A number of foreign exchange (FX) brokers and financial service providers have resorted to creative ways and different measures to retain clients in an increasingly cutthroat industry. One such example is Admiral Markets, who recently initiated a Loyalty Program for clients, namely in a bid to help foster greater cohesion with its European clientele.
Finance Magnates spoke with Andrzej Tomczyk, Eastern-Central Europe Regional Director, Regional Board Member for Admiral Markets, and the architect behind the company’s program.
When asked what ultimately prompted the decision to initiate a Loyalty Program for clients at Admiral Markets, Mr. Tomczyk noted, “Admiral Club has been available for our clients for some time in one of our European operational companies. Lately we have decided to implement certain changes and improvements and fully automated the process. Our loyalty program – Admiral Club – is simply the essence of how we have been seen in our role in the financial markets – building up strong and long-term relationships with our clients.”
Explaining the program in detail, he mentioned, “Members of the club are awarded points, proportionally to the volume of their trades. Then, points can be converted into tradeable and withdrawable funds. Since the program was launched we have received many positive comments about it. Clients appreciate that the more they trade the more points they are getting. I believe that it is a very fair approach and clients benefit even more by trading with us.”
Indeed, the need to prevent client attrition has never been higher, with the recent example and fallout of Alpari UK convulsing the industry, consequently sending a cloud of clients to other brokers, such as ETX Capital. With no shortage of broker options to choose from, brokers have resorted to incentives for clients.
“Around three years ago brokers were competing with each other who is going to offer higher percentage of bonus. Fortunately, these times are over and clients are not into big bonuses anymore. I believe that we are facing certain levels of market saturation and entering a phase of a mature market. Nowadays, clients care more around the service itself, they appreciate high quality support and good education rather than high percentage of bonus or one time promotion.”
I believe that we are facing certain levels of market saturation and entering a phase of a mature market
In essence, “I am not saying that we do not offer any bonuses at all, as we do, but rather to retain the client and not to win him from the market or competitors. When a client sets up an account with us and trades for some time it is easier for us to know his needs better and offer a product that will suit him best.”
In particular, Admiral Markets possesses strong regional concentrations of clients, notwithstanding in its countries of operation. As such, “In terms of regional concentrations I believe it is quite natural that our clients reside mostly in the countries in which we are physically present. Our local offices provide support, analytical content and high-quality educational materials helping our clients to make their first steps in trading.”
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Moreover, “Thanks to that we are winning with our competitors, especially those who provide their services remotely and are further from clients and their needs. Therefore, we have the biggest concentration of clients in Europe – mostly Central and South-Eastern Europe, Western Europe and Baltic states,” he added.
Ultimately, according to Mr. Tomczyk, “There is only one feature our clients have in common – higher than average risk tolerance. In any other aspect our clientele varies greatly.”
Looking ahead, Finance Magnates asked Mr. Tomczyk about the future state of Admiral Markets, namely in H2 2015, as well as the advent of volatility with respect to the market as a whole.
Whereas the industry was mired in historically low bouts of volatility last summer, 2015 has proved to be anything but. However, “Market participants and central banks have been sitting next to the table playing the game for some time now but the time has come to finally show the cards. I guess not only me but also the whole market is waiting for the FED to decide on the future outline of US monetary policy and the first increase of historically low interest rates. Market was betting on that for long time already and it is a high time to say ‘check’.”
Market participants and central banks have been sitting next to the table playing the game for some time now but the time has come to finally show the cards
Unfortunately for proponents of volatility, the uncertainty of Greece leaving the EU seems to have come to an end, for now – however, even though Greece will take years to recover and get on the path of stable GDP growth, the EU as a whole has survived to fight another day, which holds repercussions for the euro.
However, “If the trend continues we are going to see more interesting moves on commodity currencies with strong US dollar keeping prices of commodities at low levels. Therefore, I stay bearish on Australian dollar (AUD), Canadian dollar (CAD) and Norwegian krone against US dollar.”
In terms of Admiral Markets, “Most of our new developments in the foreseeable future will be 100% clients oriented. On one side, we are working to deliver better trading environment with lower spreads and faster execution, while on the other we are focused on providing proper trading tools. These include both small, sometimes tiny but useful project and some bigger ones. For example, lately we have launched Market Heat Map, which helps our traders to pick high-potential market opportunities as well as to assess and manage risk wisely.”
In summary, “We keep on improving and adding new features to our MetaTrader 4 Supreme and working on the new version of our clients interface – Trader’s Room,” he reiterated.