Customer Engagement for Financial Services

Engaged and educated retail investors invest more and churn less. We know that. 

A UK study from Charles Stanley found that the main reasons people stop investing are concerns about market volatility and, unsurprisingly, because their investments aren’t performing the way they’d hoped. The same study found that 26% admit they don’t understand the different levels of risk and how to minimize their chances of losing money. 

That suggests there’s a big education gap. A gap that investment platforms and financial services companies can plug by understanding customer engagement better. Afterall, the inverse of investors leaving the market because they don’t understand is that the more they interact with content that empowers them, the more confident they become as investors, the more they invest.

What is customer engagement?

As the name suggests customer engagement involves, well, engaging customers. I.e. Building a relationship with customers through consistent, meaningful contact in order to gain trust and brand loyalty. In a nutshell, it’s keeping them interested and involved with your company and its products and services. With retail investors, this means providing tailored financial advice, promoting educational resources, and reacting to feedback. 

It's crucial that customers are engaged with and understand the services they’re using. Providing investors the tools to upskill and enrich their industry knowledge is a proven way to win their trust. An engaged user is more likely to be an active user – and active users generate higher ARPU (average revenue per user) than dormant accounts. That can make a big difference to your bottom line.

Five strategies to improve customer engagement

User growth on retail investment apps has slowed since it got a shot in the arm at the beginning of 2021. Take Robinhood: Their monthly active users peaked at 21.3 million in Q2 2021 but is now down to just 11.8 million in Q2 2024. Investment apps are shifting their focus away from rapid expansion to more sustainable growth. They are implementing strategies to boost customer engagement and retention rather than costly customer acquisition.

1. Personalize the customer experience

A personalized customer experience is now expected by users of financial services and customers are more likely to interact with content and products that match their needs. A Forrester Consulting study found that nearly 75% of banking customers find product offers more valuable when they’re contextually relevant, and 65% believe financial institutions should make it easier to access products through personalized experiences.

Tailor the customer journey with custom prompts, emails, and alerts that anticipate and react to customer preferences. Send prompts during key interactions to help drive conversions. Customize alerts or email reminders to complete sign up, prompt idle accounts to re-engage, or encourage the completion of transactions.

AI-driven assistants can provide a further level of personalized support, and handle inquiries 24/7, offering quick, accurate responses to customer questions. These tools go beyond just simple Q&A. They guide customers through complex financial processes, enhancing the overall user experience. Automated agents can handle calls with human-like speech, providing personalized assistance without the wait times. AI also narrates videos, making content more engaging and accessible.

2. Ask your customers for feedback

Gathering customer feedback through reviews, social media, and live chat interactions is crucial for financial businesses to understand customer needs and improve products. Modern customers increasingly love engaging beyond just consuming a product. 79% of those surveyed by Edelman in 2023 said they directly interact through participating in brand activities, connecting on social media, or sharing feedback. This increase is being driven by younger consumers and online reviews will play more of a role in customer decision making as they age and their spending power increases.

Feedback enables businesses to make data-driven decisions and involve the customer in shaping the product offering. We analyze between 2,000 and 3,000 unique content requests weekly and millions of consumption data points daily. Over the course of a year, we collect more than 5 billion data points and use them to track how our content performs in three key areas: engagement, conversion, and satisfaction. Our members highlight the most important things on their radars through group chats, regular surveys, and request forms.

3. Create a customer journey map

A customer journey map can significantly increase customer engagement, and minimize ineffective customer touch points. Creating a customer journey map is most effective when you consider the ideal customer experience and recognising that the current journey may differ from this vision.

For us, spotting patterns in how our community engages with content helps us really know our customers. For example, 15% of US stock market investors say they started investing in 2020. So to help those new starters out, our Zero To Invested collection of nine educational guides offers investors a solid foundation to begin their investing journey. The routes these investors take vary, but patterns emerge. Not only is it clear that rookie investors are engaged enough to dig deeper into the fundamentals, but we can see that when someone read or listened to our guide on robo-advisors, 65% went on to learn about exchange-traded funds (ETFs). Once they’d gotten to grips with that, 58% explored portfolio construction.

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And these patterns provide much more meaningful indicators of what a current or prospective investor will do with their money next than just looking at age or salary. From these patterns, we can see the routes that investors took through our platform, informing future customer journey mapping.

4. Choose the best marketing channels for your audience

Understand your target demographic and know which channels grab your audience. Retail investors only spend 15 minutes a day, on average, thinking about their portfolio and where to put their funds. To capitalize on this small time window, it’s crucial to ensure that your brand is at the forefront of their mind. An omnichannel approach means you can find investors wherever they’re looking for answers, be it social media, newsletters, podcasts, or events, as each demographic has their own unique relationship with content, and where they engage with it.

Engaging directly with customers to help create content taps into the evolving way that consumers interact with brands. In a recent article about winning content strategies we spoke to Oscar Mackenzie, Head of Marketing at Shares, about how the relationship between financial brands and consumers has changed. He told us where relationships “have often been transactional and one-dimensional,” consumers now want “a three-dimensional relationship that allows for reciprocated conversations.”

5. Educate your customers

By providing valuable educational content, you help investors grow their financial literacy, increasing both their engagement with your platform and their long-term investment potential. We see much higher customer retention among educated investors and 74% of our customers say they would invest more with more opportunities to learn about investing.

Education doesn’t happen overnight. It takes time to nurture banking customers, and to build them to the point that they feel empowered to part with capital and invest with confidence. Our data shows that retail investors engage with 10-15 touch points before they convert to a customer, so expecting to see dramatic results from one piece of content is unrealistic.

Finimize educational content gets 70% more engagement than any other retail-centric financial information platform. In fact, 90% of Finimize members say they’ve learned something from us, and 40% have taken action because of that learning. That means our content can catalyze increased investment as well as higher engagement rates.

How to Measure Customer Engagement

Customer engagement metrics can provide valuable insights into how well marketing campaigns are resonating with target audiences. These insights can then be used to refine messaging, improve targeting, and ultimately drive better commercial results. Metrics such as impressions, page views, and click rates provide valuable insights into how campaigns are resonating with targeted audiences. They can give real-time updates which can help refine messaging and improve audience targeting.

These metrics should tie into the tracking of a broader business goal. On our Generation podcast, we recently spoke to Alex Craddock, CMO at CITI, who told us about his scorecard of metrics, which provides him both a high-level view of business performance and a detailed understanding of what’s working at a tactical level. Afterall, it’s those that really matter. According to Alex, the higher-ups in the company don’t care about email open rates or post views. “They care about [...] what that’s done in terms of perception and ultimately behavior and desire to buy my product?”

Real customer engagement isn’t just about improving those vanity metrics. It’s about encouraging investor behavior that accelerates growth of the metrics that matter.

Drive customer engagement with Finimize

Want to kickstart these strategies into action? That’s where Finimize comes in: we’re engagement experts. For instance, our audio content consistently captivates investors, boasting completion rates of between 70% and 80% – double the podcast industry average. And let’s not forget our written content, either: with completion rates cruising a third above the industry average, it’s clear that we’ve hit an engagement sweet spot, delivering in-depth yet bite-sized pieces that members can’t put down.

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