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How Can Retail Banks Navigate the Personalization Challenge?

Personalization is a common expectation for customers these days. No matter where they go, what device they are using or how they choose to interact with their brands, they want to see ‘intelligent offerings’ that relate to them and are uniquely targeted to them.

Evidences prove that retail organizations are leaving no stone unturned in living up to that expectation. I personally experienced it while contemplating a gift for my wife, as I was receiving recommendations for similar products and/or what others with similar preferences were viewing.  That was incredible, as I was yet to perform the transaction on the retailer’s website for which I had not even registered yet.

This expectation remains pretty much the same when we interact with our banks, and more so because the scope of personalization is even more in banking as they have access to a lot of valuable customer data- spending, investment, frequent purchases and so on. But, personalization in banking remains to be an unfulfilled dream. I have performed numerous credit card, cash, and checking transactions, and have been a customer for more than 15 years, and have also availed relationship banking services. Then, why am I not receiving any personalized offerings from my bank – why am I receiving a CD offer that’s for a different classification of an account; Why don’t I receive recommendations to avoid banking fee such as overdraft; Why don’t I receive advice on savings or making improvements on my budget planning; Why am I transferred to interdepartmental call center representatives and repetitively need to state the same issue?

Why is my bank unable to provide me personalized experiences when they have a lake of information about me?

Personalization in retail banking entails a wide spectrum of offerings, as they say, “different strokes for different folks”. It extends beyond products and offers, and is about providing a frictionless, seamless, and pleasurable experience to customers, while knowing who they are, what they like/dislike, predicting their behaviors, and optimizing their next best action.

The financial services industry is often challenged with data, processes and technologies, as well as littered with regulatory and compliance requirements, such as PCI DSS (The Payment Card Industry Data Security Standard).

The major challenges that financial services providers encounter in delivering personalization are:

  • Data Quality
  • Data Islands
  • System Integration
  • Antiquated technologies
  • Inconsistent Omni-channel experience
  • Regulatory and compliance issues

How to Address these Challenges?

To address these challenges, banks must start with comprehension and analytical assessment of Customer Experience (CX) woven with data analytics, statistical modeling, and technologies such as artificial intelligence, machine learning, and building agile yet scalable digital platforms. The personalization best practices may be characterized as an iterative lifecycle assessment balanced with a capability architecture and manifested through technologies.

Iteratively, define the business value for your enterprise and organizational strategic imperative(s) and align with the respective customer analytics classification(s).  Leveraging customer segmentation, profile your customers utilize data management best practices, and outline analytical models that simply and improve the CX.  Continuously monitor & calibrate your models and measure the respective KPI’s they’re delivering aligned to the LOB process.  Finally, instantiate your models leveraging your technology components adhering to architectural criteria.

Personalization in Retail Banking

The Capability Model illustrated below provides the governance, principles, architectural criteria, and quality attributes to guide the technology selection.

The enabling technologies specified below are the constructs and rails that host your analytical engine and facilitate CX improvement and the attainment of various facets of personalization.

Personalization in Retail Banking

To truly ascertain personalization means navigating the customer journey, measuring, modeling and calibrating with data- quoting W. Edwards Deming, “In God we trust: all others bring data”.

Through experience engineering and data analytics, comprehend your customer’s social and transactional activities spanning omni-channel, and implement platform modernization via MVPs (Minimum Viable Products) to accelerate and raise the customer experience. Personalization is a ubiquitous journey, where moving along with the right partner enables you to navigate, continuously calibrate, and adapt to changing market dynamics.

As you contemplate evolving your personalization ecosystem, select an experienced partner like Ness to unify your cross functional teams and guide the enterprise as they embark on disrupting the digital economy.