Transforming Declined Leads into Revenue

Creating a declines program and evolving it into a marketplace by connecting with an ecosystem of third-party products can bring exponential benefits to FIs. This whitepaper explores the critical considerations for implementing a declines marketplace, including enhancing operational efficiency, delivering exceptional consumer experiences, managing reputational and regulatory risks, and securing sustainable financial benefits.

To maximize revenue yield, it is crucial for FIs to offer a diverse array of products that cater to the specific needs of declined consumers, providing them with various options to fit their individual and unique needs. Relying on a single provider and an additional source of capital is unreliable given current macro trends in underwriting and consumer credit stability. Based on our experience, a successful declines marketplace can drive up to four times the approval rate by connecting consumers with products that span the entire credit spectrum, from subprime to prime. This approach has enabled us to achieve the widest consumer credit coverage in the industry, allowing more consumers to be matched with financial products through a financial institution’s site.

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Integrating a waterfall declines experience is an ideal solution, and including pre-qualified or pre-approved offers of credit is even more powerful. While some consumers might qualify for a 3rd-party lending option, others might not, requiring a secondary alternative credit solution. By matching declined consumers with the right third-party products, FIs can dramatically enhance customer satisfaction, improve lifetime value (LTV), and monetization

Clear insights into performance drivers and knowing which levers to pull to optimize performance when the market shifts are crucial to a successful declines program. Changes in approval rates, marketing spend, APRs, and the macroeconomic environment all impact decline programs and must be addressed through yield optimization efforts. Data analytics and reporting capabilities are typically what set a declines program apart, as the program needs to be constantly monitored and fine-tuned to maximize revenue yield and ROI.

When presenting a marketplace of offers to declined consumers, it is vital that these offers and brands align with the FIs own brand integrity. Consumers initially approached the FI due to brand trust. Ensuring that the alternative offers are relevant, high quality, and trustworthy preserves this trust, turning a potential negative experience into a positive brand reinforcement.

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Navigating the regulatory landscape is a complex but crucial aspect of implementing a declines marketplace. Ensuring that all aspects of the declines program operate within legal boundaries protects the FI from potential risks and enhances its reputation for reliability and trustworthiness.

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FIs must have mechanisms in place to maintain control over the brands and products presented to their declined consumers to effectively manage reputation and compliance risks. These mechanisms should approve, govern, and track the journey of declined leads in a timely and user-friendly manner, including robust reporting and escalation workflows.

Ensuring a seamless UX is essential for maintaining consumer engagement and trust. By utilizing white label APIs, SDKs, and other embedded integration methods, FIs can create a cohesive and intuitive user experience that aligns with the rest of the user journey. A native UX that is easy to navigate helps keep consumers within the FI’s ecosystem, reducing the chance of cart abandonment.

Sustained and consistent consumer engagement is vital for the long-term success of a declines program. Modern-day consumers can be fickle, and engaging them often requires an omnichannel marketing strategy. Adopting a lifecycle marketing program that activates a diverse array of channels—such as targeted email campaigns, in-app interactions, discovery feeds, and social media—can greatly reinforce consumer engagement with the FI’s ecosystem, maintaining consumer interest and loyalty over time.

Key to a Successful Financial Marketplace.

Financial product providers are realizing that traditional marketing channels are becoming too costly and less effective. To adapt, they need to expand their acquisition strategies to include financial marketplaces. Marketplaces offer a more diverse and cost-effective way to reach potential customers, making them an essential component of any modern acquisition strategy.

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The shift towards more content and data-driven financial marketplaces represents a significant change in how financial products are marketed and used. By leveraging available consumer data enhanced with AI technologies, marketplace users can greatly improve their consumer engagement and monetization strategies through better product matching and personalized content that is both creative and informative.

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Ultimately, the success of a marketplace hinges on several crucial factors, as detailed in this whitepaper. It’s important to understand that marketplaces are not just aggregators or affiliate programs. To be sustainable, they must be seen by consumers as the destination for their daily financial and social lives.

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