The importance of becoming a data-driven organization is not a new concept. A vast majority of banks and credit unions understand the fundamental need to let data drive decision-making, but a successful data-driven mindset still eludes many.
Financial institutions face challenges on their journey to become data-driven, but the key to success is actually quite simple: leaders who are ready to evolve alongside our ever-changing banking and technology landscape. Those who don’t are bound to encounter hiccups when trying to meet all the unique needs of their banking customers.
What prevents FIs from exploiting the data?
Banking institutions can face many dilemmas when trying to exploit their customer data, including the ever-evolving nature of consumer data tracking, massive growth in data volumes, and new privacy concerns. . The leaps and bounds of technological advances over the past decade can cause the target to shift steadily, although the end goal is always the same.
The biggest hurdle to overcome has nothing to do with data or the technology that tracks it, but rather with leadership and company culture. A primary juxtaposition between successful and lagging FIs is their ability to lead and adapt.
Adapting communication, services and platforms was a necessity at the start of the COVID-19 pandemic, but many organizations have done just enough to survive without purposefully using the power of their data or digital presence. As pandemic protocols have eased, consumer preferences for a digital experience have not. The reality today is that there is a new normal for digital banking, and it is up to banks and credit unions to welcome their consumers where they are in their financial journey.
A small minority of bank executives believe that digital communication, whatever it is, is too intrusive for their customers/members. As a consumer myself and as a provider of engagement technology for organizations that work with large numbers of consumers, this couldn’t be further from today’s reality. In our experience, only a tiny number of consumers opt out of receiving messages and offers, especially those that are meaningful to them. “Significant” often means communications based on data information.
Becoming data-driven means that financial institutions and their leaders are more than willing to accept the digital direction that the financial services landscape is taking, but actually embracing it. Financial institutions that have enjoyed success for generations are facing rapid changes in technology and consumer preferences, so to continue to be successful, they must finally implement digital capabilities they’ve dithered over for years.
As harvard business review points out: “While businesses may have paid lip service to the importance of data before, the case that good data is essential to making informed, careful and sound business decisions has been made clear over the past few years. last two years.
Becoming data-driven means a shift in an underlying mindset – data is good. Effectively using the data that banks and credit unions already have provides deep insights that allow them to understand what a customer/member wants and needs. Institutions can use the data to ensure that they provide the most relevant offers and messages possible to their members or banking consumers. To that end, leadership must prioritize actionable digital strategies to establish itself as a contender among the competition.
Today, there are technologies that can streamline and simplify the execution of digital strategies. Depending on the scale, FIs don’t necessarily need to think about big investments in data agents or digital analysts to get started. Another way to leverage their data in a way that offers strategic insights could be through an automation solution that can capture and use key data insights in a way that benefits individual consumers.
By taking an innovative, data-driven approach, banks and credit unions can pursue growth and longevity in a dynamic banking environment and deepen relationships with consumers at every stage of their journey. To drive this shift, banking leadership must grasp the tremendous value of executing data-driven strategies to thrive today.
Preetha Pulusani is the CEO of DeepTarget.