The Art and Science of Data-Driven Personalization
Personalization involves the
communication of relevant, tailored messages to banking consumers based on
their individual preferences, needs, and behaviors at a particular point in
time. In today’s new, hybrid world, financial institutions (FIs) seeking to strengthen
accountholder relationships will find that doing so means you need to
effectively utilize a deliberate blend of personal and digital touchpoints to
deliver these communications.
This is where data-driven personalization shines. It is a strong enabler for community banks and credit unions to engage accountholders while enhancing their satisfaction, loyalty, retention, and profitability. Personalization can be a powerful tool for them to leverage. To be most effective in engaging your audience requires a delicate balance of art and science, combining human insights and creativity with data and technology.
Not too long ago, cross-selling products and services was based on personal relationships and largely a manual process that did not scale well. A banker might identify one of his consumers to be looking for a new home and be ready to offer a mortgage product. This relies on their personal knowledge of such instances, again, something that is hard to scale and resource.
Another tactic is to employ the blanket approach where a financial institution might blast out a direct mail or email to every accountholder pushing HELOCs (Home Equity Lines of Credit). This tactic, with minimal personalization or thought given to individuals that comprise the audience, including those that don’t even own homes, can result in poor conversion rates in addition to vividly demonstrating how little the financial institution actually cares about its individual consumers.
The art of personalization: understanding accountholders
Personalization begins with understanding accountholders as individuals, rather than merely as segments or averages. Knowing who they are, what they want and what they need financially must culminate in actions to help meet those needs. Empathy of their pain points, aspirations, and emotions must translate into meaningful communications.
With the digitization of the financial services
landscape, personal touchpoints need to be supplemented and complemented with
personalized digital touchpoints. These can indeed scale very well and
ultimately be well automated while ach...