Rewarding Customer Loyalty: A Financial Institution's Path to Retention Success
The Challenge
A financial institution recognized the importance of retaining its current customer base and sought to achieve this by offering a best-in-class rewards credit card. To design an effective rewards program, they needed to understand what would encourage customers to spend more on their cards.
The Approach
Numerious conducted a conjoint study to measure the relative likelihood that different combinations of rewards would drive increased spending. The results were then fed into a simulator tool, allowing the institution to balance rewards offerings with retention goals and cost considerations.
The Impact
This data-driven approach enabled the financial institution to revise their rewards program so that existing customers used their cards more frequently and new customers were attracted to sign up without breaking the bank in terms of payouts.
By optimizing their rewards offering, the institution successfully fostered customer loyalty and strengthened its competitive position.