Why banks should focus on share-of-wallet initiatives now
Banks spend an incredible amount of time and money on acquiring new customers, but so many of these relationships fall short of their potential. Consumers have more options for choosing financial services providers than ever. Instead of vying for their scarce attention, you’ll probably get more from targeting your existing customers with share-of-wallet initiatives.
Why share-of-wallet matters for banks
Our research indicates that you can generate over a 70% return on initiatives targeting existing customers. You already own significant internal data about your customers, but most banks take a broad-brush approach with low success rates and reduced returns. We believe you can more effectively tailor your marketing by identifying unique customer attributes and specific customer needs.
We recommend three ways for banks to expand their share of wallet
- Design a customer insight model based on multiple data sets. This will help you to identify individuals with a higher chance of wanting additional products and services.
- Once identified, target higher priority customers and segments with appropriate product offers.
- Develop campaigns that include specific solutions. Doing so helps you create a marketing strategy and a framework to target and follow up with prospects.
The bottom line
As the COVID-19 pandemic subsides, savvy leaders will shift their marketing investments from acquiring new customers to retaining and expanding their relationships with existing customers. In a time where every bank is focused on revenue growth in a constrained and competitive environment, making smart choices with limited resources can provide a fast track to higher-margin growth.
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