Recent economic pressures have shrunk the American middle class, and put pressure on the customer base of most financial services providers. Technology provides an opportunity for companies to build profitable customers by helping individuals set goals, manage their money, and build wealth, according to Mercator Advisory Group’s research report, The Six Million Dollar Customer: Using Technology to Build a Profitable Customer Base.
Banks, credit unions, and other financial services providers have tried to build success by focusing on narrow niches such as the ultra-wealthy, mass affluent, or even the unbanked and underserved. This niche thinking is costing them increased profitability in the long run because it does not recognize the ways in which they help customers build wealth and thus become more profitable customers. Combining a life-cycle approach with new technology can build a portfolio of customers who each have a profitable personal portfolio.
“Financial services is one of the few sectors that actually has the power to build the kind of customers that it wants, but it requires rethinking the approach to the delivery of those services,” commented Ben Jackson, Director, Prepaid Advisory Service and author of the report.
This research report contains 33 pages and 16 exhibits.
Companies mentioned in this report include: American Express, Bank of America, Betterment, Citigroup, Digit, FIS, Mint, On Budget, Simple, SmartyPig, Square, and Wealthfront.
Members of Mercator Advisory Group’s Prepaid Advisory Service have access to these reports as well as the upcoming research for the year ahead, presentations, analyst access, and other membership benefits.