Financial Services


Why Customer Messaging Matters for Financial Services—and How to Get It Right

Erin Bankaitis By Erin Bankaitis Jul 21, 2020

The financial services landscape is looking a bit...murky these days. Banking products and services—once the exclusive province of traditional banks—are slowly but surely creeping into new verticals, driving a dramatic recalibration of what best-in-class banking experiences look like for the modern consumer. But while banks and financial technology (FinTech) companies are increasingly competing with each other, they’re also beginning to find themselves competing with Amazon, Apple, and other tech giants, making it essential to find ways to use messaging to drive stronger, more sustainable relationships with their customers.

Why Messaging Matters: Today’s Financial Services Dynamics are Shifting

People rob banks because, well...that’s where the money is. And savvy brands across the retail and technology sectors know that robbing a bank (metaphorically, of course) requires a differentiated, disruptive approach to overcome the barriers and capture the riches that the financial services sector is known for.

Leading global brands like Amazon, Apple, and Alibaba have taught us that consumers don’t just buy products and services; they also buy the brilliant, exceptional user experiences those products and services are wrapped up in. This is a big shift, one that’s left many traditional banks feeling vulnerable to challengers with a track record of excellence when it comes to customer experience. FinTech brands, known for their exceptional digital experiences, putting them a step ahead of traditional financial services companies. But these brands can’t afford to get cocky. If they’re not mindful of today’s looming threats to their ability to scale and monetize, they may find themselves losing out not just to banks, but to non-financial brands built on strong customer experiences and capable of operating at a massive scale. (Think Apple’s wildly successful credit card debut, with over $10 billion dollars of extended credit within two months of launch, or how Starbucks holds over $1 billion in customer mobile payments in their app.)

In the financial sector, the battle for customer experience is already well underway,and right now, it’s anyone’s for the taking. Today’s consumers crave banking interactions that are authentic, relevant, and meaningful—and brands can’t make that happen by tacking on incremental features and functionalities. Financial brands need to lean on their marketing teams to develop and execute effective communication strategies in order to stay relevant, deepen relationships, and realize the maximum value from their investments.

In our work with financial brands big and small, we’ve developed a strong perspective on what it takes to build a powerful, growth-oriented customer messaging strategy and the major impact the right messaging approach can have on your bottom line. So let’s explore how customer messaging can impact customer experience—and how to get it right.

1. Know Your Customer—For Real, In Real Time

“Know Your Customer,” also known as “KYC,” is far from a foreign term in the financial services space. But how well do financial services brands really know their customers? Financial brands tend to greatly benefit from the rich data they capture from high- and low-frequency customer transactions (for instance,a given customer might make payments daily, contribute to a retirement account bi-weekly, and file taxes annually). But that doesn’t necessarily mean they’re able to act on that data in ways that are timely, relevant, and personalized to each individual. After all, KYC isn’t a time-capsule exercise; your customers have preferences and needs that are constantly changing.

When done right, banks and other financial brands can learn the needs of each subset of their audience, target the appropriate segments for each campaign, and dynamically shift messages based on how a given customer responded to a particular message. For example, a bank could trigger a promotional in-app message targeted at users with a specific card who have spent X amount of time browsing new cards; the message could then be personalized based on what card the user spent the most time viewing. Really knowing your customers also requires brands to take into account what messages resonate (and don’t) with each recipient. If I choose to ignore a credit card upsell email, a bank should be able to take this information and determine the next best interaction (hint: It’s not sending the same email one week later.)

Banks need the right data infrastructure and a thoughtful data collection strategy in place in order to listen to customers’ preferences, understand and anticipate their needs, and act accordingly. Financial brands know that they have to step up to this challenge—but too often they end up settling for the insufficient status quo. That could mean ignoring departmental or data silos, continuing to rely on legacy marketing technologies that can’t support real-time streaming data, or continuing to build marketing strategies around hunches instead of true data insights.

Investing in truly knowing your customer in a holistic, up-to-date way can support an intuitive messaging strategy and result in significant uplift in each customer’s likelihood to convert. Communicating with customers on an individual isn’t something you can make happen overnight—but taking the right steps right now is essential if you want to stay relevant in a sea of fierce competition.

2. Personalized, Cross-Channel Messaging Experiences Are Essential

Even if a financial brand gets KYC right, they’re still going to need an effective customer engagement strategy that’s built around each consumer’s needs, wants, and preferences. Banks should look outside the walls of the financial services vertical to find inspiration when engaging with their customers, especially industries that have seen significant disruption from customer experience-focused challengers. These brands are usually one step ahead when it comes to personalized digital engagement strategies, and the most successful ones use a cross-channel approach to deliver the “next best interaction,” rather than the “next best offer.”

What does that look like? In the mobile gaming space, US gaming brand Dots uses highly personalized and segmented in-app messages to customize offers based on levels played and previous purchases, resulting in a 25% increase in user lifetime value (LTV) and a 33% in revenue. Similarly, South African streaming service Showmax used smart segmentation to deliver cross-channel campaigns via email, push notifications, and in-app messages that increased the company’s subscribers by 204%, boosted their retention rate by 71%, and increased their win-back rate by 12%.

These brands have very different business models and customers, but the impact of targeted, personalized cross-channel campaigns is significant across verticals. For financial services brands, it may turn out that a head of household looking into an auto-loan responds best to an email emphasizing safety, while a younger buyer is more likely to engage with a push notification that highlights cars that feature better sound systems. But if you send a generic, one-size-fits-all campaign in a single channel, you’re going to alienate at least one of these consumers—maybe both!

A coordinated cross-channel strategy is beyond the reach of most of today’s financial services brands, who tend to use legacy marketing clouds incapable of supporting true personalized engagement across multiple channels. They also often over rely on email marketing campaigns to improve conversion rates. But while conversions are important, a myopic focus on conversions is a product of an earlier era—it assumes that the point of communication is to push whatever the deal or product of the moment is on recipients, instead of assessing what they actually need or want and finding ways to nudge them to use your brand to fulfil that need.

Instead, banks and other financial brands should message their customers based on what their behaviors and preferences suggest they actually care about—from financial tools and tips to education about how to holistically manage their finances. Rather than compulsively offering the “next best product” to consumers who may not be interested, these brands should incorporate messages that are linked to life events, customers’ current location, and other contextual data points. When done correctly, this type of messaging strategy is the best way to earn customer trust and loyalty.

3. Prioritize Message Testing to Change Perceptions and Drive Value

The uncomfortable truth about personal finance is that it’s an activity that many consumers dread—after all, who really enjoys paying bills, filing taxes, or having to go through a laborious process just to open a simple account. That means that financial brands see some of the highest onboarding abandonment rates of any vertical. To successfully drive users down the funnel from acquisition to conversion, banks and other financial brands need to continuously test their messages—different copy, different creative, different message timing—to hold onto as many of these new users as possible.

Let’s start with acquisition. The best onboarding strategies look beyond “time to open an account” and put an equal—or greater—importance on lowering the perceived effort through value-driven messaging. The key to driving value? Incorporate messages that make users feel a sense of achievement and ownership. For example, many FinTech brands allow users to add a card to Apple Pay as soon as an account has been approved, a sort of instant access that no traditional banks currently make possible. With appealing messaging determined by A/B or multivariate testing (e.g. “Use your card today while you wait for it to hit your mailbox”), this can generate feelings of accomplishment that are as instant as the access to the account, even though it may still take a couple more days for that customer to have the physical card on hand. In general, banks and financial services firms should aim to make onboarding as effortless as possible by embracing a phased onboarding approach. Instead of gathering all of a customer’s data up front in an interminable series of form fills, only ask for what is absolutely required, then save the nice-to-have data points for the moments when they become relevant to the customer experience.

But even after a customer has completed onboarding and made their way through the conversion funnel, the struggle isn’t over. The next challenge? Deepening the customer relationship. For FinTech brands, debit card activation and usage is becoming a crucial monetization driver, but many of these companies still struggle with getting more users to adopt. To improve their rates, FinTechs should get creative by consistently testing and optimizing their creative and copy to ensure each message is having its maximum impact. For debit card usage, that might mean trying out different spins on its value prop to see if people are more likely to use the card if it’s framed as a “treat yourself card” or a “rainy-day fund card.”

Building these sorts of customer-first experiences doesn’t have to be challenging. The differentiator is all down to the way messages are conveyed and timed in order to change customer perception. If your customer engagement platform is built to support robust message testing, getting where you need to go is more about strategy and care than complex systems or approaches to customer engagement.

4. Solicit and Monitor Feedback Across the Entire Customer Journey

Executives at large banks often cite positive J.D. Power customer satisfaction scores to argue that their digital customer experiences are exceptional. But while these metrics are important, they give an incomplete picture of how customers think and feel about the financial brands they patronize. To get a true understanding, banks and other financial brands need to look beyond customer satisfaction scores in order to achieve the greatest ROI on customer experience investments.

To make that happen, it’s crucial to ask customers for feedback across the full range of individual touchpoints in order to accurately identify where your brand’s customer experience problems lie. Many financial institutions throw significant time and resources into reducing process time—a common and well-known pain point in the industry. But before taking this on, consider asking for customer feedback immediately after key actions are performed. You may find that process time wasn’t the cause of the customer dissatisfaction; instead, it could have been the lack of status updates received by customers. The point? That banks can’t possibly know everything a customer is feeling. If you want to know, you have to ask them. That can mean sending email surveys, asking them to share preferences and feedback via in-app messages, and beyond.

The impact of timely feedback on financial brands can be remarkable. First, banks and other financial brands can better understand what’s actually disrupting their user experience and can allocate investment dollars more effectively. With proper fund allocation and better results, marketing organizations will be in a better position to receive more funding for future initiatives. Plus, because it takes years to build customer loyalty and only a single bad experience to lose a customer, anything you can do to remove pain points and bolster the customer experience is going to help your brand’s bottom line by reducing churn and improving the impact of your acquisition dollars.

Final Thoughts

Done right, messaging can accelerate investments made into digital banking customer experiences. Banks and other financial firms who transition from batching and blasting business-centric messages to carefully creating customer-centric outreach will find themselves in a better position to deliver relevant, connected, and value-driven experiences that can rival top brands in other industries.

Time is of the essence. Rising generations who have never known life without digital will soon enter the workforce and demand the kinds of personalized, connected experiences they’ve been trained to expect by leading disruptive brands. And only financial brands who are prepared to meet that challenge will be able to thrive in an ever-more-challenging environment.

To learn more about cross-channel messaging and how it can positively impact your marketing, check out the Braze cross-channel report and find out how the right mix of messaging channels can boost engagement by up to 844%.


Erin Bankaitis

Erin Bankaitis

Erin advises enterprise clients and prospects on growth strategies, business case development and offers financial services industry expertise through her prior experiences. She started her career at J.P. Morgan Chase & Co., where she was responsible for identifying and vetting partnership opportunities for firmwide strategic initiatives and supporting the CIO on technology strategy communications to the investor community.

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