By Aliaksei Ustauski, Sales Strategy Director, EMEA & LATAM, AppsFlyer
Whilst the financial landscape in Europe has matured, it has also fragmented. Traditional banks, neobanks, and investment platforms remain siloed in their strategies. Yet, the biggest wins in the coming year will be from those in the industry who can step outside of their lanes and borrow from their neighbours.
New research reveals three dominant user acquisition strategies that are tuned for different conditions. Yet, it also uncovers missed opportunities that could boost retention, acquisition, and long-term value for all.
The retention experts
Traditional banks are experts in customer retention, with up to 85% of their conversions coming from retargeting existing customers. Their primary strategy revolves around converting web and branch customers to mobile through deeplink-enabled customer journeys.
This approach delivers impressive results. Traditional bank apps achieve retention rates 1.5 to 2 times higher than neobanks at the 30-day mark. With 45% of their app installs coming from owned media, they have built sustainable acquisition models around their existing ecosystems.
However, this strength masks a critical weakness. Traditional banks show zero growth in new user acquisition, whether organic or paid. This reflects both a gap in user acquisition capability and the reality that as their existing customer base has already migrated to app, the pool of first-time app users has shrunk.
The diversification masters
Neobanks have seemingly cracked the code on new user acquisition. Their success stems from aggressive media mix experimentation. While traditional banks rely heavily on owned media (45% of installs), neobanks spread their bets more widely with 35% owned media and significant investment in ad networks, DSPs, and platforms like TikTok. This diversified approach helps them capture the younger demographic that traditional banks struggle to reach.
Yet, neobanks harbour a surprising blind spot. Retargeting represents only 3% to 4% of their total conversions. This represents a missed opportunity to improve unit economics through better retention and cross-selling strategies.
The volume hunters
Investment apps operate in an entirely different universe, with 75% or more of their installs coming from paid acquisition campaigns. Their performance correlates directly with market sentiment, particularly around cryptocurrency prices. This creates volatility but provides the potential for massive scaling opportunities.
Investment apps have embraced a high-volume, low-retention model by necessity. Day-1 retention averages just 19%, drops to 8% by day 7 and a mere 4% by day 30. Only a small percentage of their conversions come from retargeting, as their business models depend on constantly attracting fresh users.
What is interest is that the segment is dominated by international players. Over 85% of non-organic installs in retail trading and investment apps across the UK, Germany, and France come from companies based in Australia, China, Israel, or Eastern Europe. This stands in sharp contrast to nearly every other finance sub-vertical, where local Western European companies still hold the upper hand.
Blind spots
Each segment’s specialised approach, while effective within its niche, creates blind spots that competitors are exploiting.
Neobanks’ low retargeting rate
Despite building substantial user bases through superior acquisition strategies, neobanks are essentially leaving money on the table. Traditional banks demonstrate that retargeting rates of 55% to 85% are achievable in financial services. Yet, neobanks’ low retargeting rate suggests they’re treating customers as one-time acquisitions rather than relationships to develop over time. Neobanks need to translate their acquisition sophistication into retention excellence.
The limited media mix of traditional banks
While neobanks prove that diversified media strategies work for attracting younger demographics, traditional banks remain locked into narrow acquisition channels. Their 45% owned media dependence limits their ability to expand beyond their current base.
The branch closure trend isn’t helping, either. As physical touchpoints disappear, traditional banks need to find new ways to attract first-time customers. They need to evolve their media strategies to capture users who discover financial services through digital-first journeys.
The assumption that high churn is inevitable
Investment apps’ acceptance of 4% day-30 retention rates reflects an assumption that high churn is inevitable. However, other financial service segments achieve retention rates multiple times higher, suggesting room for improvement even in volatile conditions.
During bear markets, when user acquisition becomes more expensive and market sentiment dampens organic interest, better retention strategies could mean the difference between surviving downturns and scaling back operations significantly.
Opportunities exist
Specialisation may have worked in the past, but the next generation of winners will be those who learn from adjacent strategies. Whether that means neobanks that already offer investment products putting more focus on them to compete with international platforms, or traditional banks scaling new user growth through diversified media, opportunities exist.
The most successful finance apps of tomorrow will be those that both perfect their product offering and learn to adopt techniques not just from other financial segments, but ecommerce, subscription services, and gaming apps too. They need to remember that the most effective strategies aren’t always invented in-house, a pattern increasingly visible across our European News Coverage.
