be seriously damaged.
Another way banks maintain ties with customers is by showing appreciation with gifts. These can take several forms. Banks offer bonuses for opening new accounts when minimum deposit thresholds are reached. Physical gifts such as small appliances or stuffed animals may also be given out.
Loyalty rewards are, however, still significant in the world of banking. CitiBank’s Thank You program gives customers points simply for using their debit cards. This program is simple but offers several benefits. Customers can use their points with Citi or with partner companies.
In a highly competitive market, every financial institution looks to foster loyalty. As the industry becomes more sophisticated in handling big data, banks are changing the ways they reach out to customers.
Filed under: Brand Loyalty