Fintech and Online Brands Outperform Traditional Banks in the U.S.

Digitalization remains a work in progress for retail banking brands, contributing to an average or below performance in digital marketing for more than two-thirds of brands, according to Gartner. Their inaugural report ranks the digital performance of 80 retail banking brands operating in the U.S. market.

These brands were measured across more than 1,200 data points against four critical dimensions: site experience, digital marketing, social media and digital commerce. From these findings, three brands were classified as Genius (Bank of America, Wells Fargo and Chase), 22 as Gifted, 21 as Average, 25 as Challenged and nine as Feeble.

“A majority of U.S. retail banking brands have a lot to worry about on the digital front,“ said Chris Bendtsen, principal in the Gartner for Marketers Practice. “With new tech competitors on the horizon, digital first banks eating away at their margins and constantly rising customer expectations, it's no longer good enough to deliver just basics, like online enrollment. Banks must take the next step in digital innovation to compete with fintechs and online banks.“

Fintechs and online banking brands are disrupting the existing business model by focusing their efforts on select digital strategies to outperform traditional banks. Generally, fintechs favor minimally designed websites and instead emphasize their mobile apps as primary touchpoints, both for prospects and customers.

73% of fintechs and 60% of online banks prominently display mobile app download calls-to-action on the mobile sites’ homepages. This compares to just 53% and 42% of national and regional banks, respectively. Using this type of mobile app promotion, fintechs and online banks outperform the rest of the brands for both app downloads and monthly active users.

“Challenger brands have perfected the art of using their mobile apps for more than just servicing customers,“ said Bendtsen. “To thrive in a mobile-first environment, traditional retail banks should think about expanding their mobile app product roadmaps to include prospecting capabilities and test a variety of tactics for promoting mobile app downloads to defend against challenger disruption.“