The Covid-19 pandemic has caused unprecedented disruption for many businesses, however, the fintech market has remained steadfast in its growth. Actually, 2022 has become the golden age for fintech IPOs. For instance, RobinHood Markets Inc debuted with one of the biggest recorded listings for a fintech company – valued at $32 billion on July 29th 2022.
With the global fintech market predicted to achieve something of lb380 billion by 2030, this boom is showing no signs of slowing.
Whilst the fintech market became one from the fastest-growing sectors in our economy, established banking institutions now finish up in hot water. If they are to truly rival new market players like Revolut or Tide, they must innovate their digital offering. Yet, despite their efforts, traditional banks are failing at the in-app experience and still can not create true differentiation within an increasingly saturated market. Instead, fintech companies continue to outperform them, providing a 'one-stop-shop' for customers’ financial needs.
So, how have fintechs rapidly gained market authority inside a typically 'closed shop' sector?
The Digital Transition
The past 18-months have triggered a rapid acceleration from the shift online. For example, digital banking has witnessed a significant increase in uptake, with 73% of British consumers now embracing e-banking offerings.
As lockdown and social distancing restrictions hindered in-person sales and services, customers increasingly considered fintech's as a more convenient and efficient way to manage their finances. This digital transition has become set to continue to change the financial services sector because the world re-evaluates traditional types of banking and also the personal finance revolution continues to gain traction.
Customer Acquisition Strategies
Amid this backdrop, fintech companies have remained at the forefront of consumers' minds and created a strong and sustained subscriber base.
Whilst traditional banks remain focused on marketing campaigns that drive individual downloads, fintechs have set themselves apart with effective user acquisition strategies, centred around a simple onboarding processes. Industry leaders have acknowledged that a streamlined register process makes it much simpler to get new users through paid channels.
As a result, fintechs continue to achieve high levels of uptake by appealing to new users using their account activation and login mechanics which require just the best information. In contrast, traditional banks have failed to acknowledge that onboarding and overloading don't need to work together. Simplicity is key here and until established banks accept this narrative, new market players continues to outperform them in the digital space.
Effective App Store Optimization
Another contributor to the prosperity of fintechs lies in their App Store Optimization strategy which remains the main thing on the agenda. Actually, for Tide, the UK's leading business financial platform, ASO and Apple Search Ad strategies proved to be crucial in driving new business account signups.
ConsultMyApp worked strategically with Tide to enhance all elements of ASO, whilst ensuring it had been fully synchronized with their Apple Search Ad campaigns. This led to Tide's organic install volumes rising by 140 per cent over just three months, demonstrating how valuable these tactics could be.
Customer Retention Strategies
Fintechs also have acknowledged the value in creating a comprehensive user retention strategy. These apps prioritise the user experience to remain competitive and retain customers. They ensure that in the initial moment a person logs in to the app, their experience is slick and convenient – including communication pathways. These new market players are incredibly self-aware when it comes to their communication strategy – understanding how much communication is too much.
Findings claim that push notifications can in fact double the 30, 60 and 90-day retention of consumers, however they should be handled with caution. If executed poorly, push notifications can become intrusive and force users to abandon the app altogether. Yet, fintechs seem to be obtaining the balance right – individuals right people in the proper time and with the right information.
Fintech companies are currently a lot ahead of established banking institutions with regards to producing personalised content. To utilise in-app and external data, fintechs have been in a position to adapt and innovate the user experience based on specific preferences and interests. By pairing app and message personalisation with dynamic content, fintechs can connect with users propelling them into a different league with regards to customer engagement.
Looking Ahead
The fintech market has accelerated from strength to strength in the last 1 . 5 years and, with investment in to the market on an upward trajectory, this sector is just set to shatter more records.