Attract, Upsell, Retain—And Prosper: Overcoming Obstacles to Lasting Customer Loyalty
Customers expect tailored products that evolve with them, and those who deliver will win. Tech-savvy younger generations are taking the reins of businesses, economies, and governments.
Your best customers may know you and even trust you, but for lasting success, they need to expand their relationships with you.
Yet many financial institutions struggle to maximize customer lifetime value. They attract new account holders but fail to convert them into loyal, engaged customers. Too often, these accounts go inactive or close altogether—largely because banks fail to properly rely on a trusted core and solutions partner to fully understand customer needs and drive meaningful engagement.
The stakes are high.
Customer attrition in banking averages around 15%, but within the first three to six months of account opening, churn can spike to 200%.[1] Alarmingly, 56% of departing customers say their decision could have been reversed—highlighting the urgent need for seamless onboarding and tailored engagement strategies.[2] Demographics make the issue even more pressing.
A 2023 survey found that 73% of Gen Z (18-26) would switch banks for a better digital experience, up 13 percentage points from the previous year. Millennials (27-43) show similar trends.[3]
The Path to Loyalty: A Customer-Centric Approach
Winning financial institutions don’t just attract customers—they retain and grow with them by leveraging tools like AI, advanced analytics, embedded finance, modern payments systems, wealth management components that suit today’s markets and many others. With a company like Temenos, banks can build profitable longer-term relationships while:
- Slashing onboarding times by up to 57%[4]
- Boosting cross-sell rates—where industry leaders hit 80% vs. a 28% average[5]
- Delivering hyper-personalized, omnichannel experiences that customers expect
Innovation must cover every touchpoint.Despite the rise of digital banking, 65% of Gen Z still prefer opening accounts in person, compared to 58% across other age groups.[6] The takeaway? Banks need to provide seamless experiences across all channels, digital and physical.
And with $84.4 trillion set to transfer from Baby Boomers to younger generations over the next two decades, institutions that fail to modernize will struggle to attract the next wave of wealth holders.[7]
Barriers to Growth: Why Banks Struggle to
Compete
Legacy systems, data silos, and fragmented customer engagement prevent many institutions from delivering the tailored experiences consumers demand today. Common roadblocks include:
- Disjointed Data: Siloed systems (i.e., disconnected core banking, CRM, payments, etc.) prevent a 360-degree view of the customer.
- Lack of Personalization: 74% of customers expect personalized banking, yet only 22% feel their bank truly understands their needs.[8]
- Slow Product Innovation: Long development cycles allow competitors to launch new offerings faster.
- Rigid Pricing Models: Static, outdated pricing fails to reflect real-time market conditions and customer behavior.
- Fragmented Customer Journeys: Inconsistent experiences across mobile, web, and branch channels erode trust and engagement.
Contemporary Solutions for Contemporary Banking
Banks that integrate cloud-native solutions with a customer-centric focus can break down silos, anticipate customer needs, and deliver:
- Real-time personalization that strengthens relationships and increases conversions
- Faster, more agile product launches that keep pace with customer expectations
- AI-powered pricing strategies that adapt to market conditions in real time
- Seamless, omnichannel experiences that boost engagement across all touchpoints
The results can be noteworthy: Temenos clients have seen up to a 57% increase in cross-sell and upsell rates by improving their customer experiences.[9]
The Future Belongs to Customer-Centric Banks
Banks that cling to outdated methods—like mass-mailing credit card offers—risk appearing out of touch. Customers expect tailored products that evolve with them, and those who deliver will win.
Tech-savvy younger generations are taking the reins of businesses, economies, and governments. They will bank with institutions that invest in understanding and serving them—not just today, but for years to come.
Transformation starts now. Are you ready? Contact Temenos to get started.
SOURCE: [1] https://www.fiworks.com/resources/statistics [2]: Medium.com [3]: BAI Poll [4]: Temenos Customer Research [5]: Temenos Customer Research [6]: Harris Poll February 2024 [7]: Newsweek [8]: Harris Poll [9]: Temenos Customer Research
Elevated Banking Experiences
Attract new customers, grow your revenue, and ensure customer loyalty with Temenos’ innovative banking solutions.