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Customer loyalty for banks and credits unions

Customer loyalty can’t be talk about enough in the market place.
I read an article on BankTech.com by Matt Gunn entitled 5 Things Everyone in Banking is Talking About. Matt discusses “Loyalty/Stickiness” as one of his five banking topics of the day. Reality is that customer loyalty is always a topic of concern for businesses despite their industry. But I think Matt’s point is about the urgency of loyalty at this time. New financial regulations are impacting fee income for financial institutions which is resulting in dramatic shifts in standard bank offerings.

Customer loyalty is made from customer focus.
The articled triggered a thought about an blog post that’s been on my “to write” list for some time. The big idea is that online banking integrations to financial services and products help create stickiness that promotes customer loyalty. But it’s done so in a way that creates value for the customer. A few weeks ago I wrote about how online banking integrations help customer focus efforts. Another effect of effective integrations is they make online banking the launch point to related financial services.

The importance of online banking as a financial portal is more important than ever.
If online banking is tied to other financial services such as bill pay, account opening, loan applications, credit monitoring, credit card transactions, etc. then it becomes a master portal for the customer. The financial institution’s brand is the primary brand within portal and the primary relationship that is linking all of the additional services. This creates stickiness and loyalty.

The opportunity for integrations is at hand.
Savvy financial institutions will have personnel in directly responsible for eBusiness integrations that customers use through the online banking experience. In effect, the online banking experience becomes a banking branch. It offers access to transaction based activities that can be completed by customers as self-service activity.

Expanding the use of online banking is not losing customer touch.
At first thought this may seem counter intuitive because pushing more transactions to the online banking application takes customers out of a branch where relationships are built and loyalty is formed. Reality is that mobile devices and the accessibility of broadband services have created a world where consumers try to bank from a variety of locations. Brett King, in his book Bank 2.0 : How Customer Behaviour And Technology Will Change The Future of Financial Services, discusses this concept of consumer choice. He says:

Customers choose the right channel at the right time for them, depending on a number of factors such as time constraints, always-on availability, complexity, and the likelihood of a ‘deal’.

My credit union gets it.
In the past couple of years,  my credit union has integrated with personal finance manager Finance Works (by Quicken), Turbo Tax, and a remote deposit service. I should note that I stopped using my local version of Microsoft Money and replaced it with Finance Works. This year, I didn’t purchase a local copy of Turbo Tax. Instead, I used the integrated version offered by my CU. It is becoming my financial portal for more and more activities. Combine that with no gotcha fees, above average deposit interest rates, and below average loan interest rates and customer loyalty doesn’t seem like such an elusive concept.

  • Jim Marous

    Both of us must have a backlog of blog ideas, because I have a post entitled, ‘Leveraging Mobile Banking for Engagement’. You are spot on with regards to the fact that both mobile and online banking do not threaten relationship building, but can enhance the process. Take a look at PNC’s Virtual Wallet. What a great example of an online and mobile banking product that has both engagement and loyalty built in. Maybe in the next week we will both finish our posts to provide a deeper dive into the connection between channels and enhanced relationships.

  • Sol United

    Magento Themes
    But the customer is also stuck into his chores and he have to be loyal with the bank to carry out all of his works which are not possible without hte bank