Chatbots deserve all the fuss and, in 2018, you can expect more and more marketers to talk about their Messenger subscribers with the same seriousness as their email lists. The benefits are numerous but, in today’s competitive banking environment, adding dynamism to digital lending and improving loan conversion rates is a top priority. Here are a few of the different ways chatbots can improve your loan conversion rate going into 2018.
Millennials are there
As of 2018, nearly all of your potential customers expect the lending process to be entirely digital. According to the PwC report, Understanding Today’s Empowered Borrower, three out of four demographic segments want each stage of the lending process to be online. This is especially true of millennials but, more surprisingly, it is also true of everybody under the age of 73. Meanwhile, the most common messaging apps, like Facebook Messenger, boast over 1B users. In short, banks and lenders that don’t take advantage of messaging apps are missing out on a huge, dynamic marketing opportunity that bridges nearly every customer segment.
As fintech expands, there is a huge opportunity to deploy tools that meet the rising expectations of customers – and the banks and lenders that get there first will get the first-mover advantage. Potential buyers know all the old digital marketing tricks – banner ads, pay-per-click, and rate calculators – and routinely tune them out. As a result, much of the lending industry is still driven by referrals. Chatbots give banks and lenders the opportunity to branch out with a new marketing tactic that’s conversational and personalized at scale – exactly what yesterday’s digital marketing tactics lack.
A chatbot can give lenders the crucial information they want, not just clicks and bounce rates in a vacuum, but online behavior tied to specific leads. With chatbots, digital marketing would no longer be about improving website statistics and lead generation side by side, but merging the two. Lenders would know who landed on the website, what they clicked on, what information they gave, and when they left, not to mention an opening to continue the conversation later.
The window that lenders have to find, nurture, and convert customers is painfully short, typically lasting 3-6 months – and once it is over, lenders usually need to start the process over from scratch. Chatbots, by their very nature, can speed up the loan conversion rate by turning the sales process from a slow process of clicks and emails to a fast, dynamic conversation that reaps unprecedented amounts of information in minutes, including, most crucially, the lead’s true level of buyer intent.
That said, successful digital marketing is not just about generating leads, it is about closing them, and early banking pioneers in chatbots have chopped weeks off the back-and-forth it takes to reach the approval stage. As an example, lenders are usually required to wait a certain amount of time after providing a client an estimate before they can follow up about moving forward. Rather than sending estimates through the mail, a chatbot could send it straight to their inbox, removing days from the approval process. According to PwC, speed is a top consideration factor when borrowers rate lenders and chatbots could give lenders a crucial advantage.
Banks that adopt chatbots early will be able to take advantage of advancements as the technology progresses. The sky is the limit. Paired with the data that banks already have and additional technologies, chatbots will be able to apply customer insights and advanced analytics, all powered by artificial intelligence and machine learning, to better understand customers. Loan applications will auto-update, lenders and customers will save time, and lenders will establish better brands as best-in-class service providers. As millennials arrive as the largest group of homebuyers, the lenders that build up their chatbot savvy first will be there waiting for them.