By Nicky Peterse, Manager of Strategic Customer Success – EMEA, BlueConic
In the financial services world, customer loyalty can seem like a given. The average retention rate sits comfortably at 78%, with most consumers holding their primary bank account for over 16 years.
The tides, however, are turning. In Q1 of 2023 alone, 341,000 accounts switched providers in the UK – a staggering 70% increase compared to the same period in the previous year. Financial institutions must now ask themselves: how do we retain loyal customers while also attracting new ones?
The answer lies in an asset many banks already possess but often underutilise—first-party data. However, the true key to unlocking its full potential is not just having relevant data; it’s empowering marketing and growth teams with the right tools to access and act on it in real time.
Locking in loyalty
With 43 new challenger banks entering the market in 2023, consumers have more choices than ever. Economic uncertainty has also forced customers to rethink their financial relationships, creating a perfect storm for churn. In a world where many banks offer similar products, the battlefield for differentiation is customer experience.
Meeting modern customer expectations requires seamless, data-driven digital interactions. Whether it’s an intuitive app or an efficient online platform, customers crave self-service options that streamline their banking experience. And the data backs this up: customers who regularly use digital channels are significantly more satisfied than those who don’t.
First-party data enables banks to create resonant experiences that cater directly to individual customer needs – a clear advantage over competitors relying on shared third-party data. Yet, none of this potential can be unlocked without tools that technical teams can trust which comply with stringent privacy and regulatory requirements. Having a trusted platform, also gives technical teams confidence to enable marketing and growth teams easier access to relevant data and the ability to activate it without needing to rely on them. That’s the key to moving fast and meeting customer needs in real time.
Personalising every journey
Regional banks manage an overwhelming 1,500+ customer journeys, spanning multiple products, channels, and interactions. Miss the mark on just one touchpoint, and the customer’s perception of your bank can sour. According to Bain & Company, the more a bank personalises its relationship with customers, the higher its Net Promoter Score (NPS).
However, personalisation isn’t just a technical challenge; it’s an operational one. Marketing teams need a unified view of the customer that combines data from every system and source—demographic, behavioural, predictive—and they need it in real time. It’s not enough for data to sit in silos or for insights to come weeks too late.
For example, banks can identify customers whose five-year mortgages are about to expire and automatically trigger Facebook ads showcasing blog posts about refinancing options. This type of precision marketing can only happen when marketers have real-time access to unified data and the freedom to act on it without waiting for IT approval.
Cross-selling products and services
The holy grail for financial institutions is to cross-sell products and services in a way that builds loyalty—not frustration. Customers with multiple products are not only more profitable, but they’re also less likely to churn. But cross-selling has to be relevant. No customer wants to be bombarded with ads for a credit card they were just denied. Leveraging first-party data can offer them an alternative that better suits their needs.
Take the customer who just secured a mortgage on their first home. Chances are, they’re also shopping for home insurance. With the right tools to automate these connections, marketers can serve up relevant product offers quickly and easily without manual intervention. By empowering growth teams to build and deploy these strategies, financial institutions ensure that data is activated effectively and at the optimal moment.
Elevating customer interactions with next best action
Next-best-action (NBA) models powered by first-party data can elevate how financial institutions interact with customers. NBA uses predictive analytics to determine the best offer or interaction at a critical moment—whether it’s upselling a new product or resolving a potential issue before it escalates.
Yet, these models are often complex and data-intensive, which can slow down the process. That’s why simplifying data access is critical. When marketing and growth teams have the tools to run NBA models themselves – no coding required – they can deliver timely, personalised experiences without waiting for IT intervention or complex data integrations. Having the ability to calculate the NBA as your customers are browsing your website or app is hugely impactful. If you have to wait days or even minutes for a NBA to be calculated – the chances are your customer is no longer on your website and you are already too late with your NBA offer. Having agility is key in today’s competitive landscape.
Protecting privacy
For all the possibilities that first-party data offers, one thing must remain front and centre: privacy. In a heavily regulated industry like financial services, there’s no room for error when it comes to customer data protection. Any strategy must be underpinned by robust consent management, allowing customers to opt in or out seamlessly.
But privacy isn’t just about compliance—it’s about trust. Marketers need the ability to request and capture consent based on their objectives, such as collecting email addresses for personalised communications or tracking browsing behaviours to optimise website experiences. Transparency about how data is collected and used builds loyalty. When customers know their data is being used in ways that align their preferences, they’re more likely to share the relevant data companies need to deliver personalised experiences and develop long-term relationships.
Turning data into action
First-party data is one of the most powerful assets banks have at their disposal. But for financial institutions to stay competitive, it’s not enough to simply collect and store this unified first-party data. The real differentiator is empowering marketing and growth teams to access and use it to deliver resonant, timely experiences – without the need for technical intervention.
When non-technical teams have the tools and access they need to act on data, banks can truly maximise customer engagement, cross-sell opportunities, and retention efforts. In today’s fast-paced financial landscape, this agility isn’t a luxury—it’s a necessity.
