Customer Acquisition Strategies for Financial Institutions


It’s likely you’ve been tasked with growing the number of customers or members at your financial institution.

It is no easy task and developing customer acquisition strategies comes with a lot of barriers. 

But understanding more about the formula to acquire new members or customers in your market will help you develop unique strategies to attack the market and grow your customer base.

Challenges of Acquiring New Banking Customers

The total market for potential banking customers is capped. 

Outside of signing up students who have never had a bank account before, working with parents to create savings accounts for their children, or other random happenings. 

Unfortunately, new banking customers do not grow on trees.

As people age out of accounts, you’ll have an equally steady flow of new accounts so for many financial institutions, the customer base remains fairly static.

As a result, customer acquisition strategies for banks and credit unions focus on finding customers who have relationships with other financial institutions. 

However, capturing market share from other banks and credit unions in your region can be very challenging.

That’s because the likelihood of someone switching their primary financial institution (PFI) is extremely low. In fact, only 11% of banking customers have made that change in the past year.

11% of banking customers have changed FIs in the past year (1)

Therefore, those who set up their core deposit accounts with a bank or credit union create a lot of leeways for the financial institution to retain that customer for a long time. 

The high barriers to switching are based on the effort required to change direct deposits, bank account withdrawal accounts for bill payments/credit cards, and all the other key tasks when changing a PFI.

Why Banking Customers Switch FIs

When a customer decides to change a PFI, it is likely driven by a major or life event. 

Some of these major events which drive a change in primary financial institutions include:

  • Moving out of the region
  • Getting married and joining accounts
  • Switching jobs
  • Merger and acquisition of another bank or credit union

Other drivers that force someone to switch PFIs are less driven by life events and more by poor customer experiences with the bank or credit union. 

It could be a major service issue. It could be years of frustration with their mobile banking app. 

It could be the great experience they had with another bank when they opened a mortgage, and the customer decided to shift accounts.

And despite only between 11% and 17% of people switching banks in the past year, 37% report they are more likely to switch now than they were in the past. 

Now is the time to capitalize on that.

37% of banking customers are more likely to switch FIs now than they were in the past

Customer Acquisition Metrics for Financial Institutions

As a market research firm that conducts studies with financial institutions across the country, we know a thing or two about strategies to grow customers at a bank or credit union.

When we design surveys with our clients, two of the most common questions we recommend in our market surveys are net promoter score (NPS) and likelihood to switch (LTS).

Metric #1: Calculating NPS

NPS is one of the most common benchmarks in market research

Measuring a bank or credit union’s NPS involves asking respondents how likely they would recommend their PFI to a friend or family member on a 0-10 scale.

Then, it relies on a number of different factors about your customer base. 

  • Promoters (loyal customers) rate your FI a 9-10. 
  • Passives (those who can be swayed) rate your FI a 7-8. 
  • Detractors (those who are not loyal and unhappy) are those who rate your PFI a 0-6. 

When calculating NPS, market researchers take the difference between promoters and detractors. If you have 65% promoters, 20% passives, and 15% detractors, your PFI NPS would be calculated as +50. 

If you have 20% promoters, 50% passives, and 30% detractors, your PFI NPS would be -10.

calculating net promoter score - drive research

Metric #2: Likelihood to switch (LTS)

Secondly, we also like to ask about the likelihood of switching (LTS) your PFI in the next 12 months using a 5-point Likert scale. 

A “5” indicates very likely to switch, and a “1” indicates not at all likely to switch.

These are 2 excellent metrics to include in all of the market and banking brand equity surveys you conduct for your financial institution. The real magic happens when you combine the 2 metrics in a matrix. 

No analysis is more insightful to help you understand what percentage of the market can be attained through customer acquisition.

Analyzing the Correlation Between the Metrics

Drive Research can help recommend a scope for a market survey to help your bank or credit union obtain this information (among other data).

In most markets, we recommend anywhere from n400 to n3000 responses to your survey to allow our banking market research firm to dive deep into the analysis. 

Once you have acquired these 2 data points, you can begin to segment the market to understand the makeup. 

Here is the breakdown you want to analyze using 4 distinct segments:

  • High NPS (ratings of 9-10) and low likelihood to switch (LTS) (1-3)
  • High NPS (ratings of 9-10) and high likelihood to switch (LTS) (4-5)
  • Low NPS (ratings of 0-8) and low likelihood to switch (LTS) (1-3)
  • Low NPS (ratings of 0-8) and high likelihood to switch (LTS) (4-5)

Next, segment the customer groups into a matrix. Doing so lends a wealth of insights into your market.

For example, here is how our market research company would group customers into 4 segments based on the criteria above.

  • High NPS (ratings of 9-10) and low likelihood to switch (LTS) (1-3) = Committed Clients
  • High NPS (ratings of 9-10) and high likelihood to switch (LTS) (4-5) = Shifty Shoppers
  • Low NPS (ratings of 0-8) and low likelihood to switch (LTS) (1-3) = Procrastinating Patrons
  • Low NPS (ratings of 0-8) and high likelihood to switch (LTS) (4-5) = Cranky Customers

Drive Research Matrix

1. Cranky Customers

These are the respondents who absolutely hate their current PFI and are already in the process or soon to be in the process of making a switch.

These are the respondents who are ripe to capture in your marketing outreach, but the window is short.

They are unhappy and ready to mingle with a new financial institution.

They are the most attractive audience to acquire because, unlike the shifty shoppers, they may stick around for a while as a committed customer or procrastinate patron for a while.

This group is the most attractive for customer acquisition.

2. Shifty Shoppers

These are respondents who fully embrace their label of shopper.

They are pleased with their current PFI, but it doesn't take much for them to switch to the new, shinest, prettiest financial institution.

They are easily swayed by better rates, new rewards, new products, better service, and will rotate their PFIs on a whim. They are effortless to influence with marketing.

This group is the second most attractive for customer acquisition.

3. Procrastinating Patrons

These are the impassive, do-nothing customers who are not 100% happy with their PFI but are not motivated to make a switch.

This is the audience when we talk about the high barriers to switching PFIs.

Getting this audience to change takes a compelling offer, switch liaisons, or some uncommon inspiration, but marketing to this audience can be an uphill battle.

This group is the third most attractive for customer acquisition.

4. Committed Clients

These are loyal customers committed to sticking with their PFI.

It's nearly impossible to influence this audience with deals, marketing, or messaging. Getting this audience to switch its PFI can often take a significant mistake or years of more minor frustrations.

Your best bet is to try to land this customer through a smaller product, credit card, or other door opener offering and slowly convert them to using you as their PFI.

This group is the least attractive for customer acquisition.

How the Segments Relate to Customer Acquisition

Most of the markets where our bank and credit union market research firm conducts these studies find the vast majority of residents in the market fall into either committed clients or procrastinating patrons.

These are also the most challenging audiences to acquire through customer acquisition for the reason(s) above.

In most markets, committed clients account for 40-60% of the market, while procrastinating patrons also account for a similar market share at 40-60%.

The most attractive segments typically account for less than 10% of the market, including cranky customers and shifty shoppers.

This speaks to the problematic nature of acquiring new customers and members in any market.

These segments (outside of committed clients) require a different marketing strategy. 

Part of the survey outreach should include many other survey questions that will help you better market to these audiences. 

Some of the suggested question topics in your market survey might consist of:

  • Awareness of financial institutions in your area (top-of-mind and aided)
  • Usage of financial institutions
  • Bank or credit union that is your primary financial institution (PFI)
    • Note: For this survey, your primary financial institution is where your paycheck is deposited or the one you use to pay your monthly bills.
  • NPS
  • LTS
  • Reason(s) for switching their PFI in the next 12 months
  • Product(s) or service(s) used at any FI
  • Most attractive benefit(s) from an FI
  • Factor(s) most important when choosing a FI for products and services
  • Demographic information to provide further profiling data:
    • Age
    • Region
    • Household income
    • Business or personal account(s) holder
    • Employment status
    • Marital status
    • Child(ren) in household


Understanding the market makeup using these 4 segments can help any bank or credit union with customer acquisition strategies.

Defining the market share of each of the 4 segments outlined will give your financial institution a competitive advantage in terms of honing in on the percentage of the audience and how to best strategize and message each audience.

Recommended Reading: Market Research Options for Banks and Credit Unions

Contact Us

Drive Research is a market research firm that partners with banks and credit unions to use data-driven decisions to assist with marketing and strategy.

These studies include market surveys, customer segmentation surveys, brand equity surveys, focus groups, in-depth interviews, and much more.

To learn more about our bank and credit union market research services, contact us today.

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Author Bio George Kuhn

George Kuhn

George is the Owner & President of Drive Research. He has consulted for hundreds of regional, national, and global organizations over the past 15 years. He is a CX-certified VoC professional with a focus on innovation and new product management.

Learn more about George, here.

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