By Shirra Frost
The digital age is completely changing the way consumers engage. Consumers have embraced their mobile devices to do almost everything, from interacting with friends and family to shopping to researching the best places to vacation. As mobile devices continue to become an integral part of daily life, today’s consumers expect real-time communication with their financial institutions and greater control over their day-to-day finances.
Financial institutions have the opportunity to meet these expectations with alerts.
With the right type of alert strategy, financial institutions can help customers monitor and manage their finances while also driving higher engagement and growing revenue.
Most consumers receive digital alerts via email, SMS (text message), or push notification (mobile-app generated notification). According to 2015 Fiserv research, the financial alerts that most interest consumers include:
- Unusual activity on credit cards or at ATMs
- Credit card transactions that exceed limit, are declined, or are out of usual geographic area
- Requests to confirm changes in account access or contact information, or access from unknown devices
According to the same Fiserv research, it is even more common for small businesses to receive financial alerts compared to consumers. The alerts that most interest small businesses (those with revenue between $100 and $999K) include:
- Unusual activity credit cards or at ATMs
- Deposits to accounts have cleared or failed to clear
- Credit card transactions that exceed limit, are declined, or are out of usual geographic area
- Requests to confirm changes in account access or contact information, or access from unknown devices
Both consumers and small businesses have an appetite for receiving alerts from their institutions. These groups value alerts that help protect assets from fraud—and alerts that warn of possible fees or account problems. Small businesses are even willing to pay for actionable alerts that could potentially protect their business assets. Financial institutions have an excellent opportunity to drive real value to their consumer and small business customers, as well as add revenue to their bottom line, with alerts.
Even though today’s digital consumer is constantly bombarded with messages such as texts from friends and LinkedIn updates, financial institutions can cut through the clutter with valuable and proactive financial alerts. Alerts can help an institution enhance engagement and grow the customer relationship. An effective alert strategy can also help to position that institution as the customer’s number one go-to institution for financial services.
Promoting alerts and driving a stronger adoption and engagement strategy can be achieved in 3 ways.
1. Make Alerts Relevant.
It’s not only important to think about what type of alerts customers want to receive and when, but also to think about how to target relevant alerts and notifications to the right customer. App-generated push notifications that expand alert capabilities well beyond simple balance and transactional updates allow financial institutions to engage with consumers at a deeper level as well as cross-sell and upsell services where appropriate.
2. Create Relationships.
While the most common types of alerts are generated in reaction to situations such as low balances or unusual activity, alerts can also be used to talk to your customers proactively and stay connected. Managed correctly, alerts can become a daily conversation with customers to build trust and strengthen an institution’s brand. For example, sending alerts about upcoming events such as new loan rates might trigger inquiries about refinancing opportunities. Customers who are interested in a particular service or product, or who want more information, can take immediate action through a click-to-call function within the push notification that connects them directly to a financial institution representative.
3. Promote Actionable Alerts.
Actionable alerts are particularly appealing to consumers because they provide an opportunity to take immediate action, right in step with the pace of people’s busy lives. Promoting the ability to take action so people can stay in control of their finances can prompt them to sign up for alerts. Real-life examples are a particularly good way to emphasize the benefits of actionable alerts. This could include depictions of situations such as immediately transferring money upon receiving a low balance alert or to paying a bill upon receiving an alert that a bill is due.
Timely, relevant, actionable alerts are increasingly in demand and will continue to be important in the future.
The road map ahead shows a world of possibility to grow and enrich the institution-customer relationship. Imagine the opportunities that could arise from integrating the alerting platform across businesses—for example, lending, credit, or investment services platforms. Potential conversations could include:
- “You’ve just deposited a large sum in your savings account. We can offer you better rates with our mutual funds portfolio bundle. Interested to learn more?”
- “Your car lease expires in three months. It might be time to speak with us about our new lease rates. Tap here to find out more.”
This level of engagement builds trust with customers and promotes new revenue opportunities for the institution.
Financial institutions have new opportunities to redefine their approach to alerts in a way that satisfies customer demand and generates value. A successful alerts strategy requires investing in alerts to achieve stronger engagement and the potential for cross-sell and fee revenue opportunities. With alerts and notifications, financial institutions can differentiate themselves from competitors and position themselves as trusted partners.
Shirra Frost is director of product marketing at Fiserv, a financial services technology firm based in Brookfield, Wisc. Email: [email protected].
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