How to Create Personalized Digital Banking Experience for Your Customers?

In this article, we will cover what personalization means for banking, the benefits of implementing it, and how to do so successfully.

How to Create Personalized Digital Banking Experience for Your Customers?

Personalization is the future of banking. It may not seem like it, but personalization plays a crucial role in improving banks’ conversion rates and revenue growth. With many obstacles standing in the way of adopting this strategy, how can banks overcome these challenges? In this article, we will cover what personalization means for banking, the benefits of implementing it, and how to do so successfully.

There are five different use cases that you should consider when planning your digital transformation initiative: UX Personalization, Content Personalization, Data Lake Management System (DLMS), Advanced Analytics Tool Sets, and finally a Roadmap for Digital Banking Personalization Initiatives which gives an overview of all aspects involved with successful personalization implementation.

What Does Personalization in Banking Really Mean?

Personalization is the practice of tailoring a service or product to suit an individual’s preferences, needs, and tastes. In banking, this translates into offering customers more personalized interactions with their bank – tailored products that they are likely to be interested in; customer-centric services designed for each client’s specific requirements, which are communicated through relevant messages delivered at opportune moments throughout the day; increased cross-selling opportunities from both within a single company and across different banks. The goal here is not simply to offer certain “premium” customer segments special treatment, but rather tailor everything about how your organization interacts with them to optimize conversion rates and maximize the revenue return on investments.

How Banking Personalization Boosts Revenue Growth

Banking personalization helps increase conversion rates for banks because customers are more likely to get the services they need from a bank that offers them personalized products and services. According to Mckinsey & Company, personalization can drive up to 15% revenue growth for companies in the financial sector. Additionally, 46% of millennials value personalization using preferences and contact info.

Implementing banking personalization will also help you reach new audiences while still giving existing ones what they need. As new segments will be engaged with your bank while the ones currently on board are still being served. The key is to know what segment you want to target to reach a larger audience and have an easier time generating conversions without compromising the quality of service or revenue generation potential.

What Obstacles Are Preventing Banks From Adopting Personalization?

Many challenges prevent banking organizations from implementing personalized services such as:

  • Lack of cross-company collaboration (which could result in customer dissatisfaction)
  • Difficulty connecting data sources (due to regulatory restrictions)
  • Inability to deliver relevant messages,  timely
  • Difficulties scaling up initiatives beyond one’s own company

These all represent significant barriers for any organization looking into this strategy. Fortunately, some steps can help overcome these obstacles to make the journey towards banking personalization more feasible.

How Can Banks Overcome These Challenges?

The first step is not just recognizing the importance of personalization, but also understanding its value regarding profit or as a competitive advantage for your organization. This will be key to getting executive buy-in and being able to rally others within your company around it, too – including those who might not see any tangible benefits at this stage because they are focused primarily on internal profits rather than customer satisfaction (and higher revenues).

Harnessing the Building Blocks of Personalization

One way that organizations have been overcoming these barriers has been through partnerships with third-party firms, which provide them with data management solutions – such as managing their data lakes, providing advanced analytics capabilities, and helping them design their digital banking experience.

Meeting customer needs

The next step is to make sure that your organization understands what its customers need in terms of personalization. After all, it’s about meeting those individual needs rather than just delivering a one-size-fits-all approach that might not be tailored enough for any given segment.

Overcoming the data paradox 

This requires overcoming the “data paradox” to get insights into what segments you want to target. And then getting more detailed datasets on these specific groups so that you can tailor products or services accordingly, from both within a single company (to improve conversion rates) as well as across different banks (to help generate higher revenues).

A Roadmap For Digital Banking Personalization Initiatives

When you have a clear vision of what needs to be done, it becomes easier to work with stakeholders within your organization and get buy-in from executives as well. For this reason, the next step is to come up with an action plan. It will help overcome these challenges to move towards the successful implementation of personalized services.

One key aspect of such a roadmap should include identifying which goals are important enough for your company’s larger strategy (and how they align with other organizational objectives). So that everyone understands why implementing banking personalization is necessary right now. Even if some benefits won’t start coming through until later on down the road.

Data lake 

The first thing we recommend doing when building your roadmap is to consider the data lake as a crucial element in your strategy – because it will provide you with rich insights into how customers behave and their needs. It’s all about using advanced analytics capabilities, connecting disparate sources of information, and applying machine learning techniques on top of that. It will generate more accurate predictions around customer behaviour (which can then be used for both personalization initiatives within one company or across different banks).

Advanced analytics

The second aspect we recommend incorporating into your roadmap is advanced analytics. This will help identify opportunities related to profit creation by building personalized products or services from within a single organization. And also supporting out other organizations looking into similar strategies through shared resources, such as marketing campaigns.

Digital banking experience

The third key area we recommend including in your roadmap is the design of a digital experience that can meet customer needs. This can be done by adopting user-centric approaches, looking at past behaviour to see how customers behave and interact with each other, investing in immersive experiences (such as virtual reality), and more. This will help create a personalized experience for individual customers while also helping them find answers to their questions more quickly through service optimization techniques such as chatbots or AI bots which provide automated responses based on what they’ve said before.

UX personalization

One important way to create a personalized experience is through UX personalization in which the organization can provide customers with tools that help them navigate complex services – by organizing information into intuitive steps, providing context-sensitive guidance (such as highlighting relevant branches for bank accounts), or enabling self-service options.

Content personalization 

The final area we would recommend incorporating into your roadmap is content personalization – because it’s all about making sure you have relevant and engaging content at all times. This will ensure users stay on your digital channels longer to find what they need. It also means empowering employees within one company (or across different ones) with the right skill sets, such as copywriting, design, video production, etc. So that they’re able to create content that resonates with customers and thereby create a more personalized experience.

A Thought to End On

It takes a lot more than just a personalized campaign to move forward with banking personalization initiatives within an organization. You need buy-in from senior executives, clearly defined goals and objectives, and a roadmap that includes all aspects necessary for success (including data lakes + advanced analytics). But once you have this foundation in place, there is no limit to what can be achieved regarding banking customer satisfaction!

If you are looking for a reliable software partner, InvoZone is the best place for you. We offer Fintech consulting and development services to clients across the globe. Do not hesitate to contact us!