September 13, 2012

Financial institutions are adjusting the way they interact with consumers. It used to be that relationships were forged by a friendly face-to-face conversation in a branch. Now, those consumer connections happen across various channels: through telephone conversations, online banking websites and mobile devices.

The rapid pace at which the average consumer is changing has taken institutions by surprise. If we look at a recent Experian QAS study, we see that email is the most important marketing communication channel for 2012, followed by social media and traditional direct mail. It wasn’t too long ago that traditional mail was the most important channel for reaching banking customers. In 2012, digital platforms dominate the landscape.

The prevalence of all of those digital channels means that consumers are moving faster than ever. They now have unlimited information at their fingertips and they are bombarded by messages at all times through all channels. This situation creates two main challenges for financial institutions.

First, impressions solidify rapidly and decisions can happen in a very short period of time. Financial institutions need to understand the consumer and then capitalize on any interest before a competitor is able to do so. In addition, no matter the channel, institutions need to provide a personalized experience that creates a positive impression.

Second, businesses have to be agile and make decisions quickly. Institutions no longer have weeks to make the perfect offer. They need to understand the consumer immediately to prioritize high-value opportunities accordingly and provide relevant, personalized offers.

To overcome these challenges, financial institutions must evaluate how to create meaningful connections in new ways. Banks need to make interactions not only meaningful, but also consistent across channels so that the online banking customer still has the same personalized experience as someone in a branch environment.

Creating a consistent, personalized approach comes from having intelligence on the consumer. Part of the reason those relationships were forged in the branch is because a teller got to know the customer. They knew their children, their interests and their existing services with the bank, enabling them to make relevant offers.

Today, the consumer is moving faster, but online channels can often miss that personal touch. Banks need to gain consumer intelligence in real time so they can provide that personal experience.

To implement this type of customer-centric strategy, financial institutions need to review the channels in which they currently operate and the types of offers they currently make to consumers. Then, they need to consider how those offers or channels could be improved with additional consumer insight.

From there, they can implement a real-time data enhancement and modeling strategy that will allow them to clean consumer contact information as it is captured and then append third party information. That data can include demographic information, creditworthiness, life events and interests.

Institutions can then combine that information with internal data to create a personalized experience. Intelligence can be used to change website displays, prompt offers for certain services or help determine immediate follow-up communications.

For this type of dynamic decisioning to work, all of these processes must happen very quickly. But in today’s business environment, financial institutions need to figure out how to use the information available to them to create meaningful interactions with the customer.

Implementing real-time intelligence can help provide that personal, consistent experience across channels that will help banks forge new relationships and retain current customers.

Thomas Schutz is an SVP, General Manager at Experian QAS