Rewarding Customers Changes Their Behavior. True?
Do you believe that rewarding customers changes their behavior? When it comes to attracting and retaining customers, how important are incentives?
Well, as far as customer retention is concerned, it is a good idea to reward them. Additionally, you may sway customers with an incentive. Your focus should be on what, when, and how. This is especially important in the banking sector. While financial institutions want to secure customer data, they do not want any disruption of the user experience.
Can Customers Be Bought?
When it comes to rewarding customers, remember that the right offer must come at the right time. Not only this, it must be the right customer who looks promising to your business and can give you some good returns.
For example, according to a survey, cash-strapped millennials are more likely to try out new authentication methods, as they are the most receptive to rewards compared to seniors. Incentives do offer a lucrative way to sway customer behavior, especially as older customers seem to be aging out of the financial system.
What Does the Survey Say?
According to a survey sponsored by Aite Group to understand consumer behavior and preference for authentication methods, rewarding customers changes their behavior. But with the password losing its value in the financial sector, despite being a key part of the online baking fabric, what next?
According to the survey, an overwhelming majority of banking customers are eager to switch to modern authentication methods despite being comfortable with using passwords. Survey respondents recognize the need for tighter online security measures that are different from the archaic method of authentication and can promise better security to their financial transactions and sensitive data.
Passwords and Biometrics
The Aite Group survey results show that the priorities of the online banking consumer have changed from generation to generation. Different generations of customers have expressed different set of preferences to replace the ubiquitous password, with a majority of them favoring biometrics over other security measures.
Passwords seem to have lost their value as a security measure, as highly skilled criminals are able to break passwords. However, despite losing their value, usernames and passwords will continue to be in use in the online industry until stronger alternatives are in place.
The advent and proliferation of mobile devices promises a new beginning in the financial sector. With it, comes the promise of better authentication capabilities like finger print authentication that promises better security and user experience than a password.
The survey report reveals that 95 percent of millennials have no problems with using other authentication methods. The story is the same with a majority of other consumers, including Baby Boomers and Gen X. However, only 16 percent of elders are open to learning new authentication methods, though 48 percent are okay to go ahead with them.
When it comes to reviewing new authentication method preferences:
- Millennials are the most receptive audience, who see biometrics as the most effective identification methods.
- Generation X also cites fingerprint, eye biometrics and authentication questions as top password alternatives.
- Baby Boomers are more in favor of biometrics and facial recognition when it comes to choosing a password replacement.
- Seniors favor fingerprint biometrics and facial recognition as effective security or authentication measures.
The survey clearly points toward the losing value of password in the eyes of online banking customers across generations. In order to retain users, banks and financial sector would do well to implement additional authentication and security measures that top customer preference.
Rewarding customers changes their behavior. By providing them with more secure and user-friendly authentication alternatives, financial institutions can attract and retain a majority of customers.
Contact Us for more information on Identity Verification, Real-Time Check Verification, Credit Card Processing, or eChecks and ACH Transactions. Or take us up on our FREE Merchant Account Analysis offer. We’ll analyze your merchant account rates and let you know how to Save! If you are ready, you may be able to Switch and Save!