The global banking and financial services industry is facing historic challenges but fortunately, banks now have transformational tools at their fingertips, including social, mobile, analytics and cloud (SMAC) technology. These powerful tools allow executives to adopt variable cost structures, increase revenue, improve products and services, expand market share and achieve nonlinear revenue growth. Banks that effectively use SMAC technologies to better understand and serve their customers are emerging as leaders in the industry and will continue to gain a competitive advantage in the market.
SMAC technologies enable banks to gain a more holistic view of customers in the following ways:
Social media helps banks engage customers on a more personal level and gain insights into their likes, dislikes, habits and physical whereabouts, enabling banks to deliver more targeted messages and provide individual support, ultimately boosting customer loyalty;
- Mobile technology allows customers to engage in transactions anywhere, anytime, increasing convenience for them and reducing branch costs for banks while also lending insights into customers’ on-the-go habits and preferences;
- Applying data analytics technology to crunch the trove of data gathered from customers’ social and mobile behavior enables banks to gain a more granular understanding of their customers’ preferences and serve customers based on these insights;
- Cloud technology provides the platform and infrastructure to deliver customized technology and services in real time. Leveraging cloud technology allows FSEs to collect and deliver data anywhere, anytime, at a global scale, while dramatically transforming fixed costs into variable ones.
The real power of SMAC technologies emerges when the four technologies are used together, giving financial institutions an unprecedented 360-degree view of each customer. For example, the data generated by users’ social media postings can be coupled with location-based data from their mobile devices, which can, in turn, be analyzed in real time on a virtual cloud platform. The explosion of data and analytics technology allows banks to store, manipulate, and analyze greater volumes of data and extract meaningful insights about customers’ preferences.
Combining SMAC technologies into an integrated approach transforms a bank’s ability to understand and meet its customers’ needs. This comprehensive view of the customer can be used to effectively engage existing and potential customers through tailored marketing strategies. Services and products can be presented based on customers’ preferences. Individualized sales and marketing strategies can help banks target different customers for easy mobile deposits, mortgage loans, small business loans, and so on.
Ultimately, this granular, 360-degree customer view made possible through SMAC technologies can improve the loyalty of existing customers, help banks engage these customers in new services, and increase the market share for banks by attracting new customers. However, even though many banks may have a mobile banking platform and a social media program in place, the technologies are siloed, obscuring a holistic view of the customer.
The fundamental question for banks of all sizes is how to achieve the multiplier effect and gain a granular view of their customers. The following steps are helpful starting points for integrating and leveraging SMAC technologies to achieve the multiplier effect.
Make the most out of the “easy data.” For starters, make sure you’re maximizing each opportunity to gather insights about your customers. Think in terms of the available background on customers from interactions and channels. For example, when onboarding new customers, configure your back-end system so the customer interface is easy to use and captures data effectively. Ensure the data follows the customers, so if customers have completed a credit card application, they don’t need to provide the same information for a mortgage loan.
Rethink customer service. Consider what types of end-to-end services can engage customers and improve their experience. Imagine, for example, a banking customer having trouble processing an online transaction. A truly integrated SMAC approach would let the customer dial into the call center where the client services person should be able to see exactly where the client is with the online transaction and help process it.
Challenge the norm. Continuously think about how you can develop services, products and experiences based on the insight gleaned from your customers’ preferences. Bring internal teams together and consider involving a specialized partner to share best practices from other institutions. Understand where you are today in leveraging SMAC technologies to gain a comprehensive view of your customers and prioritize where you want to deliver tailored services. The outcome of these discussions should lead to agreement on steps that enable eventual implementation.
Mr. Chintamaneni is senior vice president and global head of Financial Services at Teaneck, N.J.-based Cognizant. He can be reached at email@example.com.
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