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Hyper-Personalization Strategies for Banks to Scale CX

by Xebia India
Industry - Finance Domain - Digital Transformation

Making customer experience convenient isn’t enough for banks. Customers are looking beyond convenience and now want more personalized services suiting to their needs and demands. Agent-led banking model is rapidly shifting to digital-led banking system. Post the pandemic, the banking landscape is undergoing a transformation and now banks are adopting the latest technologies to stay competitive in the industry. Customer centric technologies are being exponentially adopted by banks and such new technologies and techniques have emerged to help banks crack the code for personalized services which aimed at acquiring and retaining customers for a long time.

The next phase of innovation in the banking industry will be focusing on creating and offering truly personalized products and services – services which are designed to address customer’s specific needs and goals. Hyper personalization is the next steps towards transforming the efficient functioning of banks

Customers these days get annoyed on receiving personal communications which don’t suit their needs. At the same time, a customer values offers that are relevant to him and suits to his needs. Banks thus need to focus on hyper-personalized services to boost revenues, foster customer loyalty and enhance customer experience.

Key benefits of hyper-personalization

High customer satisfaction is one of the key benefits with the hyper-personalization improvements. Other benefits include the following:

  • Target customer segmentation: Hyper-personalization helps in targeting the right customer as per the data collected and analysed. The data helps gain insights on customers through which they can be segregated based on his-tory, demographics, locations, and buying be-haviour. This in-turn helps banks better engage with its customers and offer services suiting to their needs.
  • Improved business results: Hyper-personalization results in personalized digital experiences improving revenues and cross-selling banking products. Further businesses witness a spike in outcomes as hyper personalization offers agile methods of customer segmentation and improved engineering of services.
  • Increased online/digital banking: As banks adopt more digital tools for banking such as mobile apps and enhanced websites, more customers are switching to convenient ways of banking and visiting banks less. Such channels offer hyper-personalized services based on usage history and provide better products and solutions for customers.

Steps to be undertaken while adopting hyper-personalized strategies and solutions

High customer satisfaction is one of the key benefits with the hyper-personalization improvements. Other benefits include the following:

  • Develop a vision: The first step towards the adoption of a hyper-personalization within a bank should be towards implementing a vision for customer engagement framework touching every point through the customer journey.
  • Establish business objectives: After the first step, banks need to access internally the current level of hyper personalization capabilities. Banks should be able to clearly outline the strategies for both short as well as long term to fulfil the objective of this step.
  • Project planning and piloting: Banks need to have a dedicated team working towards deployment of personalization solution. This team should test the hyper-personalization project on a limited basis before applying on a large scale. During the pilot phase banks should identify any ineffective reasons which could hinder the final implementation of the project.
  • Analyse feedback: After the final implementation, banks should continually analyse and
    collect feedback from its customers, team, and staff to maximise its hyper-personalization solution.

Application of hyper-personalization by banks

Hyper-personalization when implemented by a bank enables higher transparency, cross selling capabilities, increased innovation, and localization for optimum customer-centric solutions. Further, hyper-personalization is used by banks in the following ways:

  • Increase transparency: It is imperative these days for banks to have broader access to high-quality, real-time customer data to target customers in need of specific products at all appropriate times. Banks need to have transparency to capture all interactions across all channels to get a complete behavioural profile.
  • Enable cross selling: Banks need to break down their data silos and have cross functional collaboration to have customer-led strategies and enhance customer satisfaction. Hyper-personalization encourages open banking initiatives based on APIs which enables banks to better understand their customers.
  • Foster innovation: Personalization is forcing banks to undertake various initiatives to innovative. Banks are investing in hyper-personalization touchpoints such as smart phones, smart watches so that customers can carry them around and have access to it all the time. Such investments help banks to gather first hand information about their customers and their banking preferences.
  • Ensures localization: Banks should offer personalized services to its clients as per region and as per prevailing themes and necessities. While investing in hyper-personalized technologies, banks need to cater to the regional needs of its clients to be able to establish customer loyalty and better able to serve its clients.
  • Implement analytics: Hyper-personalization should be supported from the back end with other technologies such as AI/ML, analytics, cloud, APIs and customer data platforms and digital experience platforms for better and enhanced results. Such technologies help build models from historical behaviours, gain insights, and predict customer buying/ behaviour pattern efficiently.
Hyper-personalisation is thus a strategic imperative for banks. Banks that seize the opportunities of hyper- personalization and deliver true end-to-end hyper-personalised products and services are expected to stay ahead of their peers in the industry. Further, with the advent of technology, banks are realizing the benefits which personalization can bring when coupled with other cutting-edge technologies such as AI, ML, IoT, big data. Banks are now trying to cater to customer personalization while meeting the larger organization goal. IoT devices like smart watches, smart TVs and Internet-enabled home controls gather customer data which can be used to gather insights and be used in useful, convenient, and innovative ways of reaching customers with personalized content and recommendations. AI/ML application in banks for chatbots, prediction or experience-based models based on ML algorithms, segment target specific products are gaining prominence. Most of the banks are deploying such technologies to cater to individual customer requirements thus adding value through experiential banking. Banks are thus building an engaging digital layer where hyper-personalization and branch transformation can be significant to them.

Way forward with Xebia

Hyper-personalization when implemented by a bank enables higher transparency, cross selling capabilities, increased innovation, and localization for optimum customer-centric solutions. Further, hyper-personalization is used by banks in the following ways:

Xebia helps banks develop the roadmap from elementary to mature stages of personalization and optimization. It helps banks deliver with agility by building light, and innovate by scaling relevant digital solution. Its experience spans across digital onboarding, omni-channel banking, consumer lending, core banking systems, consumer banking analytics including data strategy/data pipeline/360 view, self service enablement, and open banking.

Xebia has a strong partnership ecosystem with Backbase, Iexceed, ACTICO, Mambu, helping banks accelerate their digital transformation journeys. Xebia provides banks with microservices-based Unified Digital Banking Experience through an omni-channel platform, which offers seamless end-user experience and helps enhance sales effectiveness and customer delight and satisfaction.

References

https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/financial-services/deloitte-uk-hp-the-future-of-retailbanking-1.pd
https://www.publicissapient.com/insights/hyper-personalization-the-key-to-growth-in-banking?msclkid=c907d90ecd2411ecb02c7ac7c44e0544
https://www.kasasa.com/exchange/personalization-the-key-to-the-future-of-banking?msclkid=c907f702cd2411ecbd7f4acee283f7a9
https://www.gi-de.com/en/spotlight/payment/6-ways-banks-can-increase-hyper-personalization-in-banking?msclkid=c905e58fcd2411ec82ccdd3b2c767ae8
https://blog.eisgroup.com/why-personalization-is-the-next-imperative-for-life-insurance-innovators/
https://www.linkedin.com/pulse/next-phase-banking-evolution-4x-mohammad-shahwaz/
https://www.cigniti.com/blog/hyper-personalization-digital-banks/?msclkid=c905bb8fcd2411eca138c3b397fa79c3
https://akabot.com/additional-resources/blog/hyper-personalization-the-future-of-retail-banking/?msclkid=4d683791cd1d11ecbb26d52bf46de5c3

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