Neobanks are changing the game when it comes to banking, offering customers a digital-first experience that's easy to use and highly convenient. However, with more players entering the market, the competition is becoming fierce, and neobanks need to find new ways to attract and retain their customers.
In this blog post, we’re going to look at how digital gift cards can be used by neobanks across three key areas of their business - acquisition, engagement, and retention.
The idea of using an incentive to attract new customers isn’t exactly new. In fact, it’s fairly commonplace in the banking industry, and many traditional banks offer a lump sum cash reward to customers who choose to switch.
While these incentives aim to help banks achieve primary status, the reality is that many consumers who take up these introductory offers don’t actually close their old accounts.
Moving money around has become so easy that consumers no longer feel the need to switch banks entirely; they simply open a new one, take advantage of the offer and continue to use their original provider.
More than a third of all Americans have more than one checking account
Rewards and incentives are a powerful way to attract new customers, but to see sustainable and profitable growth, neobanks also need to focus attention on account engagement and retention.
To achieve primary status, neobanks need to encourage users to engage with their accounts. This involves finding a way to incentivize users into making regular deposits and withdrawals.
An easy way to encourage account activation and engagement is to implement a digital rewards program. This not only encourages customers to use their neobank account more frequently but also creates a sense of loyalty and community around the brand.
By harnessing the power of digital gift cards, neobanks can offer their customers enticing rewards for performing any number of banking tasks - whether that be depositing a set amount each month, scheduling direct payments, or using their card a set number of times in a given period.
With so many challenger banks emerging, neobanks aren’t just competing with traditional banks - they’re also competing with each other, making a long-term loyalty strategy all the more important for sustainable growth.
By creating a tiered loyalty program that offers increasingly valuable rewards, neobanks can incentivize their existing customers to not only use their account more frequently but keep doing so long after their new customer novelty wears off.
Referrals are another key way for neobanks to secure continual customer growth. By rewarding existing customers for referring their friends and family, neobanks can tap into the power of social proof and increase their reach in a more cost-effective way than traditional advertising.
To make referral rewards attractive and effective, neobanks must make the process as simple and user-friendly as possible. Digital gift cards provide the perfect solution, enabling neobanks to offer instantly available and personalized rewards to each customer via their existing banking app.
Tillo makes it easy for neobanks to balance acquisition, engagement, and loyalty by connecting them to the brands their customers love most.
Our award-winning platform and plug-and-go API offer neobanks the opportunity to connect seamlessly with the fastest-growing digital gift card network with 2,000+ brands across 36 countries.
What’s more, by utilizing the Tillo platform, neobanks can take advantage of the best gift card discounts, helping them to lower their cost of acquisition and making their rewards and incentive programs more cost-effective.
To find out more, get in touch with us today.