Financial Services Providers (FSPs) globally are racing to achieve growth objectives. Experts believe that the ability to deploy data analytics to improve consumer engagement will separate the winners from the also-rans.
In most parts of the world (including Nigeria), challenger banks are striking at the heart of the incumbent’s profit sanctuary by knowing customers better and giving them a more personalized value proposition. Customer transaction data (the diamond in the dirt) readily comes to mind. As FSPs automatically categorize customer transactions, they are able to segment these customers into spend categories. This provides a platform for more personalized communications with these customers, increasing engagement and customer lifetime value.
Smart FSP brands have caught this wave. They know that generic and mass-marketing campaigns are stuff of also-rans. Customers, from a mile away, can spot FSP brands that are unable to go the extra-mile to engage them. Their purchase decisions are far away from these brands. Imagine an FSP brand running predictive models to upsell and cross-sell a value proposition to a customer, based on their historical transaction patterns. FSP brands like this will always be near their customers’ hearts.
A recent article in Forbes Magazine notes that market leaders share a similar approach to the use of data to enhance customer experience, focusing on personalisation at scale. Great customer-centered brands understand that they can offer better customer communication and engagement when they know more about the customer.
In summary, by building data analytics capabilities, FSP brands are able to know their customers better and develop personalized communications with them, which BCG estimates can potentially provide a 3% increase in revenue on every unit of asset held.
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