How to achieve ‘top-of-wallet’ status in the digital payments age
“Top of wallet” is a coveted position for issuers. It means cardholders choose to use one of their bank cards as their go-to payment method—showing loyalty to it for reasons varying from rewards to personalized promotions. When a card has top-of-wallet status, it means that cardholder prefers it for their day-to-day transactions, rewarding the issuer with significant lifetime value.
But with more payment options available to consumers than ever—and not always tied to a card—becoming the go-to payment option is harder than ever.
As we head into the busy holiday sales season, issuers are wise to consider how they can maintain—or even win—the coveted top-of-wallet position with consumers.
Here are three key ways:
1. Reduce cardholder friction
Making sure payment cards are hassle-free to use—ensuring there’s no “friction”—is pivotal to customers using them regularly.
At checkout, for example, making sure good-standing cardholders are approved and not falsely declined is one important way to ensure your card stays top-of-wallet. Research by Javelin found that 39% of cardholders will abandon a card after a decline, and 25% will move a declined card to “back of wallet.”
Preventing false declines entails making sure that only high-quality data is informing fraud-detection models–so they don’t lead merchants to needlessly reject cards that should be accepted. Collaborative tools like Ethoca Alerts also allow issuers to notify merchants in real time when a cardholder disputes a transaction, helping them more quickly determine the reason for the dispute—and, in turn, improving the accuracy of the data that helps inform card authorization and approval.
Post-purchase, issuers can also reduce friction by ensuring cardholders have clear transactions details in their banking app—reducing the odds they mistakenly dispute legitimate transactions they don’t recognize. A recent Ethoca research report found that 80% of merchants think digital receipts help reduce dispute and chargeback rates.
2. Improve cardholders’ digital experience
Consumers increasingly desire features that will give them more insight and control over their digital banking—and will gravitate toward banks that provide those capabilities. We can assume they will also favor the card that provides them what they want. So, what do they want?
The Ethoca report found that 61% of the most tech-savvy consumers would switch (or consider switching) banks that offer subscription controls, such as the ability to pause or cancel subscriptions through their digital banking app, while 58% would switch for the ability to initiate product returns through their app.
As issuers look to improve their digital experience, they should focus on what features consumers value most and make sure any features are easy to use—as the report notes that 75% of consumers won’t use tools and features that aren’t intuitive.
3. Provide the type of support cardholders want
Ease of interaction with an issuer and the quality of customer support are other big factors that consumers consider when choosing a payment card. Increasingly, consumers seek support through digital channels and prefer being able to “self-serve”—finding answers to their own questions or resolving issues without needing to contact a live representative.
This is a positive trend for issuers, because research from Harvard Business Review found that every live service interaction with a customer can cost companies upwards of $10, whereas self-serve tools cost them “pennies” per interaction. That said, consumers still expect the ability to contact an issuer through multiple channels and a well-rounded customer experience—which also needs to be seamless.
Providing more detailed purchase information—like itemized receipts and clear merchant names and logos—in consumers’ digital banking app can help cardholders answer questions and resolve any purchase confusion by themselves, without needing to contact customer support. Making these details easy to find and accessible, such as within the digital banking app they use to check their transaction history, is critical to ensuring they’re used and valued by cardholders.
A forward-looking approach
Issuers can no longer assume that cardholders who’ve been loyal in the past will remain so into the future. They must earn top-of-wallet status by engaging consumers with a digital banking experience that offers the features they want most.
Tools like Ethoca Alerts and Ethoca Consumer Clarity enable issuers to provide the details, insight and control that make for a friction-free and rewarding cardholder user experience—both within the digital banking apps customers use every day and across multiple channels. In addition to providing the experience today’s cardholders want, these tools help reduce disputes and chargebacks that hurt issuers’ bottom line.
