Customer analytics & insights: an imperative for the banking industry

  • Posted on August 10, 2016

customer analytics for banking

As the world evolves more toward C2B (consumer to business) relationships, the major C2B players— including Google, Apple, Facebook and Amazon (GAFA)—have been increasingly encroaching on the territory of traditional banks. In order for these players to become more relevant in consumers’ lives, they have been naturally expanding the full range of their offerings to include not just shopping, entertainment and travel, but also products and services that address people’s health, their homes and their money.

In addition, Gartner indicates the market for IoT devices is poised to expand and will reach nearly 21 billion connected devices by 2020. Customer analytics such as data points on customer behavior collected from connected devices means a tremendous amount of data that can be analyzed in real-time to obtain customer insights used to create personalized offerings and/or complementary products. This can help customers transact better, save better and bank better.

In order to increase customer interactions and to generate new revenue streams, banks are also exploring new business models such as collaboration with different loyalty companies to reward customers for their purchases in real-time.

By using data- and location-driven insights, banks can anticipate customer needs and offer advice, products and solutions to help customers make smart, financially-sound decisions. With benefits like these, the use of analytics-based reward programs is becoming a key differentiator for banks.

Realizing the Value of Customer Data

Unlocking the value of data is the key constraint for many banks. They currently have silos of data that are growing in size and are not integrated. Analysis of customer data sets is disjointed given the inconsistent approaches, tools and technologies being utilized.

Banks must bring all these data sources together to be able to analyze it. To do this, banks need intelligent solutions that can turn customer data into holistic customer analytics to create more compelling consumer experiences.

To achieve the data-driven experience, there needs to be greater alignment across the organization of people, processes, technologies and partner ecosystems. Data is already being gathered in many instances, but banks must be able to analyze it in smarter ways and automatically take proactive action at the exact right moment based on predictive analytics.

We are working with banks to realize the potential of customer data using the Avanade Customer Analytics and Insights (ACAI) solution to deliver personalized content in context to drive engagement, with customers, partners and suppliers with speed and flexibility. ACAI converts data into insights and recommendations on next-best actions based on the history and needs of the customer. By using the ACAI solution, banks can identify specific customer segments where there is an untapped potential for new business.  For example, using customer data- and location-driven insights, banks can anticipate customer needs and offer targeted products and discounts, helping their valued customers make informed financial decisions in real time.

Having an intelligent customer analytics platform will help banks to identify customer needs, but banks require an effective digital channel approach strategy to engage customers during various touch points. Avanade helps banks to build stronger customer relationships throughout the buying journey.

I think advanced customer analytics using connected data is an opportunity to redefine the playing field. Banks that get ahead of the curve in their technology adoption, improve their customer experience, engage their audience and boost productivity will be tomorrow’s market leaders. They will be better poised to gain a competitive advantage and win new customers…especially millennials.

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