How Education for Financial Products can Lower Churn
The reality of many online brokerages is that a constant stream of new clients is necessary in order to sustain profitability. But the smartest of these companies are actually spending most of their time marketing to existing clients, to stop them from churning. They understand, like you do, that it is much more profitable to keep a current customer than it is to gain a new one.
The problem is that it is not as clear-cut as just advertising to your current clients, we need to be intelligent about it. We need to figure out why they stop being our clients, only then can we figure out what actions to take. From experience, we know that the number one reason why clients stop trading is a loss of collateral. Especially for brokerages that are targeted at the lower end of the client spectrum.
The most important reason why clients are losing their collateral is a lack of sophistication in their training behavior. So a logical conclusion is to focus on education. Again, this is not as easy as it sounds.
Education programs are a dime a dozen these days but clients seem to resist entering them because of the time and effort involved. Why not take a page from educational institutions and try to make learning involved and fun?
In a university, students are rewarded for good behavior by getting good grades, by social approval from other students, teachers or parents and the end goal of the diploma. Brokerages can take this principle and apply it to their education program by involving other traders, by giving points, diplomas, public validation moments like events and awards ceremonies and other such mechanisms.
Another important thing to keep in mind is that not every student likes learning the same way; some like to learn by video, some like to learn by audio, some like to learn by text etc. Why not give your clients the flexibility to learn the way they want to?
MGL can help to craft a custom education program that will delight your colleagues and clients alike. After an initial investment of time and money, you will start to see results surpassing the ROI of most of the other channels in your marketing communication program. Go to MediaGroupLondon.com for more information.