Covid-19 forced banks to cut in-store customer support, leaving clients with limited access to learn about their banks, complete onboarding processes, and ask for financial advice and products.

Neo banks stepped in to cater for what felt like a growing gap between what banking clients needed at the time and how banks dealt with their demands. This has brought forward the need for financial institutions (FIs) to diversify their digital banking solutions and deliver targeted content for their clients.

Nowadays, incumbent banks are faced with an increasing number of challenges coming from neo banks, who are in a much better position to deliver personalised content.

Customer experience involves pragmatic trade-offs. Clinton Abbott, vice president of Product Management at SunTec Business Solutions, is no stranger to that.

He tells RBI that banks must track customer satisfaction and balance cross-sell opportunities to deliver what is best for their clients. His company, SunTec is a pricing and billing company providing cloud-based products to enterprises.

By adopting hyper-personalised content, Abbot says, banks can build stronger relations with their clients and drive greater engagement and loyalty.

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By GlobalData

Q: Why must banks optimise their data to deliver hyper-personalised services to their clients?

Clinton Abbott, VP of Product Management at SunTec Business Solutions: Banks in today’s digital age have access to a vast amount of data that is rich in behavioural information. When leveraged in the right way, this data can help banks gain a deeper understanding of their clients and deliver highly personalised products and services that meet their specific needs and expectations.

By adopting a hyper-personalised approach, banks can build stronger, more meaningful relationships with their clients, driving greater engagement and loyalty. By linking personalised products and services and offering tailored advice and solutions that align with their clients’ individual circumstances and goals, banks can create a sense of trust and confidence essential for long-term success in the financial industry.

Moreover, using data-driven insights can enable banks to stay ahead in developing new products and services tailored to customers’ future needs. By staying in tune with evolving customer preferences and behaviour patterns, banks can identify emerging trends and opportunities and act quickly to capitalise on them. This can help them stay competitive in an increasingly crowded marketplace and maintain their position as a trusted and reliable financial partner for their clients.

In summary, the ability to optimise data and deliver hyper-personalised services is a key factor in the success of modern banks. By leveraging the wealth of data available to them and using it correctly, banks can deepen their relationships with clients, drive greater engagement and loyalty, and ultimately increase revenue and profitability.

Q: How do you assess banks’ performance when providing hyper-personalised services to their clients?

Abbott: Assessing banks’ performance when providing hyper-personalised services to their clients can be done through various methods, including customer satisfaction surveys, measuring customer retention rates, the balance of cross-sell opportunities realised and natural revenue growth. Here are some key performance indicators (KPIs) that we have found that can be used to measure the effectiveness of a bank’s hyper-personalised services:

  • Customer satisfaction: Banks can use customer feedback surveys to measure how satisfied their clients are with the personalised services they receive. This enables banks to “tweak” their service or product to better meet the customers’ need. This should be the starting point towards a dialogue in offering the customer a better-suited product or enhanced service.
  • Customer retention rates: Banks can track how many clients stay with them over time and how many are leaving, indicating how well they are meeting their clients’ needs. Customers are usually multi-banked; identifying behavioural changes (salary no longer being credited to the account) can show that a customer intends to move banks. It could also mean that the customer is undergoing a change (loss of job), and the bank could assist the customer in their transition.
  • Balance of cross-sell opportunities: Monitoring the uptake and adoption of recommended products and services by customers can help banks identify areas for improvement in their cross-selling strategies and provide more targeted, hyper-personalised solutions to their clients. By analysing the success of these recommendations, banks can identify which products and services are most relevant and beneficial to their clients, enabling them to prioritise their offerings and personalise their services accordingly.
  • Revenue growth: By tracking revenue growth, banks can see whether their hyper-personalised services lead to increased business and revenue by specific customer segment groups, products, and/or services. Working on granular reporting can provide better insight into their high-revenue portfolios.

Q: What are the challenges banks face when trying to deliver personalised content?

Abbott: There are several challenges that banks face when trying to deliver personalised content:

  • Uptake vs Adoption: Banks must measure success by focusing on the number of customers who have started using a product or service after signing up for it rather than just the number of customers who have shown interest in it.
  • Data privacy and security concerns: Banks must comply with stringent data privacy regulations such as GDPR and CCPA when collecting and analysing customer data and ensure they obtain customer consent for data collection and processing.
  • Limited access to appropriate data: Banks may not have access to all the data they need to provide personalised services or the data they have may be inaccurate, outdated, or contextually irrelevant.
  • Resource constraints: Implementing hyper-personalised services requires a significant investment in technology and personnel, which can be challenging for smaller banks.
  • Balancing personalisation with automation: Banks need to find a balance between using automation to efficiently deliver personalised content and ensuring that the content is still meaningful and relevant to the customer.
  • Customer expectations: Customers increasingly expect a higher level of personalisation from their banks, which can be difficult for banks to meet.

While this list may not cover all the challenges, it does offer a broad level of guidance that banks must consider when navigating these obstacles to provide efficient hyper-personalised services that cater to customer requirements while also managing regulatory restrictions, fintech rivals, and maintaining data privacy and security.

Q: You are the senior vice president of Product Management at SunTec, a provider of cloud-based services to businesses. How has demand for your B2B products changed since Covid happened? Did the pandemic have an impact on the products banks are asking for?

Abbott: The banking industry, like many others, has been significantly impacted by the COVID-19 pandemic. With the shift towards remote work and social distancing, the demand for digital banking solutions has grown rapidly, forcing banks to adapt quickly to changing customer needs and expectations.

This transition towards digital banking has also increased the need for B2B products that can help banks manage their digital services and enhance their customer experience. SunTec Relationship-based Pricing Management, available on the SunTec Xelerate platform, complements and significantly enhances existing core banking capabilities, enabling contextual pricing. As an enterprise pricing master, SunTec Xelerate provides fairness, transparency, and control for all stakeholders while also improving revenue. The rule-based capability further automates the pricing process, improving agility, maintainability and enabling end-to-end auditability and traceability.

The pandemic accelerated the adoption of digital banking solutions, and B2B products like SunTec Relationship-based Pricing Management are vital in helping banks meet the evolving needs of their customers. Our hyper-personalised solutions allow for a “personalised touch” to become the “digital representative” of banks, offering tailor-made solutions that customers would have previously expected only through lengthy face-to-face negotiations with banking representatives. With pricing brought to the forefront of customer engagement strategies, banks can create an enterprise pricing master for fees, rates, and charges that win the hearts and minds of their customers.

Q: What is dynamic and micro-segmentation in banking, and what role should they play when delivering personalised content to their clients?

Abbott: Dynamic and micro-segmentation are both strategies that banks can use to deliver personalised content to their clients.

Dynamic segmentation involves categorising clients based on their current behaviour or needs, such as recent transactions, account balances, or products used. Banks can use this information to tailor their communications and offers to each customer based on their current needs.

Micro-segmentation takes this further by creating smaller, more targeted segments based on specific customer attributes such as age, income, and spending habits. By creating these smaller segments, banks can deliver even more personalised content to their clients. We see this as the foundation for achieving the much sought-after “Segment of One”, where the tailored offer is absolutely built for that individual customer without compromising and adding back-office complexity.

Dynamic and micro-segmentation are both critical strategies that banks can use to deliver personalised products and services to their clients. By understanding their clients’ behaviour and needs, banks can create smaller, more targeted segments to deliver relevant and timely communications, offers, and recommendations. With accurate and up-to-date data and the right technology in place, banks can provide customer choice and deliver tailored offers that meet their clients’ needs and expectations.

A good illustration of implementing these strategies can be seen in the credit card industry, where personalised offers are directed to clients based on their spending patterns. These targeted offers are tailored to meet the customers’ needs, allowing them to take advantage of relevant offers.

SunTec Dynamic Offer Management, available on the SunTec Xelerate platform, is a cloud-based middle-layer platform that seamlessly integrates with the bank’s existing technology landscape, offering a highly configurable offer management capability that enhances customer relationships, reduces time and cost to market, and propels growth through up-sell and cross-sell capabilities. When implementing these strategies, banks must ensure that they have access to accurate and up-to-date data and the right technology and analytical tools in place to deliver personalised content in a timely and relevant manner.

Overall, dynamic and micro-segmentation can play a critical role in improving customer engagement, loyalty, and satisfaction for banks, ultimately leading to increased revenue and growth.

Q: Should generative AI play a role in delivering customised content to their clients?

Abbott: In my view, generative AI can play a role in delivering customised content to clients, as it can potentially create personalised and unique content on a large scale. This technology can analyse vast amounts of data to identify patterns and insights about individual customers, which can then be used to create personalised content, such as recommendations, offers, and even direct communications.

Generative AI can also be used to create more engaging and interactive content, such as personalised videos and animations, which can help improve customer engagement and satisfaction — even teaching how to utilise certain channels, products and/or services. Additionally, it can help to automate content creation, reducing the time and resources required to create multiple variations of personalised content manually.

However, it’s important to note that generative AI must be used with other strategies, such as dynamic and micro-segmentation, and must not replace human interaction and customer engagement. It’s also crucial to ensure that ethical considerations, such as privacy and data security, are taken into account when using AI to deliver customised content to clients. Overall, AI can be a valuable tool, but it should be used responsibly and in a way that enhances the customer’s experience and doesn’t bring the interactions into question where customers doubt where a human touch is indeed taking place.

Q: If you sum up what we have discussed, what are the challenges and opportunities for the banking sector when delivering personalised content to their clients?

Abbott: The banking sector faces both challenges and opportunities when it comes to delivering personalised content, products and/or services to their clients.

One of the biggest challenges is managing and analysing vast amounts of data to gain insights into customer behaviour and preferences. Banks must ensure that they have access to accurate and up-to-date data and that they have the right technology and analytical tools in place to make sense of the data.

Another challenge is the need to balance personalisation with regulatory, privacy and security concerns. Banks must ensure that they are protecting their clients’ data and privacy while still delivering personalised products, services, and content.

On the other hand, the opportunities presented by delivering this level of hyper-personalised offers to clients are significant. We have proven that personalisation can help to improve customer engagement, loyalty, and satisfaction, ultimately leading to increased revenue and growth for banks. Personalisation can also help banks to differentiate themselves from their competitors and to stay ahead in an increasingly crowded market.

To take advantage of these opportunities, banks must be willing to invest in the technology and infrastructure needed to deliver personalised content effectively. They must also be willing to embrace new strategies and technologies, such as AI and dynamic/micro-segmentation, personalised offer management, to stay ahead of the curve.

Overall, the challenges and opportunities ahead for the banking sector when it comes to delivering personalised products and services to their clients are significant. By investing in the right strategies and technologies, banks can create a more personalised and engaging experience for their clients, ultimately leading to increased revenue and growth.