The rise of neobanks is one of the key recent trends in fintech.
According to Accenture, the number of people using UK neobanking apps grew by a factor of 2.5 in 2019 and almost reached 20 million, as opposed to 7.7 million in 2018.
How did neobanks bring about this expansion of the customer base? In our latest study we've looked at neobanks' six main web traffic channels to understand which marketing tools they use most.
Apart from neobanks proper, the study looks at two financial management apps – Bankin' and Linxo. They are analysed together with the others, since their services fall in the general banking and personal finance apps. We view their business model as an example of a new type of service that merges several existing financial structures and products.
All the neobanks selected for this study satisfy the following criteria:
European neobanks get most of their traffic from direct (52%) and organic search (32%) sources. This can indicate that digital banks prefer to promote themselves via crowd and viral marketing. This includes referral campaigns and other tools that incentivize users to endorse the product.
The overall share of social media traffic isn't significant: only 2.9%. However, social networks occupy the leading position among the traffic channels for mobile neobanking apps. They ensure over 70% of all paid app downloads. This isn't surprising: social media advertising is mostly used for promoting apps.
Apart from social media ads, neobanks tend to neglect paid marketing channels. Display ads account for less than 1% of all traffic, while contextual advertising brings in 5.7%. Judging by the number of paid keyword queries, only 6 out of the 14 banks under review actively use contextual ads. The same number use SEO.
Neobanks' target audience is 58% male and 42% female, mainly between 25 and 44 years of age, living in the EU and/or UK. These regions account for 94% of all app downloads. Gradually, neobanks have started to expand their audience. Now they are targeting not only private individuals in Europe, but also businesses, including on other continents, mostly North America. The US leads by the number of downloads outside of Europe.
1) Neobanks get most of their traffic from direct (52%) and organic search (32%) sources. This can indicate that digital banks prefer to promote themselves via crowd and viral marketing. This includes referral campaigns and other tools that incentivize users to endorse the product.
Banner and social media ads play a minor role in attracting new customers. Rather, they are used for subsequent marketing touches. Such ads describe existing products and solutions.
As for individual social media platforms, neobanks get most visitors from Facebook and Youtube (74% in total).
2) Almost all the neobanks under study show the same traffic distribution among channels, with an average deviation from the mean of +/-5%. Nevertheless, there are some exceptions:
3) Neobanks' main audience comprises millennials and zoomers – that is, tech-savvy users. Gender-wise, the distribution is rather even, with 58% of males and 42% of females. The TA's key interests are technology, finance, travel, arts, and sports.
Apart from attracting private customers, neobanks also offer their services to businesses. This is shown by the growing number of visits to their B2B pages and by the ads directed at the B2B segment.
Revolut, Monzo and N26 get most visits, with the rest lagging far behind.
As shown in the diagram below, 54.6% of neobanks’ traffic is represented by unique users. On the time scale of one year, the value increases, together with the total number of clicks.
The mean distribution of traffic by channel is as follows:
The overall picture is similar to the one resulting from the recent Alexa report on traffic sources in personal finance.
Direct website visits constitute the largest share of all traffic. We can conclude that neobanks prefer to promote themselves using crowd and viral marketing: blog tutorials, referral campaigns, and other tools that incentivize users to endorse the bank.
We have identified the top 20 keywords used by neobanks for search engine promotion. To do this, we've gathered paid search results and removed branded queries.
Interestingly, the term 'neobank' didn't make it to the top 20. It seems like digital banks prefer to use the easier-to-understand word 'bank' in their communication – and it's 'bank' that tops the list.
UK occupies the 5th spot. It's not surprising, considering that 57% of the banks in our study are based in the UK and that the population of Great Britain are very active users of digital services.
The top 20 also include keywords that describe what neobanks are: online, app, mobile; as well as references to the services being promoted - account, card, business, credit.
Email is a minor traffic source for neobanks. Bankin’ has the highest percentage: almost 8%, as opposed to 1.45% on average. For comparison: for the Russian neobank Tinkoff, emails account for 16% of the traffic to the site.
The share of social media in the overall traffic is quite small, too. For instance, Russian bank Rocketbank gets over 20% of its traffic from social networks.
The diagram shows the mean values for all neobanks and for each social network. Facebook and Youtube account for most of the traffic. Interestingly, only 6 banks out of 14 maintain presence on YouTube.
The mean values in the diagram are correct for all the neobanks except:
The diagram above shows how neobanks' display ads traffic is distributed among the most popular ad platforms.
Almost 50% of display ads are launched using Google. PopAds, Propeller ads, Dianomi, Voluum, Adf.ly, ClickBank, Adservice and others together account for 4.1%.
Interestingly, most banners use a dark color scheme. Here are a few examples:
Data for this section for the study was provided by our mobile marketing partner apptember.io and covers the period between November 2019 and January 2020.
The apps of the neobanks under study were downloaded 2.9 million times during the 90-day period.
Revolut and Monzo had the highest number of downloads.
According to a report by App Annie, fintech apps showed the highest rate of growth in terms of download numbers compared to other financial products, such as traditional banking apps, budgeting assistants, or payment utilities. The diagram shows that Monzo was downloaded twice more often in 2019 than in 2018.
Top finance apps by the year-on-year growth in download numbers in 2019
Users from 23 countries downloaded neobanking apps during the 3-month period. The top 3 countries by the number of downloads were:
Europe accounts for 94% of all downloads, while the US holds the 1st place outside Europe with 3.7%.
The diagram below shows which app was most frequently downloaded in which country.
For example, the 100% of Revolut downloads in Russia means that there were no downloads of other neobanking apps, but Revolut.
Neobanks promote their apps using the following paid tools:
The chart shows that social media is the key channel for paid app downloads. They constitute 74% for Android devices and 80% for iOS.
Most social media ads target neobanks' home countries – that is, countries where the head office is located. For instance, it's the UK for Starling Bank and France for Bankin'.
However, there's also a noticeable focus on the US. For example, Revolut targets US users in 21% of all the ads for its iOS app and 61% of the ads for the Android app. It's similar for Monzo Bank (63% and 59%, respectively) and Starling Bank (41% and 34%).
In this part of the study, we looked at neobanks' accounts on Instagram, Facebook, Twitter and Linkedin, as well as on YouTube. We analyzed the data for the period from October 2019 to January 2020.
Neobanking websites get only 2.9% of their traffic from their social network accounts. At the same time, social media accounts for over 70% of paid mobile app downloads. This shows that a correct SMM strategy can have a positive impact on the future expansion of neobanks.
Neobanks prefer to grow their social media communities organically rather than expand via paid channels. The same traffic acquisition strategy is used to attract traffic to the website.
The level of user engagement is highest on Instagram, while the number of followers grows most rapidly on Linkedin.
This indicator shows which social media platforms are prioritized by the neobanks.
Almost half of the banks under review have no presence on YouTube. Overall, the number of YouTube followers is much lower than on other social platforms, even though YouTube comes second after Facebook by traffic volume.
Social media ad campaigns mostly focus on app downloads and audience outreach. The number of followers grows organically: over half of the neobanks show a stable increase in their social follower numbers over the course of three-four months.
Average monthly growth rate
Average engagement index
Only 36% of the neobanks under review actively pursue a SEO strategy.
The leaders in terms of organic traffic are Revolut, N26, Monzo Bank, Starling Bank and Monese. These neobanks' websites have strong backlink profiles and many content-rich pages that attract search traffic for a wide variety of keywords.
Let's examine the factors that allowed Revolut, N26, Monzo Bank, Starling Bank and Monese to capture more organic traffic than their rivals.
1.Number of keyword queries
The diagram demonstrates that the leading sites rank for dozens of thousands of keywords. Thanks to this, they more frequently appear on SERPs and get more clicks.
In order to rank for a large number of keywords, one can create many pages with relevant and useful content. This constitutes the next factor.
2. Number of pages on the site
3. Backlink profile
The quality of the inbound links profile is the third factor affecting a site's rankings.
For our analysis, we used the Ahrefs Rank indicator, calculated based on the volume and quality of the backlink profile. Ahrefs Rank shows a site's position in the rating of all sites on the web, so the smaller the number, the better.
6 out of the 14 neobanks actively use contextual advertising.
By using misspelled brand queries, such as revalute, revalit etc., neobanks can attract cheap targeted traffic.
Contextual advertising accounts for 5.7% of the overall traffic to neobanks' sites.
Judging by the number of keywords used for paid promotion, only 36% of neobanks use contextual ads.
Apart from general thematic keywords, such as bank cards, bank online uk etc., neobanks also place ads that target only the name of the brand. This gives them a relatively high conversion rate at a moderate price: contextual advertising that uses 'Revolut' as keyword comes out cheaper for Revolut itself than for its rivals.
One should also keep in mind that users can misspell the name of a bank – for instance, search for revalute instead of Revolut. In order not to miss such queries and obtain as much traffic as possible, neobanks also use misspelled keywords in their contextual advertising.
The number of neobanks' customers grows several fold every year. According to a study by Oliver Wyman, the user base of the UK neobanks (Monzo, Revolut, Atom, Starling, Tandem) increased from 0.6m to 2.5m.
In 2019, these banks had a total of 12.8 million users – a sixfold year-on-year growth.
Neobanks are expanding their service offerings and begin to target not only individuals but also businesses. This is shown by the Similarweb study of the UK neobanks, published in December 2019. According to the study, the number of views of digital banks' business account pages is growing.
One of the main issues constraining the adoption of neobanks is that customers use their products as an additional, not principal, financial tool – after all, their salaries are still paid to their traditional bank accounts. Therefore, attracting more businesses can help neobanks achieve mass adoption faster.
The largest customer age groups for all neobanks as a whole are 25-34 and 35-44 year-olds. This means that neobanks' key audience are millennials – people who are used to interacting with the world using digital devices.
Nevertheless, it's not enough to target only digitally advanced users anymore. A further expansion of neobanks requires a more varied client base. For example, in 2019 Revolut updated the terms of its User Agreement to make it accessible to a wider range of users:
Our study focuses on European neobanks, so it's not surprising that Europe accounts for more than 89% of all traffic.
Nevertheless, neobanks are actively entering foreign markets. Asia accounts for 3% of the traffic, while North America's share is 4%.
In order to compile this ranked list, we analysed over 53 thousand inbound links and 18 thousand domains linking to neobanking sites. We identified the top 20 categories of interests that characterize neobanks' target audience.