How banks can get up close and personal with their customers

By Evgeniy Ivantsov, Chief Marketing Officer, FYST

Evgeniy Ivantsov

What makes a great customers experience? It’s not the dazzling technology that enables transactions at lightning speed, nor is it having more products and lower fees than your competitors. What customers want is to feel listened to, understood and valued – that’s why personalising your customers’ banking journeys is the most valuable effort you could ever make.

The fast-moving financial landscape is being reshaped by changing consumer behaviours. It took around a decade for people to move from desktop banking to using mobile apps, but other behaviours have shifted virtually overnight, as we saw during the pandemic with the explosion of ecommerce, contactless and in-app payments.

You’d think that this surge of omnichannel usage would prompt banks to focus more attention on personalising banking. After all, digital payments in all their forms create goldmines of data that can be used to reshape growth strategies and create much more intuitive interactions with consumers. Despite this, bank customers are telling us it’s not the case right now – and they’re getting more impatient. Currently, only 25% of customers state that they’re happy with the level of personalisation they get.

And Generation Z consumers are less likely to stick with you if they’re not receiving personalised experiences, like product and service recommendations that are designed for their unique circumstances. When the latest generation of consumers is telling you they want something, banks need to sit up and take notice.

No matter the demographic they’re serving, banks can no longer get away with providing generic, one-size-fits all experiences. Collectively, we love the latest technologies and their ability to automate slow and frustrating processes, but it means consumers are more easily annoyed with bad experiences, and much more likely to switch providers. As humans, we have an annoying habit of remembering one negative experience more vividly than 10 positive ones – bank customers are no different.

The drive to differentiate

There’s no doubt that it’s getting harder for banks of all stripes to differentiate themselves. The rocky economic seas aren’t making things easier and are forcing many banks to re-anchor and evaluate their own journeys. With that in mind, personalising the customer experience as much as possible, at every interaction, should be the true north that banks should set their compasses to. It’s much easier and cheaper to keep an existing customer with consistently great experiences than it is to acquire a new one.

All the data available points to personalisation being the key to future-proof growth. Every customer wants friendly and useful help, with advice and products tailored to their unique circumstances. Four out of five consumers would share some type of personal data for a better experience, with such information as email address, birthday and age, and sex/gender identity topping the list. Even something as simple as addressing someone by the name can make a huge impact on their experience with you.

Ultimately, banks must not only provide personalised services but stay agile and primed for the future as consumer demands shift even more. Therefore, any personalised banking strategy should be built around customer data that can identify behavioural patterns and influence product and customer service capabilities. If you do that, you improve your customers’ satisfaction levels, which boosts retention rates.

With the right blend of tech in place – CRM platforms, data analytics and automated customer contact solutions – banks can turbocharge the delivery of personalised banking to their customers. But personalised banking needs to strike a balance between innovative tech and meaningful human support. At least one-third of consumers say that human interaction is important to their loyalty.

Data, Open Banking and AI converge

AI and machine learning are set to transform how banks analyse customer data to provide personalised services based on individual behaviours. Customer patterns and preferences can be mapped faster and transformed into actionable insights that create a holistic and ultra-personalised customer view.

AI’s ability to speed-read massive data sets in real time means it can accelerate customer onboarding and empower banks to identify what’s unique about each individual customer. With that valuable information, banks can make much more accurate and informed decisions.

Furthermore, with the help of AI-driven customer contact solutions, like chatbots or contact centre performance management platforms, banks can get a 360-degree view over every customer-bank agent interaction. AI tools can ‘listen’ for keywords in customer conversations with agents, and generate tailored responses to the agent to help improve query resolution.

The emergence and fast-growing popularity of Open Banking is set to give a massive boost to personalised banking. We’ve seen above that customers are willing to share data with their providers if it leads to better service. Increased data sharing between banks and other financial service providers will generate more behavioural and preference data. This gives banks even more scope to personalise products, pricing, and services for their customers.

Banks should never lose the human touch

Customers want the convenience that digital banking provides, such as for simple tasks like checking an account balance or requesting a new card. But let’s not forget that there are still many customers that want to speak to another human. Technology is useless if it doesn’t aid human connection. It’s shocking how many banks and fintech still make it make it difficult for customers to find their contact details.

Even the most tech-savvy consumer will occasionally need knowledgeable advice from a customer service agent – especially for urgent queries or sensitive matters like debt issues. As charming as chatbots can be, the AI algorithms that power them can’t tell a consumer why their request for a higher credit limit or account has been declined. Or why their card has suddenly been blocked.

As payment trends and technologies evolve, consumer behaviours will become even more demanding. Banks and other financial providers should make it their mission to extract every actionable insight from their data to create the personalised banking their customers crave.

But remember – while tech-driven tailored experiences can give you new competitive strengths, you must forget that humans are at the heart of every interaction.