Acquiring new customers that are the right customers for your business is difficult. This is especially true in the world of financial services. Those who serve the underbanked are seeing increased competition as more companies are finding ways to serve customers more quickly and nimbly. To win over customers, financial institutions need to more clearly define their value proposition, increase the quality of their services, and lower costs.
A one-size-fits-all approach to customer acquisition that does not take the priorities, needs and wants of the individual customer into account will increasingly lose out. To stay relevant and competitive, institutions need to be dynamic and build targeted customer acquisition strategies that leverage customer understanding, digital innovations, new data sources, and smart partnerships. A well-designed approach should prioritize which groups to target and engage with customers in a way that adds value for both the client and the institution.
Steps for reaching new customers
Determine customer segments
The first step to creating a more targeted customer acquisition strategy is to segment the customer base by shared needs, interests, and priorities. Customers can be grouped using a number of different variables, including demographics and business types, customer behavior, and customer needs and attitudes. Using data for segmentation increases the institution’s understanding of customers, helps identify and estimate market opportunities, and allows for client-specific tailoring of products, services, and customer experiences. When executed correctly, it benefits the client by addressing their needs and the institution by helping to acquire and retain the right customers.
Prioritize customer segments and think about viability
The next step is to prioritize which customer segments to target. Once the customer segments are established, the institution should assess what makes a segment attractive to them. This includes not only profitability, but also location, demographics, and other factors. FSPs should prioritize those groups where they can offer greater value than competitors through differentiated products, services, and terms. This ultimately leads to a higher return on investment.
Define the value proposition for a customer-centric product or service
Next, a financial service provider must focus on the customer. What do customers want and need? How does the product meet those needs? It’s critical to define a value proposition for each segment, based on the validated customer needs, and to communicate that value clearly via compelling marketing messages.
Optimize channel strategy and integrate digital
After defining the value proposition, institutions should focus on optimizing their channel strategy. Are there new ways to reach the customers? Are there any viable partnership opportunities to better serve customers? Is the channel reaching the right customers? Then, identify and prioritize the channels (both non-digital and digital) to reach customers based on segment preferences and channel profitability.
When it comes to acquiring new customers, it’s critical that providers consider the advantages of integrating digital. Digital channels increase efficiency, lower costs, and provide a rich source of data that can be used to target customers with a whole range of customized products. Many fintech firms and digitally mature FSPs are acquiring (and retaining) customers using a mix of marketing tools and onboarding channels that are enhanced by strategically designed digital and physical touch points.
Execute Sales Plans
An institution will only see the benefits of these efforts by efficiently executing sales plans for each channel. By leveraging automation and customer data, FSPs can monitor metrics along the way. These metrics are critical to inform adjustments that maximize profitability and ensure mission alignment.
Resources for building a customer acquisition strategy
Recognizing the current market need, Accion’s Global Advisory Solutions team has developed a free eModule and corresponding toolkit for managers that want to learn more about how to develop a targeted customer acquisition strategy at their financial institution.
Accion is also offering a facilitated online course, How to Reach the Right Customers in the Digital Age, in partnership with CGAP’s Gateway Academy, for institutions who are looking to develop a targeted customer acquisition strategy. We recommend that more than one person from each institution take this course. This will make the course more practical and provide more opportunities to connect learnings to the business.
In this 5-week facilitated course, the learner will explore each of the above steps in-depth and utilize tools for applying these concepts. The task for FSPs – whether fintech startups, microfinance institutions, or commercial banks – is to determine how to best balance tech and touch throughout the customer journey.
New tech and innovation entering the market is ripe for cultivation, and it can be leveraged for the benefit of customers and financial service providers alike. We’re excited to be working alongside our partners and clients to help them navigate these new opportunities, and we hope our latest online tools and resources will benefit the industry and underserved communities around the world.
Any questions or interested in learning more? We’d love to hear from you! Send us an email.