How fintechs can do a better job with loyalty

A new report from Tillo, titled Bridging the Loyalty Gap: Consumer Insights for Fintech Engagement and Growth, should be a wake-up call for fintech. Loyalty does not get the attention it deserves today and Tillo is leading the charge to change that.

The report offers a comprehensive examination of the role rewards and incentives play in the fintech loyalty landscape. Drawing on data from a survey of 4000+ consumers, the report underscores a substantial market opportunity for fintechs to attract new users and deepen existing customer relationships through strategic rewards programs.

Central to the findings is the unparalleled appeal of gift cards as a reward across all demographics, highlighting their potential as a strategic asset for fintech companies looking to increase market share and profitability. The report reveals that a significant portion of consumers remain unengaged with fintech services, presenting an opportunity for growth through the deployment of well-crafted rewards and incentive programs.

Key insights from the report include:

  1. Market penetration and consumer engagement: The report identifies a significant untapped market within the fintech sector, with 38% of surveyed consumers yet to engage with fintech services. The leading barriers to adoption include a perceived lack of necessity, distrust, and a lack of incentive.
  2. The role of incentives in fintech adoption: Incentives are crucial in overcoming barriers to adoption. The data indicates that incentives, particularly in the form of gift cards, are highly effective in attracting new users and encouraging engagement from existing customers.
  3. Loyalty landscape: Only 32% of consumers feel a sense of loyalty towards fintech brands, with a nuanced view that suggests a significant opportunity for fintechs to deepen customer relationships. The loyalty trends vary by region and age, with the US market showing higher loyalty percentages than the UK.
  4. Consumer preferences for rewards: Gift cards emerge as the most attractive form of reward across all demographics, followed by brand discounts, premium features, and charity donations. The preference for gift cards highlights their versatility and broad appeal as a loyalty incentive.
  5. Strategies for loyalty program success: To develop a successful loyalty program, fintech companies must focus on offering strong monetary value, ease of use, quick redemption, and a variety of rewards. The report suggests that these elements are essential to boosting acquisition, engagement, and loyalty at every stage of the customer lifecycle.
  6. Optimal range of brand options: The report also finds that consumers prefer a curated selection of brand options for reward redemption, with an optimal range being between 2 to 10 brands. This preference for manageability over excessive variety points towards the importance of fintechs offering tailored, meaningful choices to their users.
  7. Regional and demographic differences: The report highlights the importance of tailoring loyalty programs to specific regional and demographic needs, noting differences in preferences and behaviors between the UK and US markets, as well as across different age groups.

The Tillo report emphasizes the critical role of rewards and incentives in enhancing fintech engagement and loyalty. By leveraging the power of desirable rewards like gift cards, fintech companies can bridge the loyalty gap, turning casual users into loyal advocates and skeptics into adopters, thereby unlocking new avenues for growth and profitability.

Download the full report here.