Charles Schwab creates a great customer experience by streamlining everything. The company’s platform reduces customer cognitive load to a minimum.

So what?: 

Customer experience doesn’t need to be bright and flashy. It can be clean, simple, and fluid.


Customer engagement often delivers fun, sometimes quirky experiences to customers. Companies like KFC or Red Bull can get away with wild marketing campaigns. But what if your industry is finance?

Finance companies need to project an aura of grave professionalism. They simply cannot pursue the same strategies as their colorful peers in other industries. But they can still deliver satisfying, engaging customer experiences.

Charles Schwab has mastered the art of customer engagement for finance. They earned Investor Business Daily’s Best Online Broker award for 2022.

What makes Charles Schwab’s customer experience so engaging? Here are four practices they focus on:

  • Satisfaction guarantee
  • Very low or no commissions
  • Subscription-based service
  • Data-driven experience

Their strategy works. 29.6 million people opened brokerage accounts with Charles Schwab in 2020 alone, earning the company $11.69 billion in revenue.

Satisfaction Guarantee

Charles Schwab offers a satisfaction guarantee on its managed portfolios and bank deposits. This means that investors can refund fees and commissions if they are not satisfied with the work of the fund in handling their money.

In finance, risk is everything, and the satisfaction guarantee cuts out a little bit of risk. Commissions and fees are usually small compared to the size of an entire investment, but the ability to refund them is a nice touch.

A satisfaction guarantee helps demonstrate that a business has skin in the game. It signals that they are willing to take a loss if they do an unsatisfactory job.

More than anything else, then, Charles Schwab’s satisfaction guarantee is there to establish trust. It may rarely be used, but its existence gives customers a reason to trust them.

Very Low or No Commissions

Many of Charles Schwab’s products are not functionally different from its competitors. A share of Apple is the same, regardless of which broker you buy it from. Having very low commissions helps distinguish Charles Schwab from its competitors.

All online trades have a $0 commission. The only thing Charles Schwab could do to make it easier for customers would be to literally pay them to buy stocks.

(Then again, in a sense, Charles Schwab does precisely that. New customers can receive a free $101 starter kit to invest in stocks.)

The point is, low prices are a form of customer engagement. Low prices reduce the amount of friction standing in the way of a customer making a purchase.

Subscription-Based Service

We live in the era of subscription-based everything. Netflix, Spotify, and Dollar Shave Club are popular subscription-based services. And more and more businesses are finding ways to turn their products into subscriptions.

Subscriptions are a win-win for everyone. They provide reliable revenue streams for corporations. And they cut down on decision-making for stressed-out customers living in an information-dense world.

Purchasing a cheap, monthly subscription can feel easier than buying an entire item upfront. After all, this month is cheap, and the next payment is weeks away. Customers face less internal friction with a subscription-based payment plan, even if the total cost is greater.

Charles Schwab offers a subscription-based AI portfolio program. It lets customers pay into it regularly and have it managed to suit their financial goals and preferences.

Data-driven experience

Customers are now used to digital algorithms shaping their online experience. Their data creates Spotify playlists, Youtube video recommendations, and Facebook news feeds.

Charles Schwab uses customer data to help improve their experience. They developed a patent-pending algorithm that makes investing more accessible.

This algorithm attempts to understand client intent by analyzing customer actions. By analyzing billions of pieces of data, it can adjust the behavior of the Charles Schwab website or mobile app.

For example, suppose you start to make a wire transfer. Running into difficulty, you call the Schwab customer service number. Anticipating your need, that number then connects you to the department for wire transfers.

The algorithm also makes proactive moves. This includes scanning websites and interaction data to find out what problems drive customers to look for help the most. This helps Charles Schwab find potential bottlenecks and roadblocks, so they can find a way to fix them.

In a nutshell, Charles Schwab now operates as a single, holistic entity. Whether customers call customer service, use the website, or download the app, their experience is a seamless whole.

Data-driven experiences like this help in several ways:

  • It cuts through the complications of the brokerage industry.
  • It helps customers get the exact help they need.
  • It makes customers feel like their unique needs are important.

And in general, it works to remove friction from the customer experience.

Takeaways: How To Do Customer Engagement Like Charles Schwab

Finance is complicated. Everything Charles Schwab does removes complications, making it easier for customers to simply say “Yes!”

A satisfaction guarantee helps reduce the risk of a purchase.

Very low or zero commissions make the cost of transactions low.

Subscription-based services lock customers into a regular habit, all for a low, upfront cost.

And their data-driven ecosystem minimizes the amount of time that customers feel confused.

Charles Schwab’s strategy really works in just about any industry. All you have to do is reduce the amount of thinking and deciding that a customer has to do.

Creating a customer engagement plan like Charles Schwab is simple: Identify points of friction in the customer experience, then remove them.

Points of friction are anywhere that a customer has to stop, make a decision, and perhaps consider turning to a competitor instead. If you remove these points of friction, customers will simply slide into your arms.

At Media Shower, we help brands build customer engagement strategies to fit their needs. We know how to remove friction from your customer experience. Our team understands the strategies employed by companies as diverse as Red Bull, Starbucks, or Alibaba. This helps us to craft a unique plan for you.

Try Media Shower for free and see how we can help.

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