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The financial services industry has a lot to learn from its retail and travel counterparts. The prevalence and popularity of rewards programs, from local coffee shops and national supermarkets through to domestic and international airlines, make them a basic consumer expectation.
Keeping pace with change is essential, and it’s up to retail banks and credit card providers to keep up — especially when rewards are perhaps the only true differentiator between financial services products.
It’s likely you already have a rewards program in place. But the worrying stats for the banking industry are this: more consumers are satisfied with their retail rewards than are satisfied with their finance rewards. And only 31% of consumers say they are receiving a ‘great service’ from their finance rewards program. So there’s definitely room for improvement.
The opportunity is huge — 70% of consumers say the rewards offered by financial services providers will have a ‘major impact’ on their purchasing choice, and a fifth of program members admit they would spend more with their reward program if they were offered more personalized and relevant rewards.
The stats paint a clear picture: the benefits of a successful reward program are significant. Here’s what you need to do.
Tip #1 – Personalize & Provide Choices
Over eight in ten (82%) of consumers feel their provider’s rewards program would be better if it offered more choice. In short, you have no choice but to offer choice — everyone expects to see some options. Better still, personalize the options based on what you know about each customer. You’ll likely see redemption rates increase immediately.
Tip #2 – Improve Digital Access & Go Mobile
More internet searches now come from mobile devices than desktops — just another sign that we are moving towards a mobile-dominated world. Finance customers, as you know, are no different. Yet, sadly, only two in 10 finance reward program members say they can access their rewards online.
One in three consumers are choosing to buy products from a provider other than their primary bank. Yet with the cost of keeping an existing customer at around 10% of the cost of acquiring a new customer, financial institutions are missing a trick when it comes to unlocking the value from their existing customer base. Today’s consumer expects to manage their rewards on any device, at any time, at the click of a button. For a truly seamless customer experience, rewards programs should be integrated into the ‘anywhere, anytime’ financial services journey – not bolted-on. Only then will you be offering a rewards program that meets, or even beats, the standards set by retailers and airlines.
To meet demand, make sure your reward program is always-on, user-friendly and optimized across desktop, tablet and mobile devices.
Tip #3 – Keep Rewards Within Reach
Make sure your rewards aren’t more hassle than they’re worth. To keep members engaged and active in your program, try offering rewards that are lower in value and attainable over a shorter time frame. Similarly, think about building in a ‘points and cash’ functionality, so members who are close to purchasing their desired rewards can get there that little bit quicker.