Personalization in Banking: How Banks Can Do Better by Overcoming Assumptions

In a previous blog on this topic, I talked about how and why consumers demand better personalization from financial institutions. Expectations are high, and so is the payoff. Knowing that, I had to wonder: Why are so many financial institutions falling short of their personalization goals?

The answers go beyond just the technology facilitating personalization, and into assumptions and biases. The good news is that misconceptions can be identified and realigned, paving the way for better and more rewarding omnichannel customer interactions.

  • Social media requires specialized messaging: It’s customary for companies to list all of their supported social media channels in a tight cluster and mention them all in the same breath. That does not mean that all social media platforms are created equal, however. I’m not referring to the technological differences so much as the experiential differences and the ways consumers think about engagement on each platform. For example, people don’t open Instagram to read about new products, discounts, or offers. They flick through to be inspired, to see people doing things that brighten their world and make a difference. So using your bank’s hard-won Instagram presence to promote a competitive loan rate won’t boost your standing, no matter how many impressions you get. People want to see what they want their future to be, and then be reminded of ways to get there. Start using your social media channels in the ways your customers expect and welcome, not just to maximize impressions on a product-pushing campaign.
  • Silos are (still) hurting you: Banks have historically succeeded at introducing new transaction channels, from drive-ups and tele-banking to ATMs and mobile apps. But many banks have consistently fallen short at collapsing the silos between these channels. Too many institutions still run separate and distinct teams and organizations for each touchpoint. That may make for a clean organizational chart, but it means loyal customers often go unrecognized when they appear in a new channel. And the customer journey is increasingly multichannel. A 2016 McKinsey report found that more than 50 percent of customer interactions occur in a multi-event, multichannel journey. A siloed organization can’t recognize that customers need to be presented with choices for the next step in their journey at every touchpoint, not just the most recent one. That’s a limitation that causes customer frustration and fatigue, and ultimately loses business to more agile competitors.
  • Engagements are conversations, and conversations require listening: Measuring return on investment (ROI) is important to marketing execution, but it cannot be the only thing you look at. It’s become easier than ever to have a genuine omnichannel give-and-take conversation with any one of millions of consumers and truly understand where that individual is coming from and where they are going. But as soon as you focus most of your attention on questions like “how can we drive ROI?” you start looking for ways to push messages instead of starting conversations. When you push messages, you’re trying to tell customers what you want them to do. Save on interest payments with this lower-interest loan! Sign up for this rewards program! Instead of that, use your omnichannel reach to encourage your customers to answer questions, like where do you see your finances? Where do you want your finances to go? How can we help you get there?

Start with the understanding that most consumers don’t actually think the brands they do business with are personalizing their interactions, and most see their bank as a necessity rather than a partner. Change the narrative by asking direct and open-ended questions about their financial needs and their relationship with your bank.

Disclose in plain language how the information will be used, but don’t force the interaction down a few obvious funnels to generic loan products or other services. Instead, find ways to use those conversations to make truly unique offers to each customer. Marketing to a segment-of-one requires the use of facts, preferences, and behavior to help shape future offers on a unique basis rather than trying to slot every customer into a handful of pre-programmed types.

Ask, listen, and respond. It’s the surest way to deliver personalized experiences to customers. And the conversations you start are the real ROI in a world driven by consumer preferences and self-defined journeys.


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