Recently, I was involved in research involving retention of customers who are with our ‘legacy’ banks and how our customers are influenced to change their main bank based what’s on offer from other banks. In summary - most of our customers look for the bank that has the best offerings, but now - as it is extremely easy to change banks due to schemes like the current account switching service - customers are more likely to change their main bank if they feel another bank is offering them more.
This got me thinking - and it lead me to think about what’s the algorithm for retention? and from my research - a customer is more likely to become loyal to a company based on:
- What Initially is on Offer
- Retention through Innovation & Developments
- Personalised & Tailored Rewards for Loyalty.
It’s in my opinion Monzo has achieved the first two retention elements, however, (and its the same for all banks) - there is no reward system for hitting milestones.
This is where Monzo could influence this space through rewards for retention. So what does this look like?
The Basics - App recognition when milestones have been reached - examples would be 1 year, 5 year, 10 year, 15 year, 20 year etc. milestones. Other things Monzo could look at… Milestone letter thanking each customer for being a continued part of Monzo, free merchandise, different app badges (bronze, silver, gold), community badge etc.
Personalised & Tailored Rewards - Money off vouchers (based on where a customer shops, potential prize draws each month, account benefits based on milestones (cheaper Monzo Plus offerings, better rates on borrowings etc).
The list is endless but I hope Monzo captures this and ideally influences their current roadmap.
What do you guys think?