What core priorities and challenges do Financial Services marketers face when looking to deliver a data-driven experience? VP Financial Services, Chris Vinnicombe explores.
Who are you and what do you do?
My name is Chris Vinnicombe and I lead the Financial Services practice for Acxiom in Europe.
What priorities do Financial Services marketers have in creating a data-driven experience?
Through talking to some of the larger financial institutions and through some research that we’ve undertaken, there are some major initiatives at the moment to drive out some of the internal inefficiencies when it comes to technology specifically.
The other items are stopping the attrition of current account customers to some of the neo banks. In order to do this, they’re focused on providing a better experience to their customers.
So in addressing these main concerns, a lot of companies are focused on the better leverage of data. You could argue that Financial Services companies have always leveraged data, but I think what we’ve seen in the recent year or two is more of a doubling-down on their existing data assets to really make sure that they are understanding their customers as best as possible.
From what our research tells us, 89% of senior executives believe that data is a key investment area. 92%, however, of senior management recognised that those companies who take best advantage of data will be the ones that win in the marketplace with consumers.
What challenges do Financial Services marketers face in creating a data-driven experience?
The main one that we’re seeing and that the banks are seeing is that consumer expectations are always evolving, but now they’re very different. There is an expectation for freemium service. So if banks want to move into the more subscription-based services, they’re going to have to create an experience that has significant value that’s recognised by consumers.
Consumers also expect a frictionless experience when dealing with their bank. This is difficult because there’s always a balance that needs to be created between making sure that that interaction is safe and secure, and also compliant. But more and more, consumers don’t want to remember multiple passwords and security passwords. In addition to this, new legislation is both opening up opportunities for data through the open banking regulations, but it’s also restricting and limiting the use of specific applications of data through things like GDPR. The challenge there is; how do you create solutions and systems that are both manageable but also future proof?
The amount of data that’s now available in the marketplace and that consumers are producing has exploded in recent years. The cost of managing this data has increased exponentially. From our research, 82% of Financial Services companies manage this data in-house. So it’s no surprise that with recent technological developments that there’s a move to a cloud-first approach to managing data. The difficulty here is that this is neither easy to do, it’s not without risk, and it’s not going to happen overnight.
What steps can Financial Services marketers take to differentiate with data?
First of all, Financial Services companies will need to connect together all of the data that they have.
We still hear on multiple occasions banks saying to us, ‘we have multiple single customer views’. Which sounds like an oxymoron, but it’s actually commonplace everywhere. Companies need to connect together data across silos, offline and online, and across anonymous and known where that’s possible to do so.
The second part of this is once you’ve connected everything together, is you’ve got to identify your gaps. Where is your data strong or where could it be supplemented? We’re not advocating here that third-party data, like geo-demographic data, is more predictive than bank’s transactional data, but it can help fill the gaps and help companies understand the drivers of transactional information.
Once this understanding is attained, companies can better predict what Financial Services products these customers might need in the future.
Following on from this, there’s the need for deep analytics, taking advantage of continuing evolving analytic capabilities in the fields of machine learning and AI, but really insights don’t mean anything without action. So it’s core to be able to activate this data wherever the consumer happens to be consuming their advertising.