When it comes to retail trading business, thigs often become bigger when scale of is taken into consideration. Specifically, building only a fully integrated onboarding process is elaborate, complicated and, therefore, difficult. As already discussed in the first part of the series, brokers need to consider both simplicity for the potential traders and compliance in the onboarding processes.
Building Smarter, Not Larger
However, every big project becomes manageable when broken down into multiple smaller parts. Looking around the retail trading landscape, one broker leading the pack is Plus500.
The Israel-based LSE-listed broker is a notable example of how to create a fully automated pipeline that allows prospects to become traders with minimal human intervention. The client journey is complex but appears simple. Plus500 claims to achieve mass auto conversions, and their market success in recent years suggests they've cracked the code of the onboarding process.
Let's look outside the retail trading industry and check for novel examples of excellent approaches to onboarding. We can find suitable examples in the cryptosphere, such as Binance and Bybit. Meanwhile, Betfair and Bet365 demonstrate how the process should work in the gambling space.
It is also worth noting that platforms like Robinhood is introducing gamification aspects into the sign-up and trading process – a new trend that seems to work for their respective businesses. Gamification makes the client journey more fun and engaging for excitable new traders – a win-win for both the broker and the client.
The Journey Clients Want
A prospective client should be able to answer the following questions without checking anything.
It is entirely understandable that novice users will struggle to understand everything the platform can do on day one. However, this needn't be a disadvantage. On the contrary, the steep learning curve in trading can establish better client-broker relationships and create valuable opportunities to help the client grow as a trader.
To reassure novice clients, the broker must appear as a safe haven that shelters people from financial storms. In the initial stages, many novice clients will feel their entire trading experience is like a storm, further entrenching the need for active traders to have real-time client support. This could be done via online chat, voice, or video calls. Regardless of how it’s done, these measures ensure the client is always well-informed and never feels confused about his topsy-turvy trading experience.
Simplifying Complexity
Other aspects are worth considering, including leverage, overnight swaps and automatic stop-outs (margin calls).
Most novice traders will have never heard of "leverage" until they place their first trade. Also, they will likely need clarification about daily overnight charges called FX swaps being levied on their FX trades. Losing trades that are automatically stopped out to prevent a trader's account from going into negative territory is also poorly understood.
Suppose a broker waits for these possibilities to eventuate before explaining them to the client. This tends to undermine the client-broker relationship and could be interpreted as a nefarious move when, in fact, the broker was simply inattentive and forgot about the little details that can mean so much.
One Size Doesn't Fit all
In online trading, MetaTrader is the go-to standard.
This platform has dominated the retail space for over a decade, meaning most brokers licence third-party software as part of their operations.
Other solutions, such as cTrader and Devexperts, are available but not without their particular foibles. Still, the same fundamental question stands: should brokers offer their clients multiple trading platforms (to cover all their clients' needs) or just one (to simplify their operations and make a seamless offering all the more achievable)?
The easy answer is that there's no easy answer.
For some brokers, offering multiple trading platforms and trying to knit them together as part of a cohesive offering will be suitable. For other brokers, it will be appropriate to forego all the additional benefits multiple software packages offer and stick with one platform.
For most brokers, one offering is entirely sufficient. They may not be able to capture all clients in all countries, but the ones they do attract will have a better trading experience. For others, such as Libertex and Deriv, a multi-platform offering is more suitable, although both have room for improvement in making the client journey smooth and intuitive.
One trading platform can never fit everyone's needs, while a multi-platform offering will always undermine a cohesive onboarding process that relies on consistency and simplicity.
Therefore, with all things considered, brokers should strongly consider catering for “multi-environments” to avoid clients getting lost in an administrative maze.
Only when clients have obtained sufficient trading experience can they feel comfortable with any trading platform and understand the nuances between them. Until then (and considering that most clients are novices), the safest bet is to provide clients with simplicity instead of what the broker finds comfortable.
