Hyper-Personalisation: the Future of Banking

The increased need for an effective digital offering in the past two years has compelled companies to consider how to better serve their customers online. Consumers demand tailored offerings that deliver personalised services, products and pricing to their individual needs. Over the past decade, we have seen financial institutions give customers a limited number of personalised offerings like micro-segmentation, packaged products and services to increase customer loyalty and maintain their competitive advantage.

Consumer-led change

However, fintech companies are revolutionising banking with advanced personalised offerings which are incentivising traditional firms to develop better products and provide customers with an even better digital experience. Consumers are starting to call for a truly customised experience from their financial services including personalised offers, advice and alerts, as well as personalised products and services based on usage or behaviour.

Banks and other financial institutions are increasingly expected to deliver hyper-personalisation in a way that is similar to offerings in other industries. Traditional financial services firms have been slower to adapt to providing personalised digital experiences to their customers than industries like retail. Providing hyper-personalisation is currently a major advantage of digital-only banks and fintech providers. However, data-driven personalisation comes with its challenges. It is a fine balancing act between embracing data analytics, behavioural patterns of the user, respecting customer data preferences and choosing the right technology to help you reach your personalisation goals.

What is Hyper-Personalisation?

Hyper-personalisation uses real-time data and leading technology to generate insights on consumers. Behavioural science and data science can be used to deliver services, products and pricing that are context-specific and relevant to customers’ needs. These insights can be gathered using Artificial Intelligence which takes data from several sources and builds comprehensive profiles to make decisions accurately. The insights tend to be in the form of predictions or recommendations as you might see on Netflix or Amazon.

Hyper-personalisation is essential in a digital economy. As technology becomes a core part of businesses across many industries, advances in consumer experience capabilities and the processing of big data means that there are new opportunities for organisations to meet customers’ needs on a hyper-personalised basis.

Hyper-Personalisation in Financial Services

Financial services firms now have access to customer information that was previously unavailable which can help them to create a more personalised service. For example, with transactional history, additional tools can help them understand shopping habits, social media use, or customers’ location.

Banks can use hyper-personalisation to ensure their offers are more relevant to their users, so to create an experience that is similar to retail. Deloitte has predicted that customer experience will overtake price and product as a firm’s primary brand differentiator. Rapidly-evolving customer experience means that customers want interactions with their bank to be as sophisticated, immediate and personalised as their experiences with other industries. As a result, financial services customers are willing to share data as long as they receive offerings tailored to their needs.

Banks and Building Societies are particularly suited to adopting hyper-personalisation as they have large customer bases and a high amount of data per customer. Therefore, it is initially difficult to see what has prevented a faster and more widespread adoption of hyper-personalisation. While many financial institutions are investing in hyper-personalisation, there is no clear leader in personalised digital banking. The main reason is that true end-to-end personalisation requires developing new processes and skills. These include strong cross-channel offerings, cross-enterprise collaboration, a single view of the customer, and a new technology ecosystem; all of which are time consuming to build and implement.

Banks’ fragmented databases make it difficult to organise their data and create meaningful customer profiles. As a result, customers with different needs are sometimes offered the same products. In addition, legacy IT systems are often unable to measure responses or recommend next-best actions which are needed for hyper-personalisation. As a result, although many banks are developing personalised marketing capabilities, there is still some way to go for many institutions.

Final Thoughts

Hyper-personalised banking is becoming a necessity, with leading financial institutions seeking to transform how they interact with customers. Companies that achieve personalisation at scale stand to make significant performance and market share gains. Those institutions that adapt quickly and deliver genuine end-to-end personalisation will create a significant advantage over their competitors.

Mass personalisation in banking is a complex and challenging process, but a personalised financial experience is what drives people to become loyal clients. Tailoring financial services to meet clients’ expectations is a huge digital investment that requires time, efforts, and technological innovation.

How can we help?

ClerksWell have the skills and experience to take you on the journey to a truly customised experience. Talk to our team about using Sitecore or Umbraco to transform every online touchpoint with your customer to a personalised encounter. We can also help with the integration of legacy IT systems and databases and assist your organisation use Microsoft 365 to connect the digital experience of your customers with your employees.


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