Banking

The promise of personalization: Can banks get a leg up by following retail’s lead?

Over the past few decades, the financial services industry has done a good job of innovating and utilizing new technology to the benefit of customers. Just look at the rise of mobile banking, for example, which has completely transformed the industry. And yet, despite the progress that many banks have made, most have lagged behind their peers in other industries in one crucial area. They’re simply not effective when it comes to getting their customers to convert on their websites or other digital channels.

Make no mistake, banks have done a fairly good job of driving prospects and customers where they want them to go online. The problem, however, is that they don’t always take the desired actions once they get there. The vast majority of people who come to a bank’s website to investigate its products, for instance, don’t wind up applying for or opening an account. Likewise, even if they start an application online, they often fail to complete it. Instead, they usually turn to other, more expensive, channels (like talking to a customer service rep) to get what they need. Worse yet, they may even go to a competitor.

Following the retail industry’s lead on personalization

Despite their best efforts to avoid scenarios like these, most financial institutions eventually hit a conversion plateau. The reason for this is that they’re unable to accurately anticipate the needs of their prospects or create interactions that help shepherd them down the path to purchase. The key to solving this problem is for financial services companies to create better experiences for their customers using personalization.

Personalization is about tailoring a product or service to an individual’s needs or wants. It’s about informing, guiding, and demonstrating care for customers and prospects. Unfortunately, most banks have historically been unable to deliver the kind of personalization that customers have come to expect from other industries.

To get a better handle on personalization, financial institutions would be wise to take a page from leading retailers’ playbooks, who have generally made much greater progress in this area. Specifically, some of the key lessons that banks can glean from retailers includes:

  • Fine-tuning their product details and content to convert browsers and buyers

  • Letting customers curate and save products directly in the digital channel they’re using

  • Guiding customers to the products they want without disrupting their search

  • Delivering superior search experiences

  • Personalizing customer’s product recommendations and search tools

Banks that adopt personalization techniques like these will be best positioned to increase conversion rates and drive more business.

No personalization without privacy

The tricky part about personalization, particularly in a highly regulated industry like financial services, is delivering it in a way that preserves privacy and ensures security.

To speak to these issues, we recently hosted a webinar with Forrester principal analyst, Peter Wannemacher, and our VP of marketing, Rahim Kaba. Entitled “AI and Beyond: What Banks Can Learn from Retailers to Boost Customer Acquisition,” it covers the personalization challenge facing banks in more detail. It then goes on to highlight promising new developments with AI and cross-industry intelligence that are empowering banks to leverage insights from other industries to gain a better understanding of their prospects’ needs.

Watch the on-demand webinar now to learn more about how AI and cross-industry intelligence can help banks identify their next best customer and boost digital customer acquisition and engagement. In the process, you’ll also learn how to achieve effective personalized experiences without relying on personally identifiable information (PII) and how consumer behavioral insights, rather than individual identities and PII, can ultimately create more customer trust and loyalty.

For any bank looking to gain a competitive advantage, unlocking the power of personalization is key.

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