Customers have various ways to reach out to banks, but alerts are one of the few ways that financial institutions can initiate and direct conversations with their customers. However, many banks’ alert systems aren’t optimized to make those interactions count.
In her latest report, Six Alert Flaws That Banks Can Fix Today, Lea Nonninger, Digital Banking Analyst at Javelin Strategy & Research, discusses the common flaws in institutions’ alert systems and details the steps banks can take to maximize the impact of their alerts.
A Lack of Visibility
Nonninger analyzed some of the top United States banks to evaluate the types of alerts they offer and how they are presented to customers. While all the banks offered some iteration of alerts, the analysis found there was room for improvement across the board.
“One of the first things we examined is the visibility of alerts, and we found that they weren’t very prominent in the online banking experience,” Nonninger said. “It often takes a few clicks to locate them, which means customers are forced to actively search for the alert dashboard.”
Since alerts are a key way for banks to communicate with their customers, they should ideally be advertised front-and-center on an institution’s homepage. However, that is rarely the case.
In addition to the lack of prominence on online banking homepages, locating alerts during the customer journey can be complicated. The lack of direct routes to the alert center in some online banking experiences means customers must click through multiple screens to access it.
Customer Convolution
Many financial institutions don’t display alert options outside of the main alerts dashboard. While a central alerts dashboard serves as a great hub to showcase all alerts, it limits the opportunity for customers to access alert preferences during their online banking journey.
“As a customer is making a payment, it would be much more beneficial if they could view the payment alerts that are available while they’re there, or they could see the card control alerts while exploring card settings,” Nonninger said. “There is a missed opportunity to advertise alerts where they matter most to customers.”
Oftentimes, even the alert dashboards can be convoluted for customers. Banks might offer a vague overview of the types of alerts they offer, organized into categories. A financial institution might group alerts by accounts or cards, which might be clear to the bank but confusing for the average customer. This added complication creates another missed opportunity, as most customers are unlikely to take the time to review all the alerts in the dashboard and make their selections.
Proactive Alerts
Another flaw in many banks’ alert systems is that they are retrospective. While they may consider a customer’s history, they do not proactively alert users to potential issues on the horizon.
“If a customer might soon have difficulty making their next payment, or if they are about to dip into overdraft, they are not notified until it is too late,” Nonninger said. “It is a missed opportunity to take care of your customer before they get into those undesirable situations. Giving customers guidance and advice proactively though alerts can strengthen the customer relationship.”
Although online banking and mobile banking experiences are often equated, the Javelin analysis found that there were often differences in the alerts settings offered in each case. For example, most financial institutions don’t offer customers the ability to create push notifications through the online banking experience, while this option is available on mobile.
“Consumers have varying preferences, but they are increasingly mobile-first,” Nonninger said. “Users are much less likely to manage their alerts if they have to search through both the mobile banking and online banking alert dashboards to find what they’re looking for.”
Step One
Alerts should be at the forefront of the digital banking experience, as they can effectively keep customers informed and engaged. Outside of high-priority alerts like security, most alert preferences are selected and managed by customers.
There is significant opportunity for banks to build stronger relationships with their customers by making users aware of alerts and educating them on the benefits these alerts provide. However, fixing the immediate flaws in a banks’ alert system is only the first step toward an optimized program.
“Once the categories are more defined and alerts are better advertised, that will be step one in fixing the flaws in alerts,” Nonninger said. “Then banks can take their alerts to the next level by ensuring the content they are sharing is personalized, and they’re approaching their customers in the right way.”
Source
Arwen Volkov, A graduate of the University of St. Gallen in Switzerland with a degree in International Finance, Arwen specializes in sustainable finance and green investments. She began her career at an investment bank in London, where she developed financing models for environmentally friendly projects. Known for her analytical and strategic thinking skills, Arwen is a sought-after financial consultant. In her spare time, she mentors fintech startups, contributing to their growth strategies. She is also a nature enthusiast and an amateur photographer.
