Proven tactics to win the customer acquisition game

Deposits are moving again as consumers look for opportunities to get higher yields from their investments. While consumers do shop around for the best deposit rate, they are also looking for the best digital experience – and that starts with account opening. Current online account opening trends at traditional financial institutions have opportunities for improvement.

Oliver Wyman research shows that only 30% of prospective clients will visit a financial institution’s product page, and of those, only a small percentage will complete an application to open an account. As more community banks look to add or optimize online account opening, here’s a key question: What should they consider doing to ensure their investment pays off and impacts deposit growth?

According to the Oliver Wyman report, brand preference is set before consumers consciously decide they want to open a new account at a financial institution. The vast majority of consumers start the switching process with one or a few banks in mind and typically spend less than a month researching options. To capture these high-propensity consumers, banks must focus on reinforcing their brand’s digital presence and search engine optimization (SEO). This ensures their bank is top of mind and top of search engine results, which helps eliminate any doubts for consumers who are ready to switch.

This is why it’s important for banks to engage consumers before they begin the switching process, so when the consumer does make the switch, the bank is already part of the consideration set. Banks must also offer a strong digital experience – from the time the consumer starts researching financial institutions online to the time they decide to open an account. It’s not just about outbound marketing efforts – it’s equally important that banks remove barriers to switching, which requires a truly frictionless account opening process.

Reduce abandonment rates

Most of the nation’s leading banks offer online account opening. However, mobile-optimized account opening that allows customers to open an account in under five minutes is less common. Even rarer still is an online account opening experience that doesn’t require a visit to the bank branch, which leads to high abandonment rates for new account openings.

Other leading reasons for abandonment typically include a lengthy application process, complex forms and the requirement to come to a branch to complete the process. Banks should focus on addressing these specific account opening pain points and ensure their institution’s online account opening experience supports the features that applicants desire most.

To drive deposit growth and acquire new customers, community banks must understand what customers want to avoid the most common pitfalls that result in high abandonment rates. Data from Insider Intelligence shows the most desired online account opening features include the ability to set up direct deposit, push-notification updates during the application process, the ability to chat with a live agent, and being able to easily fund a new account with a debit card, payment app or mobile deposits.

The right functionalities can increase conversion rates, but bank leaders should also avoid common pitfalls associated with account opening.

Mirroring the in-branch process: Online account opening doesn’t mean taking paper documents and digitizing them into online forms. Instead, give customers a simple, well-designed user experience that’s suited for opening and funding an account on their preferred digital device. For example, a bank can save time and errors by allowing applicants to upload an image of their driver’s license and then auto-filling the applicant’s name and address information, rather than requiring the applicant to rekey that information.

Providing a one-size-fits-all experience: The experience when opening an online account should be different for each customer. It should not be too generic and it should demonstrate that the institution understands what the customer is looking for and make it easy to apply for the right product. During the account opening process, the bank should provide clear, contextual options that help the individual choose the product that best fits their situation and financial needs.

The average cost for a bank to acquire a new customer is approximately $200, meaning that between email marketing, social media, digital ads, SEO campaigns and more, banks are spending significant time and resources on customer acquisition. To ensure these efforts are worthwhile, a solid online account opening process with high conversion rates and minimal abandonment is key.

Shaw Taylor is SVP of sales and marketing at Bankjoy