Putting clients at the centre of business decisions and adopting a data-driven management model helps develop more personalised experiences as to improve customer acquisition, retention and loyalty. This is one of the most significant conclusions of the report “The customer engagement imperative. What Banks can learn from the FinTech Playbook”, which is part of the “World Report Series Retail Banking”, published by the Capgemini Research Institute, with the collaboration of Efma, which affirms that “customers, not products or business lines, are the center point of strategies and business models today. The ability to leverage large volumes of data and new technologies to understand customer’s journeys and deliver personalized offers and experiences is now considered critical to driving loyalty, engagement and, ultimately, growth”.
What are the expectations of banking customers according to the Capgemini Research Institute?
This way of banking business development, heavily inspired by FinTech models, is the driving force behind the transformation of traditional banking in response to customer demands, as stated in the report prepared by the Capgemini Research Institute: “Personalization is to the digital environment what the branch is to the physical world – a way for Banks to engage with the customer. […] it’s about knowing customers well enough through data to anticipate their needs and engage them in real time across all channels.”
This report, which is based on a survey of more than 8,000 banking customers worldwide and 140 industry professionals, indicates that customer expectations are based on experiences that bridge the digital and physical worlds, are relevant, connected and eliminate friction between channels. For Markus J. Locher, Managing Director and Head of Digital Banking at Credit Suisse, “as we move into de the future, striking the right balance between physical presence in branch offices and digital channels is essential for acquiring customers or selling products.”
So, just what more do customers need from their financial providers? A stronger emotional connection: “banking relationships were not emotionally connected nor well-integrated into their lifestyles; 52% said banking was not “fun”. Many respondents say their banks do not offer the seamless experience, personalisation and innovation they want from their branch relationships”.
Improving customer experience with data
Many banks have already recognised this need to reconnect with their customers, and are making strides in the effort to accelerate their digital transformation towards personalising financial services through data, such as the case of Zurich Cantonal Bank in Switzerland, which its Head of Direct Banking, Alexandra Scriba highlights in the Capgemini Research Institute report:
“Data is critical to identifying target customers, personalizing their experience, and nurturing customer relationships. However, banks wrestle with data quality, structure, availability, etc., to unlock its full potential.”
The main objective of this process is to find the formula to identify and offer a product at the right time for each customer, that is to say, a personalised, omnichannel experience. As Maurizio Giglioli, Director of Marketing and Planning for the Commercial Business Unit of Credem Banca in Italy, explains in the report: “Banks optimize engagement by moving to real time data for insight into customer behavior, to understand needs, and design a customer journey that immediately triggers multi-channel actions.”
Traditional banks must work to improve their ability to interpret large volumes of data and embrace the use of technology as a key enabler to create stronger connections and maximise value for their customers. “To deliver the personalised omnichannel experiences and ecosystem journeys customers want, banks must pivot to platform business models that leverage data and new technologies,” Capgemini Research Institute experts state in the report.
The opportunity for real-time analytics
A very relevant example of the type of data that banks can manage is transactional events from their customers’ operations. Real-time analysis of these transactions can be an excellent tool for enhancing the bank-customer relationship, since, according to Francesc Pérez, Chief Revenue Officer of Latinia, “thanks to real-time analysis of customer transactions, we have the opportunity to become part of their daily lives. No matter how digital our customer is, their life does not take place in the bank’s digital channels. We need tools that allow us to identify those unique moments when it makes sense for the bank to show up and talk to customers about things that interest them, which are useful and meaningful, proving that we know them”.
In short, according to the conclusions of the Capgemini Research Institute report, banks will be able to offer relevant experiences to their clients if they manage to make the very most of data, from a customer-centric perspective, and firmly commit to innovation:
“With enhanced data governance models, banks can collect proprietary customer insights to improve the competitiveness of their digital marketing capabilities. Combining this with AI and Machine Learning (ML) will unlock new possibilities in identifying, retaining and engaging customers with real-time experiences.”