Let’s talk about Iron Man—or, more specifically, JARVIS, the assistant that’s always in his ear.
Short for Just A Rather Very Intelligent System, Marvel’s depiction of JARVIS represents a serious upgrade from his original, human namesake: This JARVIS is powered by AI.
Like Iron Man, in the Age of AI, businesses within the banking, financial services, and insurance (BFSI) industry are getting their own newer, better JARVIS.
The customer management tools once known as Customer Data Platforms are quickly evolving into something much more sophisticated and powerful—something that will prove invaluable to businesses as delivering on the promise of hyper-personalization becomes the name of the game.
The need for personalization
Faced with the threat of imminent global destruction, JARVIS’s upgrade couldn’t have come at a better time for Iron Man and the rest of Marvel’s Avengers.
With the BFSI industry standing on the threshold of its own defining transformation, CDPs likewise represent a valuable asset in preserving humanity—or, rather, preserving the human relationships that have long characterized the industry.
As part of the next wave of digital transformation, businesses within the BFSI industry need to strike a balance by humanizing digital interactions. This means moving away from simply delivering your products via a digital funnel and instead focusing on the bigger context and the outcomes your customers want to achieve.
How do you discover what your customers want to achieve? The go-to answer among customer experience experts within the BFSI industry has long been a good ol’ fashioned customer survey. However, the challenges of customer surveys have been well documented.
- On average, just 7-10% of a business’s customer base will complete a survey.
- Surveys are inherently limited by a specific set of questions. As a result, businesses will miss out on valuable customer feedback on topics not covered in the survey.
- The one-off nature of surveys makes it exceptionally difficult for businesses to resolve issues proactively. Instead, they are forced to respond to issues as they happen.
According to McKinsey, leveraging an analytics-driven customer feedback system—such as a CDP—enables you to overcome these challenges and harness the power of data to dramatically improve personalization within your business.
Pushing the bounds of personalized marketing
Iron Man’s power comes from his robotic suit. But it’s JARVIS’s real-time feedback and recommendations that enhance that power and define Iron Man as a superhero.
With an almost unmatched amount of first-party customer data at their disposal, businesses within the BFSI industry are in much the same position: They have the power to create highly effective customer personalization, all that’s missing is the added edge that comes from a CDP-driven insights.
CDPs consolidate and process customer data, including demographics, behavior, and transactions, to create a single, unified customer view. This allows banks to understand each customer’s needs and behaviors to go a step beyond traditional marketing and interactions with the following:
- Creating informed product recommendations. By using a CDP to analyze customer data like browsing behavior and credit card transaction histories, you can generate hyperpersonalized product recommendations. For example, a CDP for a bank could help create a set of informed credit card recommendations for customers based on their individual needs. This could take into account everything from their current salary and credit history to their shopping behavior and saving habits.
- Optimizing marketing and communication strategies. As mentioned, different generations have different preferences when it comes to communication channels. To target customers more effectively, you can use a CDP to segment customers according to the channels they frequent the most and personalize their individual customer journey even further.
- Enhancing cybersecurity and risk management. The rise of AI is a double-edged sword: Identity theft and identity fraud have increased dramatically and, recently, Jamie Dimon, CEO of JP Morgan Chase, identified cybersecurity as the biggest threat facing the financial services industry. Fortunately, a CDP can help you and your business detect fraud by monitoring customer transactions and behavior for any abnormalities. Even more exciting, by harnessing the power of machine learning and AI, CDPs can also analyze historical data to perform fraud pattern analysis and provide insight into any vulnerabilities within your business.
In these ways, the right CDP helps you increase the value of your customer offerings directly with hyperpersonalized benefits that can be realized in real-time.
Enhancing operational efficiency
It’s with JARVIS’s assistance that Tony Stark runs the business behind Stark Industries, enabling him to spend more of his time protecting humanity as Iron Man.
Likewise, CDPs boost the operational efficiency of financial and insurance-related organizations by automating data management tasks and facilitating predictive analytics, creating the opportunity for businesses to focus on a new era of innovative personalized customer offerings.
Many organizations within BFSI, have cultivated the kind of distinguished reputation that can only come from a decades-long history. At the same time, longstanding institutions like these face a major roadblock as technology continues to advance: A lack of data hygiene and strategy.
In our experience, BFSI organizations excel at data collection. However, in order to leverage technology like AI, the quality of the data is key—not just volume. According to Accenture, the success of Generative AI in banking is contingent on a strategy that puts focus on data strategy and cloud infrastructure.
This is where CDPs can excel. They can improve data quality by deduplicating, validating, and cleaning data upon ingestion, which ensures high-quality data for marketing campaigns and other business operations. They also standardize data attributes for consistent use across different banking systems.
Most importantly, by creating unifying data and pulling together a comprehensive view of it, CDPs enable you and your business to:
- Improve operational efficiency. By automating tasks like data integration, segmentation, and personalization, CDPs can free up your team’s time to focus on more complex tasks, such as advising customers or developing new products and services. In turn, you and your team can use the insight of a CDP to enhance your own capability. For example, by offering more informed and personalized financial advice.
- Predict customer churn. Using machine learning, CDPs can help you analyze customer behavior to identify those who are likely to switch to a competitor. This enables you to target these customers accordingly, leveraging the more personalized offerings discussed in the previous section.
- Identify upselling and cross-selling opportunities. In addition to identifying potential customer churn, CDPs can also identify opportunities to sell additional products and services both by drawing upon customer data and by conducting cohort analysis. For example, a bank could segment those customers who are most likely to repay a loan and earmark them for additional services.
A more intelligent path forward
As any Marvel aficionado already knows, JARVIS’s role eventually evolves far beyond that of personal assistant to Iron Man. After being uploaded into his own android body, JARVIS becomes Vision, a superhero in his own right.
As CDPs continue their own evolution, it won’t be long until they evolve into something new as well. It’s not unrealistic for CDPs to be rebranded from “Customer Data Platforms” to “Customer Intelligence Platforms.”
By harnessing the power of CDPs, banks and other financial institutions can transcend basic customer interactions to achieve unprecedented levels of personalization and operational efficiency.
Moreover, it’s clear that in an increasingly AI-powered landscape, CDPs—or, rather, CIPs—will only become more and more critical in ensuring sustained loyalty and competitive advantage in the market.
Questions?
CTO – APAC & DEPT® Adobe Practice