Financial institutions are about to enter a new era, where leveraging data to personalize customer experiences will drive business outcomes at a faster pace. Banks and credit unions that properly transition into this new era will be predictive — not reactive — and will enable customers to engage with them whenever they want, however they want, and wherever they want.
The predictive bank of the future will analyze singular moments from individual customers across a wide range of devices, platforms, and products to identify patterns that make messages more relevant for customers. In aggregate, these moments can provide banks with cumulative intelligence to inform how they should be segmenting audiences and customizing the experience.
This isn’t just some unattainable dream either. Financial institutions who commit to a fully robust data analytics strategy will have the technological power to capture, analyze, and act on these moments as they happen — in real time, and in a programmatic manner (i.e., automated processes). Banking providers that accelerate and prioritize their analytics capabilities will create truly exceptional, meaningful and memorable moments for consumers.
For financial institutions to become truly predictive organizations, here are five areas where they must improve.
1. Dynamic Customer Journey Modeling
Rather than relying on the antiquated concept of a static, traditional marketing funnel, retail banks will be able to take different modeling approaches that enable them to deliver unique experiences at the touch point level throughout a customer’s nonlinear journey, whether that is a single authenticated interaction on a website, withdrawing a specific amount of cash at 2:30 pm when it’s raining outside, or having a satisfactory experience through a call center when solving pressing problem.
2. Portfolio Optimization
Not only will predictive banks be able to find the right products for their customers, they will be able to use data, indexing approaches, and fluid budgets to drive market share across a product portfolio. Rather than depending on previous traditional market segments, this form of portfolio optimization enables numerous cross-sell and upsell opportunities to highly refined audiences.
3. Life Stage Marketing
Eligibility rules can be applied to specific audiences according to different life stage events, triggers and milestones. Banking providers will be able to “speak” to consumers with timely, highly relevant messages. For instance, having a child could mean opening a 529 college savings plan, while landing a new job could mean activating or utilizing a 401K.
4. Meaningful Digital Experiences
Consumers’ digital experiences are combined and analyzed together, providing banks with cumulative intelligence that informs how to improve segmentation and effectively interact with people. As digital transactions proliferate and machine learning technology becomes more sophisticated, digital experiences will become emotionally satisfying for consumers. Machine learning can potentially emulate the best teller experience for a particular customer, making each interaction comparable to- or better than the average face-to-face interaction.
5. 360° Audience Hub
As data is used more frequently, and shared across organizations, silos break down and banks can have a 360-degree view of customers and households. With new visibility across systems, channels, products, and audiences, financial institutions can further personalize their services to maximize customer benefit. In addition, this visibility enables more opportunities for business innovation, growth, and an increase in operational efficiency.
Predictive analytics stands as an innovative framework for banks to personalize all customer touch points, while capturing digital data on a customer’s preferences. With data analysis, competitive financial institutions can deliver optimal experiences to the right customers through the right channels, driving business outcomes and customer benefits. Understand it, or get left behind.
Nikos Acuña is Director of Business Strategy at Rocket Fuel Inc., a big-data adtech company that leverages artificial intelligence to create meaningful brand experiences that drive results. He is the author of The Predictive Bank: Transforming Customer Experience through Data-Driven Innovation and Mindshare. To contact Nikos, you can send him an email.