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The Impact of Personalization in the Financial Services Industry

The expectation that a business should maintain detailed information regarding its customers is nothing new. For years, consumers have expected businesses to quickly be able to locate their account information, history with the company, standard demographic data and more.

As product and provider options within the financial services industry continue to evolve and diversify, consumers are likely to expect the organizations they do business with to maintain an even more detailed knowledge base.

Maintaining comprehensive customer data benefits organizations as much as it benefits consumers – the more information a financial service provider maintains, the better they may understand consumer needs and be able to adapt services to fill needs. Customer data also allows organizations to identify cross-sell opportunities. As digital records management and customer relationship management solutions increase in power, scalability and popularity, financial service providers should seize the opportunities presented by effective knowledge gathering and maintenance.

Of course, consumers expect financial service providers to do more than maintain a knowledge base – many expect that knowledge to be used to personalize interactions directly to their own unique needs and personality. Using customer knowledge, financial institutions can create deeply personalized interactions.

Let's look at an example:

Greg visits an ATM to withdraw cash from his account. His bank utilizes thumbprint recognition technology to provide a personalized banking experience. After authenticating his identity via thumbprint, Greg is offered a menu of options based on his most recent and most frequent ATM activity. By personalizing his options to his actual usage, the bank offers Greg a streamlined ATM interaction and eliminates any frustration Greg may experience by being forced to navigate unnecessary menu options.

The Impact of Personalization

The use of customer data to create deeply personalized transactions offers many potential benefits to financial services organizations and their patrons, including:

  • Streamlined interactions: Personalizing an interaction to a customer’s specific needs and expectations eliminates the need for the customer to traverse unnecessary menu options and reduces the amount of time the customer spends getting resolutions. The faster information can be found or business can be transacted, the more satisfied the customer becomes.
  • Improved information access: Customers in search of answers to questions or specific data want that information customized to their specific needs, rather than generalized to potential situations. A FAQs section of a website offers a wealth of general information, but that information may become inaccurate or incomplete when applied to a customer’s unique concerns. Personalizing data sources, such as the FAQ section, directly to the customer helps to eliminate frustration and confusion, and speeds the customer to the answers they seek.
  • Cross-selling opportunities: Offering customers products they may be interested in, or that fit their specific lifestyle needs, is a viable strategy for securing additional sales. Personalizing product offerings to customers encountering key lifestyle changes, such as a marriage, retirement or career change, may result in a deeper and more valuable relationship for both parties.

The effective use of customer data to personalize interactions is imperative to the future of any financial service provider. Without personalization options, customers are likely to feel undervalued and become increasingly frustrated with the need to continually explain their needs and situation to agents.