4 Ways to Get Consumers to Like Your Bank

Though the U.S. continued to heal from the Great Recession’s deep wounds in 2011, banks suffered from a backlash of consumer animosity, which is not expected to go away anytime soon.

Because of the lingering consumer protestations toward FIs, banks should reshape their policies and priorities this year in a way that is more consumer friendly, argues Javelin Strategy & Research, the consultancy. In a webinar held yesterday, Javelin analysts identified four trends that FIs should be zooming in on in the next 12 months. Here they are:

• Lock consumers in. This year will continue the internal consumer debate of whether convenience or fees trump their loyalty ties to their institutions. In general, Javelin’s research shows that “anger” isn’t enough to persuade a consumer to switch banks (well, not in my case). Because consumers are still puzzling over brand loyalty, institutions must find ways to “lock” the customer down. The analysts recommend that banks need to be better allies to consumers and should, for example, offer more PFM services online.

• Find more power within mobile and social media. With disgruntled consumers winning more power by using their social media voices (think big banks’ reversal of checking account fees), banks need to realize it is not smart to ignore the power of a group, especially a vocal group. Institutions can use the same technologies as consumers to monitor positive consumer comments, too. FIs should also realize that not all fees introduced will elicit protestations. Fees with value to consumers should resonate fine with consumers. 

• Social media has given birth to the decline of knowledge-based authentication. With less knowledge-driving authentication, biometric technologies are officially becoming more mainstream. Javelin believes the ubiquity of smartphones will further push ubiquity of biometrics, citing the 4S Siri voice recognition, Android Ice Cream Sandwich Face Unlock and Motorola Atrix Fingerprints as three tools already helping consumers to become familiar with biometrics.

• Geolocation matters. Geolocation has become a “notable” function as it provides consumers with richer user experiences by adding value to mobile payment, loyalty and security functions. The technology, according to Javelin, transforms the way in which consumers and businesses engage. The consultancy’s tip? Integrate geolocation to enhance the mobile delivery of FI rewards. Currently, the consultancy says institutions must work within the current limitations of GPS, though.

Not on Javelin’s list: being nicer.