Banking customer engagement: Using data analytics to build personalized relationships

Business and Technology Writer

Everybody wants to feel that someone is listening to their wants and needs. When it comes to customer engagement, data analytics can help banks understand consumer desires and preferences. There are patterns and details within the vast quantities of data banks are already collecting. Banking analytics can help you identify and respond to what your customers want today, and even anticipate what they'll want tomorrow.

Data analytics is a vital tool for customer retention, product or service improvement, upselling and client acquisition. It helps banking leaders and marketing teams connect with their current users and the next generation.

Transaction data define marketing opportunities

So much of what your user base has to tell you comes from how they already engage with your banking services already. By analyzing information about how your consumers access and consume content and applications, you can build marketing strategies around the devices, locations and functionalities they already prefer.

Retail banking analytics can uncover customer behavior patterns that reveal impending live events, such as retirement, shopping for a new home or a baby on the way. That's the kind of personalized information that helps retain clients, and it also creates opportunities to promote a cross-sell or upsell tied to the life event. In these instances, a customer may be primed for a fresh look at investment or banking services.

Data analytics opens windows to clients' wants and needs

You can make your customers feel cared for by leveraging data about their unique situations and preferences to create an even more personalized banking experience. It can also help you identify ways to cross-sell and upsell to certain demographics. For example, a recent Financial Planning report showed that baby boomers are most likely to download personal finance applications. Meanwhile, Gen Xers take the lead in selecting digital wallet and wealth management applications. Data analytics brings the insights from these apps to the forefront, informing banks' new product strategies for their target audiences.

Look to social media"While demographics and current product ownership are at the foundation of customer insight, behavioral and attitudinal insights are gaining in importance as channel selection and product use become more differentiated," writes Jim Marous in The Financial Brand. "Sentiment analysis and social-media analysis are two additional examples."

If you want to identify which customer micro-segments are well-positioned to respond to your next marketing campaign, use data analytics to highlight patterns in social media. These can include common life event discussions, seasonal behavior, consumer feedback, product discussions, requests for new services and recommendations of your company. You can also track these customers' locations, professions, activities and networks. In each of these micro-segments, when a bank creates messaging that's meaningfully aligned to users' interests and plans, established customers will notice the highly personalized attention, leading to positive social buzz. Satisfied customers spread the word.

Mine a broader vein of data

Another approach banks can take is to "acquire customer data they don't have from external sources, matching that data to records in the bank's master customer information files," observed Jerry Rackley, Demand Metric Chief Analyst and author of Marketing Analytics Roadmap: Methods, Metrics and Tools in a recent interview. One approach would be to use census data, rich with details of home ownership, employment and the average ages in a region. For example, banks can use this to reach out to customers in rental housing who might be ready to buy their first home.

Data analytics is a window into clients' wants and needs. With it, banks can make personalized outreach more compelling and effective than ever before. They can extend an invitation to become a new customer, to continue as a loyal user or to expand the spectrum of products and services in an existing portfolio. Learn more about leveraging analytics in banking to maximize customer satisfaction, loyalty and retention by signing up for a live demo of the industry-specific predictive analytics solution.