We all have our habits and preferred methods to do tasks. When it comes to finances, this is very common. When people find a process that works for them, they are reluctant to change. So it is not surprising that it is challenging to shift some entrenched customers to lower-cost channels.
Take, for example, customers who choose to pay their credit card bill in a branch. Every month, they march into your branch and make a payment. They prefer this method for many reasons, but they can be motivated to change.
By leveraging a Product and Pricing Lifecycle Management (PPLM) platform, banks can create targeted pricing and reward mechanisms to migrate customers to lower cost channels. Consider a program where a targeted segment is provided a reward for choosing a lower cost channel at month one, three and six. Now imagine you deployed this pricing model with no IT involvement and no revenue leakage. This is all possible with PPLM. Zafin’s miRevenue enables product and channel managers to create targeted campaigns to encourage these customers to migrate to lower-cost channels.
The incentive can take on many forms. With miRevenue, you can create a points system that is similar to rewards programs aligned to credit cards. You can create an alternate currency where points for your desired customer behavior are awarded. miRevenue allows you to establish a program to match your strategy. Customers can redeem their points in a variety of ways, including cash back, merchandise or to cover bank charges, such as ATM transactions at other bank ATMs.
Change is hard and often we need an incentive to modify our behavior. Banks should look for carrots, not sticks, to make this happen. The end result could be a measurable shift in customer behavior to low-cost channels and an improved customer experience. Let your creativity and ingenuity be your only limitation in your pursuit of increased revenue.
As a former product manager at Bank of America, Glenn brings a wealth of retail product management experience to Zafin. Join Glenn and our other special guests for our November 13 webinar.
A Tale of Two Customers: Enhancing Retail Bank Revenue with Product Bundling and Relationship Pricing
Wednesday, November 13
How can we incentivize customers to switch to more cost-effective and profitable activities? How can we reward customers for desired activities, but also retain and deepen the bank’s relationship with them?
For answers to this and other questions around enhancing retail bank revenue and profitability, join us on November 13 for a one-hour webinar.
What you’ll learn:
- How Product and Pricing Lifecycle Management drives new revenue by getting the right customers into suitable, profitable products
- How to leverage a strategic, customer-centric approach to improve cross-sell/upsell opportunities and reduce the overall cost-to-serve
- How Bank of the West is using relationship pricing and product bundling to deepen customer relationships and reward customers based upon their full relationship with the bank