Wells Fargo’s fake account scandal has hurt the financial services company, not only from a reputation standpoint but also from a business perspective, given some states are refusing to do business with the embattled bank. But a new report from SurveyMonkey shows the impact the scandal is having on its mobile banking business, with SurveyMonkey finding downloads of the mobile app declined 7.7 percent in the 30 days after the scandal broke compared to the previous 30 days.
At the same time that Wells Fargo was seeing a decline in downloads, competitors Chase and Bank of America saw a “modest” increase in downloads, reported SurveyMonkey. SurveyMonkey noted Wells Fargo showed a “ significant — and negative — departure from its previous growth rate” at a time when Chase’s and Bank of America’s download rate grew within the expected range for their apps. It’s not clear if the download decline rate at Wells Fargo will continue since the app has seen a recovery of sorts since it hit a bottom of 10,015 downloads on Sept. 27.
“Is Wells Fargo’s negative growth in new mobile app users in this recent period a direct result of potential and existing customers deciding not to do business with the bank due to its scam? We can’t definitively say,” wrote SurveyMonkey. “Wells Fargo has blamed a post-scandal downturn in account openings on ‘lower … marketing activity’ (among other things). If Wells Fargo has shifted its marketing efforts from promoting the app to addressing the scam, then that could certainly impact adoption (i.e., download) rates of the Wells Fargo Mobile app.”
In addition to a decline in the download rates of Wells Fargo‘s mobile app, SurveyMonkey found that, once the scandal broke, there was a sharp decline in usage rates for its mobile app, with usage 7.1 percent lower on Oct. 4 and Oct. 5. Even weekly retention rates declined once the world got whiff of the scandal, with retention rates hitting a six-month low of 78 percent for the week ended Oct. 9. And while it is only a 2.7 percent decline from before the scandal broke, it is an impactful amount.
“For a mobile app that has 7 million weekly active users, when the weekly user retention rate drops 2.5 percent from 80 percent to 78 percent, that’s an additional 140,000 users who aren’t returning to the app from one week to the next,” wrote SurveyMonkey. “Sure, some of those users might return in later weeks or months, but some percentage of these hundreds of thousands of users that Wells Fargo has lost from week to week since the scandal began will never return.”