“Data, I think, is one of the most powerful mechanisms for telling stories. I take a huge pile of data and I try to get it to tell stories.” — Steven Levitt, Co-author of Freakonomics
Data — everyone knows it’s valuable, but many financial institutions (FIs) are missing out on opportunities because they’re not tapping into just how valuable their data can be.
How you store your data matters
The problem isn’t a lack of data. FIs have a vast repository of information on their account holders. The issue is that data is often stored in different places because various account holder needs are often handled separately. This leads to a disconnected view of an account holder, making it harder to customize messaging to meet their current needs, and especially difficult to accurately predict their future needs.
‘Dial up’ the effectiveness of your analytics
An FI’s existing central reporting can meet basic customer relationship management (CRM) and audit needs. However, relying on traditionally available customer data, such as age and wealth, to predict customer preferences, can be overly simplistic and poor predictors of actual behaviors. With the right data tools, your institution can begin more accurately predicting whether an account holder will need a car loan, refinance their home, or set up a debit card. The possibilities are endless.
According to an Ernst & Young Consumer Banking Survey, “With deeper understanding, financial institutions can identify what customers need and want in their financial engagements, prioritize investments into customer experience enhancements, redesign outdated processes and create innovative, intuitive digital experiences.”
Consider the increase in revenue possibilities, as well as better security and fewer operational headaches, if account holder data from your digital channel is used in conjunction with machine learning and behavioral modeling. For example, using predictive analytics and behavior patterns to prevent fraud for your account holders can increase the trust an account holder has in your FI and make them more likely to have a conversation or consider a future product offer.
You have the data already-it’s just a matter of employing the right data tools to help you better understand, and ultimately better serve your account holders’ evolving financial needs. To learn how your FI can get the most out of your data, read our Five Operational Imperatives to Fuel FI Growth handbook.