The key for fintech start-ups to scale and grow, ET BrandEquity

By Abhishek Gupta

The Fintech revolution has disrupted the Indian financial industry with the introduction of the Unified Payments Interface (UPI). According to BlinC Insights, the Indian fintech sector, currently valued at $31 billion, is projected to grow to $84 billion by 2025, at a CAGR of 22%. In a country like India which is a mobile first market, the fintech industry is not new to this phenomenon. Between January 2019 and March 2021, India witnessed 149 crore fintech app installs, which clearly shows the huge demand for fintech apps. CleverTap’s 2022 Fintech Benchmark Report found that Fintech apps have a stickiness quotient of 22%, indicating that nearly a quarter of monthly active users (MAUs) consistently return to their fintech apps. It further provides an opportunity for mobile marketers within the fintech space to gain a detailed understanding of their customers in real-time and adapt their marketing campaigns to suit this huge group of users.

Marketers must now place special emphasis on this detailed insight rather than making universal reach the main focus of their campaigns. It is therefore important for marketers to be present where the customers are. This is where customer retention platforms and tools can step in to help craft strategies that ensure your brand stands out from the competition.

With the following three steps, banks and Fintech players can increase retention, customer activation and serve hyper-personalized communications to increase loyalty and generate revenue.

Utilize insights into the customer journey to drive personal communication-

• A Gartner survey indicated that 70% of CMOs, CSOs, and over half of CEOs see their revenue tied to existing customers. The value that banks and fintechs place on their current clientele and their capacity to generate revenue deviates significantly from their confidence in the current level of customer satisfaction. Banks must therefore actively work to retain existing clientele.
• Companies have increased conversion rates by up to 100% by leveraging personalized messaging and adapting to where customers are in their individual product/service journeys. Micro-segmenting your customer base gives businesses the opportunity to deliver valuable insights and help convert customers to positive reviews and ratings, along with reaching new audiences.
• While some customers may be new, others may be frequent users who return to explore investment options/schemes. Since each customer has a unique story and expectations for the product, marketers must be able to adapt communications to meet individual requirements.
• For example, Mobikwik leveraged the power of personalized and triggered messaging throughout the orchestration of the customer journey. They started segmenting users based on utility bill due dates and through triggered reminders helped them pay on time through the app. Furthermore, the company automated welcome campaigns to educate new users about key features and help them navigate through the app with ease. This doubles user engagement in the app and increases Mobikwik’s user retention by 20%.

Using contextualized messaging to increase customer engagement

• According to CleverTap’s Fintech Benchmark Report 2022, 95% of new fintech users complete a money transaction within the first month. This indicates that while users see value in fintech apps, it is critical to implement customized user engagement strategies to increase retention of their apps.
• One of India’s leading private sector banking and finance companies wanted to revamp its app to combine banking and payment functions, offering these services to customers of any bank. This was achieved through a combination of contextual segmentation and messaging. Providing users with demonstrable value by integrating with automation partners helped drive traffic in the right direction. Unique insight into user actions and post-purchase preferences helped create campaigns that convert. This shows in the results as this contextual approach increased in-app traffic from 1% to 25% and a 4x increase in the number of users making fixed deposits.
• A winning product always succeeds in getting customers’ attention and interest. The challenge is to keep the conversation going between app sessions and over longer periods between renewals.
• Marketers can bridge app sessions and interactions by personalizing and contextualizing their messaging to drive engagement. In customer journeys that typically span 12 months, it is important to develop customized streams of information related to the customer’s unique journey.
• For example, a customized information flow helps customers decide whether it is cost-effective to invest in collision insurance for an older vehicle by explaining the differences between insurance deductibles and what makes sense on a budget.

Adopt a “consumer-like approach” to building customer relationships-

• It’s natural to have a “consumer-like” approach when it comes to mobile marketing, as a significant proportion of fintech customers include e-commerce platforms, sole proprietorships and small businesses that are not very different from individual consumers. For example, through tailored communications, PayU India, which serves over 450,000 merchants in India with 100+ local payment methods, has been able to improve its lifecycle management. With this approach, the platform’s customer acquisition has increased fivefold, and the number of customers undertaking so-called DIY journeys to connect their accounts and complete transactions has increased by approximately 20%.

It is no coincidence that platforms that have engaged users through Hyper personalization have seen a sharp increase in user retention and engagement. These numbers are proof of the fact that it is the key to converting and winning over users. With over 20.5 billion online transactions totaling INR 36 trillion in Q2, 2022, the fintech revolution in India is clearly visible. As such, it’s important that service providers in the space take notice of the untapped potential of a hyper-personalized mobile and online experience, because one size does not fit all.