The Halo Effect: Banking's Biggest Breakthrough
There is a banking product that single-handedly can define the interface between you and your customers. A true force multiplier, a platform so powerful that your customers respond more favorably to all your products and services simply because it is there. A literal halo that extends around your community financial institution and beyond.
Rewards make everything better.
This is not flashy marketing copy, it’s a data-driven conclusion.
In the summer of 2020, the Buzz Points team surveyed over 3,000 cardholders from twenty-four partner financial institutions, ranging from $20 million to $18 billion in total assets. The respondents were a near-even blend of enrolled in the Buzz Points rewards program (enrollees), and unenrolled (non-enrollees).
The goal? Learn how the (then nascent) COVID-19 Pandemic was affecting consumer behavior, as well as gauging the positivity of each institution’s COVID-19 response and product offerings.
A very interesting effect emerged from the data – across the board, respondents rated their bank and credit unions higher if they were enrolled in the rewards program, versus their non-enrolled counterparts
This “Halo Effect” occurred independently of financial institution type (bank or credit union), total assets (millions versus billions), or even if the product or service was tangentially tied to rewards.
We’ve broken our findings down to four distinct categories:
#1: Loyalty - Rewards enrollees are more likely to utilize a single
When asked “how many financial institutions do you use,” 34% of enrolled respondents reporting banking with a single financial institution, compared to 21% of the non-enrollee segment. Non-enrolled cardholders were significantly more likely to report using three or more financial institutions (42%) compared to enrolled cardholders (33%).
#2: COVID-19 Response - Rewards enrollees were more likely to
respond positively to their FI's handling of the pandemic.
The impetus for the cardholder survey, the COVID-19 Pandemic required swift action not covered by most financial institutions' contingency planning. The Buzz Points team sought to learn more about changes in cardholder social, travel, and spending habits, and also asked about the quality of the financial institution's pandemic response in five key areas: Communication, Tone of Marketing/Advertising, Quality of Assistance Programs, Ease of Assistance Programs, and Availability of Service Representatives.
#3: Banking Products - Rewards enrollees were more favorable to
their FI's banking products across the board.
The Buzz Points team received helpful input from financial institution partners when configuring the survey, and a recurring point of curiosity was cardholders opinions and/or knowledge around different products the institutions offered. Survey participants were asked if certain products were exceptional, same as competitors, or needed improvement.
#4: Quality of Services - Rewards enrollees are significantly more
satisfied with the service at their financial institution.
The most surprising (and delighting) finding from the survey analysis is the effect that rewards have on the perceived quality of services. We asked survey participants about the availability of service representatives, overall customer service, in-branch service and locations, and perceived support of local businesses and the community as a whole.
To see all of the data for yourself, download 'Align and Shine' today!