"Banking as an industry is generating [a] voluminous amount of data about customer transactions and behavior. Customers are actively engaged with the mobile channel where they check balances, open new accounts, make transfers, pay bills, deposit checks, redeem loyalty offers and a whole variety of waiting to be discovered use cases."
Big Data and Analytics Hero Deva Anamalai, sr. vice president of marketing technology and data insights at Zions Bancorporation, talks about personalizing the customer experience with big data and analytics.
How have big data and analytics impacted how you do your job today?
Thanks to Google’s papers on Map Reduce and Google File System the Hadoop ecosystem was born. IDC estimates big data will be a $24 billion market in 2016. Hadoop technology has revolutionized the concept of big data being applied in solving everyday problems for enterprises of all sizes.
Due to proliferation of various self-service and online channels, banking as an industry is generating voluminous amounts of data about customer transactions and behavior. Customers are actively engaged with the mobile channel where they check balances, open new accounts, make transfers, pay bills, deposit checks, redeem loyalty offers and a whole variety of waiting to be discovered use cases. Banks and financial institutions do a lot of "behind the screens" work to support these newer customer activities to be compliant with government regulations as well as monitor and fight fraud. All of these customer-centric activities generate a lot of data over a period of time.
The field of big data is heaven-sent for institutions which are fighting to conquer this piling amount of data to unearth insights in a reasonable amount of time. Hadoop technology is now mature and supported by a rich vendor and application ecosystem that allows marketers to harness the great potential of this technology that was once considered purely academic.
Thanks to big data, marketers and CX professionals have a better way to mine, manage and model data generated by customers and provide relevant, customized and personalized interaction experiences. This capability to personalize the customer experience builds loyalty if utilized the right way and helps to strengthen the brand, and ultimately the revenue bottom line.
How are big data and analytics changing your business strategy?
Businesses cannot afford to ignore the data collected from various customer actions. The next generation of customers prefers to interact using smartphones and other wearable technologies. This Internet of Things generates data which needs to analyzed and mined for insights to build the right business strategy. For businesses, data has become the currency of the future. Not investing the right amount of operational spend in understanding customer behavior will result in customer attrition.
Competition in banking is intense with a new generation of neo banks challenging the status quo. There are more than a 150 new startups, which were founded in the payments space in the span of last two years. All of these new entrants have realized the power of data and how to use analytics to provide value for customers.
The app economy has liberated customers to provide access to their data to independent entities that take on some of the traditional services offered by a bank. The PFM provider Mint.com is a great example where customers can aggregate their accounts from various financial providers to provide a 360-degree view of their finances. Mint provides financial advice based on this information. Banks will need to recognize and compete with big data enabled competition like this and provide customized services that will keep their existing customers loyal as well as attract newer customers. Big data and analytics are key to executing this business strategy.
How can big data combined with analytics improve the world we live in in 5 to 10 years?
Big data and analytics will be woven into the fabric of our everyday life. Wearable technologies like Jawbone’s UP and Nike FuelBand will monitor your sleep patterns to wake you up at the ideal time in the morning to feel fully rested. Your local coffee shop will know your preference for breakfast and will have it hot and ready by the time you arrive.
Your bank or financial management app will track your everyday spend and provide you with offers and deals in the shops you frequent so you get the best deal and stay within your monthly budget for shopping spend. This primary financial app will also give you pointers and take actions to save for your long-term goals by analyzing your financial habits. It will also monitor financial behavior of your family, check for fraudulent activities and provide early warnings about impending financial issues.
The Internet of Things will enable a smarter home which will utilize devices like the Nest Thermostat to adjust the heating, cooling and temperature settings in your home, saving on utility bills. Based on your TV viewing behavior, your connected entertainment device (like Apple TV) may make recommendations to get the correct TV and movie channels based on your monthly enternainment budget. Your refrigerator and smart pantry will keep track of your groceries and place an automatic order to grocery stores to replenish your supplies.
Ultimately, big data and analytics open up a whole new world of service providers who strive to create value in your everyday interactions to build brand loyalty. Once the customers experience the simplicity and value proposition being offered with this level of interaction, they become more comfortable opting in to share behavioral data and become your brand advocate. Organizations need to understand this truth to stay competitive and strengthen their big data and analytics capabilities to serve the next generation of customers.
View all of our Big Data & Analytics Heroes here on the Hub, and look out for next week's Hero: Sean Patrick Murphy, senior scientist, Johns Hopkins University Applied Physics Laboratory.