Published : 1 month ago, on 13/11/2024

Alicia Skubick, Chief Customer Officer

By Alicia Skubick, Chief Customer Officer

Everybody has a bank, they have to really, it’s a modern day essential. But not everyone trusts their bank. In fact, widespread mistrust in the sector has led to many commentators to state in recent years that the banking industry is fundamentally broken.

Unsurprisingly, trust in the sector plummeted after the 2008 financial crash – a low from which it has never fully recovered. Even now, consumers are 50%* more likely to say their level of trust in financial services providers has fallen over the last three years. Yet, trust is imperative if you expect customers to share potentially sensitive or confidential information with you. It even ranks higher than price (45% vs 43%)** when it comes to choosing a bank.

So what are challenger banks doing?

There are newer, challenger banks entering the market that are shaking things up. But successfully building a strong brand in the fintech space requires not only proving the product’s functionality and ability to keep financial details safe, but listening to customers too. At the end of the day, trust binds a Fintech to its huge audience.

One such challenger making great strides is UK Fintech Monzo. The challenger bank invites customers to invest in the company through equity crowdfunding rounds and often organises community events at their offices or venues favoured by customers.

This example shows how challenger banks can build strength by involving their customers, keeping them informed, and tapping into topics that resonate with them; all of which strengthen brand reputation.

How can that inspire growth?

And that’s a great launch pad. But once you have customers engaged, it’s vital that banks are using customer content to grow their reach effectively. It can cost around five times as much to acquire a new customer than it does to retain an existing one. Therefore, anything you can do to encourage consumer loyalty will pay dividends in the long run.

Although the finance industry is heavily regulated by the FCA, prospective customers will still want reassurance that you’re a credible enterprise. After all, they’re trusting you with their finances so it’s only natural for them to be cautious. This is especially true if you’re an online-only business with no physical bricks-and-mortar presence.

So showcasing real, honest customer reviews is a great way to alleviate consumers’ concerns and demonstrate you’re a legitimate business that can be trusted to handle their finances.

Challenging the norm to improve

Once reviews have been collected they can also be used to improve the customer experience, and innovate just like challenger banks do. Take another look at Monzo, with its Monzo Call Status feature, allowing consumers to verify they are in fact talking to their bank and not a fraudster.

Not all reviews and ratings will be positive, but that’s not necessarily a bad thing. Negative reviews not only show the positive ones are genuine, but they can also give banks valuable insight into their customers’ experiences. This feedback can then be used to identify areas for improvement, rectify problems and provide a better overall service. Not to mention the fact that if other customers see negative comments being dealt with promptly this will reflect positively on the business.

Final thoughts

Adopting a customer centric approach has huge potential to shake up the banking industry. Not only can you build brand equity and attract customers, but it enables banks to foster trust. Collecting reviews can help banks turn feedback into growth, in fact a new study conducted by Forrester Consulting on behalf of Trustpilot found that organisations that deployed Trustpilot received a 401% return on investment over three years***. As mistrust in the banking sector prevails, it’s vital that more of the industry stalwarts adopt this challenger bank mindset.

*According to a London Research survey of 1,000 consumers, carried out exclusively for Trustpilot across five different countries

**https://www.visualcapitalist.com/trust-banking-industry/

***Findings based on a 2024 commissioned study, The Total Economic Impact™ Of Trustpilot, conducted by Forrester Consulting on behalf of Trustpilot. Results are for a composite organisation representative of interviewed customers.

Author bio:

Alicia Skubick is Chief Customer Officer at Trustpilot, the global consumer review platform that brings businesses and consumers together to foster trust and inspire collaboration.

Previously Chief Marketing Officer, Alicia is now responsible for Marketing, Brand and External Communications and Customer Experience.

Prior to Trustpilot, Alicia built world-class business and technology brands at Intuit, Sage, Western Union and Symantec. Her experience includes global and regional leadership in the USA and Europe, leading both marketing and sales.