This article is part of Insights on the fly, a series where I explore new research from the Flybits data science team. We analyze millions of interactions between customers and their banks over our platform. The goal? To help you understand what makes people tick, so you can create customer experiences that benefit them, and your business. Follow me to stay updated on the latest.
I don’t respond to marketing offers.
Maybe I’ve been in the marketing game for too long. I’ve become impervious to the gilded promises of marketers looking to juice those sweet, sweet conversion rates. Maybe I just know how the sausage gets made.
With one exception.
I am a sucker for a food offer. It doesn’t even have to be a good food offer, either. As a kid, when I learned that McDonald’s had a two-for-one apple pie deal, I was all over it. And I didn’t even like McDonald’s.
Not much has changed since then. You should see my Uber Eats order history.
Anyways… You’ll understand why I’m talking about this soon enough.
For now, let’s move on to the topic at hand, and that’s what marketing offers your customers love the most.
All financial institutions use marketing offers. Most times, they use them to nudge customers into doing something by making it mutually beneficial.
Other times, they use offers to reward customers for their loyalty.
Offers are an essential part of customer experience. When they’re done well, you can make customers feel like they matter.
Which is important, because they do.
After combing through data from interactions across seven million end customers over the Flybits platform, we’ve uncovered the top banking offers used via web and mobile.
Plus, we’ve broken down how they’re deployed.
Top offers used by banks and credit unions
Banks love passing out discounts to their customers. In fact, of all banking offers deployed over our platform, 29% qualify as discounts.
What do we mean by discounts, exactly?
Typically, banks use discounts to promote card use. In other words, use a specific bank’s credit card, get 10% off your next lunch order at a participating restaurant.
You can apply discounts to events, like an upcoming concert, football game, convention, and so on. All the end user needs to do is snag a promotion code and input it upon purchase.
Banks also use discounts to reward customers for loyalty, like flipping someone who routinely uses your mobile app cash off their next purchase of a product.
2) Cash back
Cash back offers are often used to incentivize customers to open up a new banking account.
These will be familiar.
Think: $300 for opening up a student savings account, or: $500 for opening up an investment account.
They’re also used to promote spending on a bank’s credit card, so earn a percentage of what you spend (with conditions) and have it applied as an annual fee rebate.
Cash back accounts for 21% of all offers delivered over our platform.
3) Buy one, get one... (BOGO)
Predictably, BOGO offers also get a fair bit of screen time.
These often involve food, like buy one sub sandwich and get a soda for free (with the use of a bank’s card).
As with discounts, BOGO offers promote card stickiness and loyalty.
They make up 17% of all offers delivered over our platform.
*Is your financial institution prepped for the future? Download this free copy of our latest report, and find out what some of the leading minds in banking are saying about the future of financial services.
4) Random rewards
Random rewards is our hold-all miscellaneous category.
It includes everything from commemorative coins, AKA “rounds” to two-buck coffees every Monday at your favorite local cafe (when you pay with your bank’s card).
Some institutions even let customers stream bank-hosted events from their digital devices, like awards shows. Others include rewards for your birthday, account anniversary, hitting savings goal milestones, etc.
Rewards like these make up 13% of all offers, and they’re primarily used to increase loyalty and improve customer experience.
Prizes make up 12% of offers.
Most of them are tagged onto discounts, encouraging customers to visit a booth at an event and submit their information for a draw (grand prizes range anywhere from $1,000 – $5,000).
Several banks also invited customers to branch opening parties. These were delivered via push and included a prize draw for all in attendance.
In all cases, these offers encouraged attendance at in-person events, often as a kind of sweetener to a base discount offer.
Obviously, given what’s going on in the world today, we’ll see a reduction in these kinds of offers, as they’re replaced with ones that are more consistent with the times.
6) E-gift cards
E-gift (and gift) cards didn’t get as much love as I was expecting. In total, banks deploy them about 4% of the time.
In one instance, a bank partnered up with a digital wallet app and pushed a $10 dining e-gift card via its mobile app. The card was conditional on downloading the wallet app and inputting the appropriate promo code.
Some institutions will include onboarding quizzes to make sure the user understands card or account benefits. They’ll toss a $5 e-gift card your way for answering questions correctly.
These offers were all used to reward loyalty.
7) Free workshops and advice
If you haven’t been counting this whole time, free workshops and advice cover about 4% of banking offers.
These include budgeting seminars hosted at a branch or free advice from an investment expert.
They’re used to get people into branches and provide targeted assistance to customers who might be struggling with their finances.
Again, with everything shifting to digital, we’ll see these kinds of offers evolve.
So, which offer performs best?
Now, back to my McDonald’s talk from way above.
Here’s the thing.
You’ve probably noticed that food figures prominently in the world of banking offers.
We saw meal discounts and food-related BOGO offers that increased card stickiness.
Food is, in the grand scheme of things, a pretty cost-effective thing to discount. Plus, it’s something people always need.
Food is primal.
Nobody says no to free (or heavily discounted) food, because—guess what?
You’ve always got to eat.
It should come as no surprise, then, to learn that offers containing food are the biggest winners, with an average engagement rate of 13%. The highest performing food offer I saw received an engagement rate of 18.3%.
That means when a customer gets a discount push for their next meal via mobile, chances are they’re licking their chops.
Chances are they’re happy to be your customer.
Obviously there are a ton of variables that can influence offer engagement, like channel, graphics, copy, offer value, etc. In this series, we’re going to get into the nitty gritty of all this stuff. Trust me.
But all things being equal, humans prefer offers that get them fed over all others.
So, next time you’re talking offer strategy with your marketing team or looking at building partnerships with local businesses, remember: most of us, i.e. your customers, think with our stomachs.
All that said, I really, really need to grab a bite to eat.