Every bank wants more clients, period. Developing mutually beneficial, profitable relationships and maintaining them over a long period of time is the best possible way to ensure the future success of your organization. But not every banking client is created equal.
There’s no doubt banks have a preference for mass-affluent clients that are obviously more profitable to work with. Developing relationships with business owners too is a wise move. That said, even daily bankers with modest incomes can become some of your best banking clients — with the right relationship building.
Of course, it’s easier said than done, especially in the current banking environment when clients are chasing the best rates and promotions, free to do so with the ease Open Banking has provided. So what exactly does it take to build the best banking clients?
What Defines the Best Banking Clients?
There’s a few key indicators of a top-tier client. While simple to identify, they can be difficult to attain. Here’s what you should look for:
Primary Account Holders: This is an absolutely essential factor. With so many lucrative promotions to choose from and the rise of feeless digital banks, many clients are opting to hold multiple accounts simultaneously across various institutions.
However, there’s one type of relationship more important than all the rest — the primary account. This is defined largely by the account into which pay cheques or other income gets deposited into first. For banks this means the odds of that money becoming profitable across their products is significantly higher.
Engaged With Multiple Products: If you’ve got a customer only accessing one of your bank’s products, it would be difficult to call their relationship “sticky.” What would stop them from simply dropping their savings account if a better offer or a higher interest rate was offered by a competitor?
However, if they spread their relationship across multiple products, especially over a short period of time, it is much easier to maintain a long term relationship. Replacing one product might be a simple task at the next great deal, but it might not be worth it to do so with five.
Generates an Annual Profit: This one seems obvious, but it’s important to note. The best banking customers are profitable ones. And the best banks provide desirable products to clients who in turn use them profitably.
This is the trick — finding clients that share your core values as an institution, and offering them high-quality products and services which they’ll access — and pay for — making for a mutually profitable relationship.
How to Build the Best Banking Clients
We’ve established that all banking clients are not created equal (obviously your mass affluent clients will have an edge here). But luckily, there are tools at your disposal to encourage the traits you’ll want to see in the best banking clients.
If you want to boost primary accounts, you need to drive targeted incentives that appeal to the specific interests of your customers, and reward them for depositing their money at your bank, first. While anyone can run a shotgun promotion, your advantage should be targeting microsegments and appealing directly to the needs of individuals.
To encourage customer interest in multiple products, and to engage with them over a short period of time, building attractive product bundles designed to appeal based on the relationship data you have is a great start. Rather than pick one or two products, clients buying bundles will automatically develop a deeper relationship with your bank right off the bat.
If you want to keep customers that are profitable, your bank needs to develop and build product offers that drive the right kind of customer engagement — those aligned with your core values and who appreciate the environment of digital transformation that will inevitably be vital to your institution’s success.
And the way to do this is quite simple. Zafin’s platform offers the relationship building tools your bank requires to build the best banking clients. Want to find out how it works? Contact us for a demo today!
Zafin (@zafin) is a leading financial technology provider that enables banks to form richer, more personalized client relationships. Built from the ground up for financial services, its platform empowers banks to enhance revenue and operational efficiency. Founded in 2002, Zafin sits among North America’s top FinTech companies, and is trusted by retail and corporate units at some of the largest banks worldwide. Headquartered in Toronto with global offices, Zafin has a proven track record with a 100 percent client retention rate as validation.
Cam is the Product Marketing Strategist at Zafin. With a background in journalism and a passion for blogging, Cam strives to tell compelling digital stories. At Zafin he will share the latest trends and news in the FinTech world, and share the Zafin role as leader in the industry. Follow him on Twitter @CamSmoth