The need for personalisation in Banking
Customers today have come to expect a level of personalisation while interacting with everyday brands. Technology companies like Amazon, Netflix, and Facebook have recognised the opportunity personalisation can offer organisations and have advanced their service offering through personalised experiences in order to meet constantly evolving customer expectations.
When you apply the same lens to the financial industry a consumer’s experiences with a banks digital channels, technology, products and services can influence their decision on which financial institutions to bank with. Customers are no longer satisfied with being treated as a number, instead personalised, tailored customer journeys have replaced the outdated approach to banking.
The Covid-19 pandemic itself has negatively impacted on the finances of households and businesses. For those negatively affected, their financial well-being and needs continue to change with cash flow management, budgeting and savings. Leveraging data to customise offers, enable financial knowhow and well-being is one way financial institutions can support their customers.
It’s imperative for banks to understand their customer data, the behaviour across segments and demographics, to identify the customer needs and support their financial well-being.
A recent Deloitte Report has stressed the relevance of Hyper-personalisation within Digital Banking. As per the report, Hyper-personalisation can be defined as using real-time data to generate insights by using behavioural science and data science to deliver services, products and pricing that are context-specific and relevant to customers’ manifest and latent needs (i.e. those needs which, due to a lack of information or availability of a product or service, cannot be satisfied).
Personalisation enables financial institutions to sustain and grow their customer base, cross-sell products, and proactively support financial inclusion to create better customer experiences.
Financial Institution’s are sitting on a mine of valuable customer data and insights. While some of the financial decisions are not as simple as filling out a form and clicking a button, the banks and financial institutions can help guide customers to make better decisions. It all comes down to education and building the trust with the customer.
With an increase in digital adoption, the relationship between the customer and financial institution has changed.
According to survey data conducted by Mozo 75% of Australians are now using a digital platform - either internet banking or a mobile app - to do their everyday banking. Highlighting the importance of creating a personalised omni-channel experience. Banks and financial institutions can leverage personalisation by;
Customers are demanding personalised experiences at an increasing rate, and the barriers to switch financial institutions have reduced significantly with advancement in technologies. Creating differentiation, sustaining and growing the customer base as well offering support as financial needs change, requires financial institutions to go beyond basic personalisation to hyper personalisation. Driving insights by leveraging data and analytics to support segmentation and audience targeting banks can look at to drive in hyper-personalisation.
Article published July, 2021
Hyper-personalisation: the key to banking’s past – and its future (finextra.com)
How Personalized Customer Experiences Can Benefit Banks (everfi.com)
What Does Personalization in Banking Really Mean? (bcg.com)
How to create a single view of the customer with banking software (scnsoft.com)
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