By Ana Williams, Marketing Director at Airship

The banking industry is going through a major shift, as more and more consumers switch to mobile apps and digital channels for their banking needs, rather than traditional bricks and mortar branches. The pandemic accelerated this trend, as brands and consumers rapidly adopted mobile commerce.

In fact, a global banking survey produced by Deloitte in 2020 highlighted just how much the pandemic has changed financial services and sped up development of digital channels. It found that 60% of banks have closed or shortened opening hours of branches, while many have implemented new digital features, such as fully digital account opening processes (34%), remote identification and verification (23%), and contactless payments (18%).

The advent of Open Banking has also affected this trend. The introduction of the Second Payment Services Directive in 2018 required European banks to open their APIs to third party providers, allowing them to access account information and operate financial services on a consumer’s behalf. This has created new competition and given consumers more choice and options when it comes to mobile banking.

Consumers now have much higher expectations of what financial apps should offer, especially as it is easier than ever to switch banks and banking providers. As such, it is mission critical for financial institutions to constantly innovate, test and optimise their mobile apps to deliver the seamless experiences that today’s banking and finance customers’ demand.  The ones that stand out and successfully engage consumers with their apps will gain a significant competitive advantage.

But what should banks do to improve their apps? To help banking and finance brands meet this challenge, here are my five best practices for optimising financial services mobile app for greater engagement, retention and building customer loyalty.

Make your onboarding process easier 

Did you know that almost 3 out of 10 apps are deleted from a user’s devices within 30 days of being downloaded?  Or that 25% of apps are used just once after being downloaded?

Given these tough odds, it’s important to experiment with your onboarding flow. Streamlining the onboarding process can increase adoption and kickstart customer engagement. In fact, one of Airship’s financial services clients achieved a 10% increase in conversions and a 6% increase in sign-ups just by simplifying its onboarding flow from four screens down to just one.

Segment your audience for success 

Today’s app users expect a personalised experience, and they will have different needs according to their location, account types and other factors. For instance, if you’re a payment or banking app, the messages for your business customers may not be relevant to other users. Therefore, it’s important to segment your audience by demographics, geography, behaviours and user-level attributes so that you can make every message more personalised, relevant and relatable to your users.

Make the experience more personal

After you have segmented your users, the next step is to drive action and engagement by sending personalised messages across all of your app channels. Every channel within your app can play a role in keeping your customers informed, engaged, and delighted. By using push notifications, message centre, live in-app chat, in-app messaging, and even mobile wallet messages, you can alert customers when deposits are made, payments are due, and provide information about special offers.

Sending relevant, timely and personalised messages can add significant real-time value to the app experience. It can also encourage customers to use additional services. For example, using location-targeting, a financial institution can determine their user does a lot of travelling and that they might be interested in seeing the bank’s exchange rates or travel insurance offers. Likewise, fraudulent activity can be identified using both physical and digital data points, and customers can be immediately notified through all opted-in channels, whether that’s SMS, email, push notification, or in-app message.

Also, consider using a mobile preference centre to give customers more ways to manage their consents and preferences. This will reward them with an even more personalised experience.

Unlock value with geofencing

Last year, location sharing opt-ins for mobile apps hit their highest rates in years because of the pandemic-induced national lockdowns. Use cases for geofencing services grew significantly as brands and consumers adapted to low contact options such as click and collect.

Banking and finance institutions should consider setting geofencing triggers within their apps to send messages that inform customers about any changes to their local branch’s opening hours and operations, help them locate or access a nearby ATM, or learn about special offers when they’re near a physical branch location.

Put your app features front and centre

As you test, iterate and improve your app, you need to keep customers informed about any new features; if they don’t know about them, they may as well not exist. Sending push notifications or in-app messages can help users discover your app’s valuable features like investment dashboards, mobile transfers, balance notifications and security alerts, and encourage customers to use them.

When designing new features, ongoing testing and experimentation can help drive small continuous improvements that net large business results. For example, the US investment app Stash wanted to encourage more users to save money using Auto-Stash, one of its core features that allows users to save and invest automatically. Testing found that displaying the individual investments on the first screen and making more accessible the “Turn Auto-Stash Off” button drove 12% more users to save and use the auto-saving feature just 8 months after the experiment.

You could also leverage “Feature Flags” to roll out new features to whom you want, when you want, and minimise risk by getting user feedback before launching those enhancements globally. Several of our customers experiment with almost all major product changes on a small percentage of their userbase before rolling them out to all customers. Beyond improved revenue, this also helps them to direct product resources to areas that will make the most impact, as well as mitigating risks to business performance and user retention.

With increasing numbers of consumers across a wider range of demographics adopting mobile banking apps, banks and financial institutions have an opportunity to attract new users and offer them additional services. By adopting a strategy of ongoing optimisation for your banking or finance mobile app, you’ll be able to start delivering massive value that will help acquire, retain and grow this audience. These apps serve as a key marketing and communication channel that will benefit your customers — as well as your bottom line.