I’m probably not the only person who receives multiple credit card offers each month from the very same institutions that unsuccessfully sent me similar offerings in the past. Why do banks believe I’ll eventually sign up for their cards if they just send enough of the same offers?
Albert Einstein once said that the definition of insanity is doing the same thing over and over and expecting a different result. I call this the Insanity Principle.
This principle seems like common sense. But I continue to see banks run marketing campaigns that approach their customers the same way year in and year out. Even worse, I now get these impersonalized, “one-size-fits-all” offers that do not take any of my personal preferences into account through multiple distribution channels.
Attracting Customers in the 21st Century
Is this the best we can expect from banking in the 21st century? Certainly not. Banks should look at the retail industry, among other sectors, to learn how they can improve cross-selling ratios, deliver real-time offers that reflect and address customer preferences, and develop individual pricing strategies that take into account factors such as customer segment, channel, relationship, and transaction history as well as seasonal and promotional considerations.
I do not want to suggest that everything banks are doing with respect to customer relationships is inefficient. My point is that the industry can do much better. It’s not rocket science, especially given the fact that banks have all the data they need to customize their offerings — as well as the technology to enable real-time or nearly real-time analysis of that data.
Leveraging Available Data and Technology
Information is the lifeblood of business today, especially when supported by flexible analytic models that help organizations uncover new market patterns and trends.
In traditional analytics, high data volumes require assumptions during modeling to reduce data sets to a manageable size. But such simplified models usually don’t accurately reflect the multifaceted nature of operational data and often produce sub-optimal results.
The latest generation of in-memory analytics solutions available for gaining instant insight into business operations are flexible, multi-purpose and data-source agnostic. They can help banks, analyze their massive volume of data in real-time and thereby quickly respond to rapidly changing business conditions.
Another aspect is to make data more accessible than ever before through easy-to-use modeling tools that further increase business-user autonomy.
Through semantically enriched views that turn raw operational data into understandable relevant information, business users can create new analytic models in a Web-based environment to suit their particular needs. An environment of guided data discovery can enable intuitive data exploration and interactive data visualization.
Banks must become more customer centric, both from a business and IT perspective, to compete successfully in today’s environment. To know your customers is thus becoming more critical. Technology can help banks understand customers and anticipate their needs.
It can help banks take steps to treat customers as individuals and make them feel important and appreciated. Would it not be great to see banks actually deliver on what is promised to us in well-done TV commercials rather than receive impersonal offerings that do not address our individual preferences or situation?