More than 2 billion people cannot access formal financial services and most of them are located in developing countries. Yet, when it comes to reducing the financial inclusion gap, microfinanceinstitutions are one of the most efficient at helping low-income communities access financial products and services. However, one of the main obstacles microfinanceinstitutions, especially African institutions, […]
How to Improve User Onboarding
Customer relationships are at the core of today’s banking industry, and competition is becoming more intense by the minute. Onboarding has become a very popular word among financial institutions, since it provides means to secure customers, grow revenue and stay competitive. However, due to the massive changes customer loyalty has suffered over the years, finding the most efficient ways to attract and retain customers has become increasingly more difficult.
The Importance of User Experience
The experience of the user is key, not only to ensure customer satisfaction but also customer retention. By nurturing new users acquainted with a bank or credit union’s products and services, institutions are able to set the tone for their relationship and if done correctly, onboarding can:
- increase the customer’s lifetime value,
- reduce churn rates
- transforms interest into engagement
Customer acquisition, getting the user interested in your product and buying what you have to offer it’s only the first step. The fact is that building a long-term relationship with a new customer is 16 times more expensive than inspiring loyalty among existing customers. In addition, a 1% difference in retention rates can translate into a 12% impact on the value of a company, according to SaaS Capital.
Hence, by creating and executing a successful onboarding strategy, your clients can become your best salespeople, recommending your products and services to others, but also your best buyers since, according to Hubspot, the highest revenue comes from existing customers. Furthermore, satisfied customers have little to no interest in changing providers.
What Customers Want From Their Banks
Nowadays, users are more interested in having a satisfying experience with their banking providers, during which they feel cherished, understood and that they can learn how to improve their finances, thus gaining independence. In fact, according to a 2017 study conducted by Deloitte, 38% of customers consider user experience (UX) to be the most important factor when choosing a digital bank.
They value customization, expert advice and institutions that help them pursue their individual goals. Customers are interested in having mobile-friendly platforms and benefits tailored to their specific needs and interests. However, they prefer interactions to be flexible, simple and quick, as well as to be able to perform any task at any time from anywhere in the world.
The key to creating an engaging and effective onboarding strategy is precisely to understand the customer: what motivates them, what they might require from a financial institution and the best ways to provide it. In order to obtain in-depth knowledge of who their customers are, banks and credit unions need to collect data via their different channels of communication (website, app, social media, physical branches), analyze and interpret it.
An Omnichannel Approach to Onboarding
Most interactions via mobile channels continue to be rather superficial so, in order to create more in-depth relationships, having an advice-based approach is the right way to go. They can provide users with valuable, educational information to help them understand the benefits a certain institution’s products or services pose for them. By strengthening their relationships with users, companies will turn a better profit.
Regardless of the channels through which a bank or credit union chooses to communicate with its customers, the onboarding process has to be perceived as one. By providing personalized experiences and accompanying the client across the different channels, customer satisfaction increases.
The combination of digital and physical interactions can be the perfect solution. Digital channels cut operational costs, automate and accelerate processes and free employee time that can be applied to more important tasks. It also enhances digital user experience, reduces the need for paper and the risk of misplacing or losing documentation.
Despite the fact that digital banking has become a major part of the banking industry, physical branches are still one of the best ways to turn potential customers into actual customers. In fact, even though 73% of users start looking for financial products and services online, 60% prefer to physically visit the different financial institutions to decide on the best one for them, especially when it comes to open a new checking or savings account.
Contacting users who leave online applications unfinished is a good way to engage them across different channels, for instance. Physical branches could, instead of acting as the primary point of contact, help improve relationships with users once they’ve filled the applications online.
A Service Design Approach
In order to build a comprehensive omnichannel approach to onboarding the key is a service design approach, based on the following principles:
- Users are the protagonists: for an onboarding strategy to succeed, it is important to always keep the user’s wants and needs in mind.
- Actions must be correlated: putting together a user experience and customer journey requires a sequence of correlated actions, where users feel they are moving in a specific direction with the company at its side, guiding them through every step of the way.
- Design should be the result of co-creation:the design should take into account both what the user wants and what the bank expects.
In order to adopt a service design approach efficiently, financial institutions need to find a balance between what users want, how viable a new service or product is to the institution’s strategy and if it’s possible for the company to develop the product or service users want.
How to Improve User Onboarding in the Banking Industry
There are several things that a financial institution must keep in mind and continuously build upon when building an onboarding strategy.
- Onboarding shouldn’t be the last item in the path to building a new product or service. By integrating onboarding to the design, it can organically fit into the idea of a product or service. Explaining to users how to take advantage of a product or what it product does, is something crucial to engagement. Avoid the haste of having to include it at the end and make it seem as an afterthought.
- Consider onboarding as a product itself. Devote a team to providing everything users might need to better understand your products or services, how to use them and how they can be beneficial to their day-to-day lives.
- Cater to a specific user. By doing this, not only will you understand your customers better, but also guide them to their own “aha” moment (the moment charged with positive energy where they become convinced they need what you offer). Having users recall that specific moment can help institutions create better user experiences and improve customer satisfaction.
- Keep it simple. Banking is quite a difficult area for the average user, and as such it is important to explain complex concepts in simple, approachable ways, especially when these concepts are intimately connected to your product or service. Visuals are a great way to engage users and help them understand complex ideas. Bear in mind that the human brain processes visual information up to 60,000 times better than blocks of text
To successfully put together an onboarding process, financial institutions need to build a process to lead users from the tasks they need to complete outside your products or services to your products or services. The connection between their outside world and what you offer is what will determine their engagement, their satisfaction and ultimately, your sales.