Navigating changing customer expectations in financial services

Key Takeaways

  • Customers understand the true value of their personal data and, as a result, increasingly expect something of value in return for sharing their data with brands.
  • Banks are well-positioned to profit from this new, more customer-centric dynamic because they are already trusted to keep data protected.
  • Banks can leverage customer data to provide value through context-driven, personalized digital communication, entering into a tight value exchange with the customer.

It’s no secret that Big Tech companies like Apple and Amazon have shifted customer expectations over the past decade. Frictionless digital transactions, next-day shipping, and other streamlined omnichannel experiences have become the norm across multiple industries. Companies that can’t deliver may already find themselves falling behind.

And the pace of change doesn’t show any signs of slowing. A slate of new developments — from the passage of data privacy legislation to the increasing accessibility of contextual computing — continue to power the evolution of customer expectations. Here are three developments banks should watch for and adapt to in order to meet the needs of their customers. 

Customers Demand Better Digital Experiences In Exchange For Their Data

A growing awareness of how Big Tech companies monetize personal data makes customers more conscious of the value of the data they share. Instead of passively accepting data collection as a matter of course, they expect companies to offer them something of value in return.

Customers also want to take back control of their personal data — and they increasingly have the tools to do so. Thanks in large part to data privacy legislation like the EU’s GDPR and California’s CCPA, many tech companies are introducing new capabilities that enable greater transparency and customer control. 

For example, in 2019 Google introduced a feature that lets users auto-delete location data after a set amount of time. Meanwhile, Apple launched tech that can measure some ad performance metrics inside its Safari browser, reducing the need for data to be sent to third-party adtech companies. As capabilities like these become more commonplace, the power dynamic between customers and tech companies is shifting.

That doesn’t mean that data sharing is coming to an end — far from it. By using customer data to create better digital experiences, companies can create a tight value exchange that benefits both the organization and the customer. Customers will happily opt into data collection that is safe, secure, and beneficial.

Banks are in a particularly good position to create this value exchange since they enjoy deep trust from customers. Seventy-eight percent of customers would share more data with banks in return for advice that fits their circumstances, according to Accenture. The question for banks is just what shape those benefits should take — and how best to deliver them.

Customers Expect Banks To Meet Them Where They Are — On Mobile Devices

Many banks see their mobile apps as mere self-service portals, which customers might use to check their balances or deposit checks remotely. However, that perspective sells apps’ potential short. 

Consumers live more of their lives online than ever before. Mobile apps are one of the primary ways people connect with friends and learn about the world. By leveraging mobile banking apps as digital communications channels, not just self-service portals, banks can deepen and strengthen customer relationships at scale.

A mobile app is cheaper, more scalable, and easier to personalize than third-party channels like email or direct mail. It’s also a channel banks already have — but they need to start using it to cut through the noise and communicate directly with customers. By collecting real-time data like location and mode of transportation, mobile apps can also make those communications more contextual and therefore, more powerful.

Smaller banks and credit unions may not have the resources to build a bespoke app from scratch, but that’s fine. Out-of-the-box solutions can be adapted to include content widgets and other features that power personalized digital communication.

Customers Tune Out Messages That Come At The Wrong Place And Time

When it comes to “personalization,” inserting a customer’s name into an automated email subject line is only the tip of the iceberg. Today, customers expect communication to arrive through the right channel, at the right moment — and to provide tailored information that’s relevant to them. In other words, they want messages to be contextual as well as personal.

For example, a credit card customer doesn’t want to see an offer for extra cash back on gas purchases when they’re sitting at home in the evening, unlikely to go out again. That message is more relevant and useful when they’re out during the day and close to a gas station.

To gain this benefit, the customer could opt to share some real-time contextual data with their bank. By anonymizing and tokenizing this data, their bank can derive insights from it without sacrificing the customer’s privacy or data security. Leveraging the resulting insights, banks can target relevant messages to arrive at the right time and place, reinforcing the tight value exchange. Contextual data from other sources, such as weather reports, can further refine such targeting.

The days of telemarketers calling during dinner or flyers shoved in an overstuffed mailbox are over. Banks that successfully leverage contextual data will ensure their messages integrate seamlessly into customers’ lives, rather than interrupting them. 

Customers’ Expectations Catalyze Change

Keeping up with customer expectations in financial services is challenging. Regulatory compliance and bureaucratic red tape can keep banks from adapting as quickly as companies in other industries. Banks also face difficulties integrating modern data solutions into their complex legacy systems. 

However, with help from the right partners, banks can effectively leverage customer data to personalize customer communication at scale — and deliver targeted messages at the right place and the right time. By creating a tight value exchange where customers see the benefit of sharing data, banks can strategically set themselves up for success in an era where customers demand more control.

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