The Financial Services Industry has went through a complete transformation at its very core. While the good old days were marked by a few Giant corporations handling the whole industry, today’s age of agile startups has seen an influx of various small and medium FinTech companies that are lean and efficient – both in their operations as well as the customer experience. The Customers too, habituated to the relative ease of other services that underwent digital transformation, like calling a taxi or finding a hotel, expect much. Their demands are ever increasing and the cost of failure has become too high.
So what is a guy supposed to do to keep up? Simple. Make things personal.
Technology has made making things personal much easier
New tech like marketing cloud, big data and intelligent technologies such as artificial intelligence (AI) & Deep Learning (DL) are allowing companies to do much more than what they were previously capable of. They are used for developing and deploying sophisticated algorithms to make sure that customers are shown things they want to be shown. However, the Financial Services industry has been a bit late to the party.
A recent Digital Banking Report found that “roughly 40 percent of all but the very largest financial institutions consider themselves ‘static,’ meaning they offer no personalization within their application”. That’s not cool. Not at all. It’s a pretty well known fact that customer experience (CX) through personalization drives more revenue and improves loyalty, affinity and lifetime value, which should all appeal to the money-conscious cohort that Financial Services is.
Think Across Multiple Channels – Work for The Same Goal
Poll a room full of individuals on whether they’ve visited a physical bank location in the last month and you’re likely to get only a small show of hands. Yet, a study found that the average customers have 10 digital interactions per month with their main bank. While interactions are happening less frequently at physical locations, banks can still have meaningful interactions with customers if the organization can move beyond thinking in channels.
Most organizations are marketing to their target audience based on some basic principles and rules outlined per channel. In any case, if the bank’s activities are not closely monitored across various channels, they lose track of a customer when they moves from one channel onto the next—say from mobile to PC. Without a top level view of the customer’s journey, it’s pretty hard to deliver them an experience that seems both personal as well as seamless across multiple channels.
All in all, what’s acting as a burden? Two things: separated information and the absence of a strategic viewpoint that covers the whole journey of the customer. Genuine personalization takes in constant behavioral information from everywhere – web browsing sessions, IoT
In any case, to see every client’s journey, Financial Services establishments need to incorporate old as well as transactional information secured in Kiosks (like billied amount,etc.), and also event information, for example, missed installments. By joining information (behavioral, value-based and verifiable) into a solitary perspective of the customer, the bank can boost its conversion by being constantly present on all platforms and delivering a message tailored to both the customer as well as the platform.
How to scale Personalization in Financial Services- The Artificial Intelligence Way
The National Business Research Institute surveyed 100 financial services executives and found that only 32 percent of the group were using AI technologies such as predictive analytics, image processing, recommendation engines, voice recognition, and response. Even amongst these 32 percent, most executives work for global level organizations. The main reason for this lies in the fact that there is a big absence of Top level Technocrats in these organizations. Most of their tech solutions are outsourced to agencies which have no idea how to build software that are smart.
Personalization is essential for any organization of any scale – it’s direct impact on revenue is too positive to ignore. Traditionally,Banks have been putting their customers in segments: They divide customers into groups and tailor offers and communications accordingly. Slicing customers into these segments with modern marketing tools makes them progressively smaller until the number explodes and becomes too complex to manage. Once this segment gets down to 1:1 , a phenomenon called “audience explosion” happens. The phenomenon is easy to understand (but tremendously hard to handle, at least manually). It become simply just too difficult to offer personalized recommendations to millions of customers. Even simple automation won’t suffice here which is why AI is used to serve each customer a platter of stuff they love the most. Some banks have already started to invest in virtual assistants to interact with their customers via chatbots, which predict and react to changes in customer behavior with AI. The power to serve every customer in this way across every channel gives banks unlimited potential to grow their business.
Summing It Up
Artificial Intelligence is a force – much akin to electricity. How you are using it is entirely upto you. But the one thing that is sure is that it WILL make your work both better as well as easier. Banks are just one of the many industries that have yet to understand the plethora of benefits AI is going to be bringing. Personalization has been a proven method of both incrementing revenue as well as making customers happy – and AI, is what is going to ensure that all Banks are doing personalization right.