In an age of increasing digital sophistication, customer intelligence is playing a prominent role in giving brands an advantage over the competition. The pandemic has made it imperative for financial institutions, which often claim to be customer-centric, to look much deeper and analyse customer behaviours.
By understanding their challenges, pain points, and goals, financial institutions can proactively engage with their customers, providing advice and personalised products.
Customer Intelligence has become more important than ever to maximise mindshare, drive customer retention and improve share of wallet.
Also Read: Paytm's journey: From payments app to a fintech and now - Dalal Street
Engage The Young
Learning about money at an early age has become imperative and creating a hands-on and fun experience can teach pre-teen, teens and older Gen Z (15-24 years) customers valuable money management lessons.
Becoming a part of their journey early on will not only help build trust but also establish a long-term relationship for various financial solutions. While customers progress in their lives, brands can build upon their relationships with them and address changing and evolving customer needs.
These changing needs have a significant impact on consumers financial decision making. For example, Gen Z and Millennial consumers are less averse to borrow earlier in their lives, while they need to be convinced of the value of a product before buying and often turn to peer networks, as well as to social networks for reviews and expert opinions.
They also have a higher tendency to prioritise experience over ownership, and that directly influences the nature of their investments.
With access to this data and information, financial institutions can assess and design the right approach to engage with each segment of their customers and offer relevant products via the most appropriate channels.
Also Read: RBI panel's recommendations to promote orderly growth of digital lending, say industry players
Establishing a holistic view of a customer can be a very effective driver of business growth and profitability for financial institutions.
Adopting customer-centric models in customer data intelligence programs will need a data-management approach that aggregates scattered data across different channels to create meaningful insights.
There are various channels through which a customer interacts with the brand, these include their branch activity, web activity, in-app activity, support calls and feedback, etc.
It's an opportunity for financial institutions to use data collected across touchpoints to get a rounded view of the customer's engagement with the institution.
Financial institutions which look below the surface to examine these behavioural data points will not only understand customer decision making processes better but can establish much more effective ways of engaging with customers.
Tech making it possible
With data now accessible from a variety of sources, hyper-connectivity can give financial institutions an opportunity to access and mine this data.
It is not just technology platforms that record and communicate data, but everything from smart personal devices to other connected devices and appliances, while complying with appropriate regulatory frameworks which are themselves continuously evolving.
While we see customers becoming extra-cautious about sharing personal data, it is expected that they will be more open to sharing it with banks, lenders, insurers, and asset managers in return for the best deals and better financial advice.
As we enter the era of open banking, regulatory frameworks are falling in place around this and will enable content-driven sharing of data, which can then be ploughed back into analysis platforms that can enrich intelligence around customers and prospects.
On the customer experience front, financial institutions are piloting AI-based client advisors, to provide advanced context-based services to their customers.
These AI engines are primed with product, customer profile and financial analysis information, customer call and product enquiry history, bank policy, procedures and guidelines, and more, to equip them to provide input back to clients that closely mimic human advisors.
AI, machine learning, natural language processing backed by insights driven by data analytics are expected to drive advances in customer experience and client engagement over the next decade.
Financial institutions need to reimagine their value propositions and utility for a new generation of customers by leveraging technologies that can do a lot more for their current and prospective customers.
3 C's - Competitive Comparisons, Constant Change and Customer Centricity
As customers increasingly get more connected through social platforms, they are becoming more demanding and probably less loyal.
An environment that enables easier comparison and faster switching means relationships can be less enduring and more transactional without high levels of attachment.
We are already witnessing capabilities such as one-click transfers, which can move funds through direct debit instructions, to a new provider with little effort at the customer's end.
Changing consumer behaviour driven by demographic shifts are expected to have significant implications for incumbent financial institutions, with newly acquired customers being less attached and loyal to a brand in future.
Customer centricity, customer insights and intelligence-driven engagement can help institutions in a rapidly changing world.
Offering relevant tools, services and products to customers that help them cope with changing and uncertain times can strengthen engagement and expand wallet-share. This will not only veer them towards mutually beneficial behaviours but also make them stay loyal for much longer.
(The author is Head of Banking, FIS.)
Copyright©2021 Living Media India Limited. For reprint rights: Syndications Today