Today, more data is generated in a 24-hour period than ever before - with 2.5 quintillion bytes of data created daily across the globe (IBM, 2017). And with 90% of the worlds’ data having been created in the last two years alone (IBM, 2017), it is clear to see that data will only continue to grow.
In this data economy, all kinds of businesses – from online retailers to pharmaceutical giants – are mining this wealth of information to better serve their customers, stay ahead of rivals and improve their bottom line. This task is no less crucial in financial services.
Indeed, this industry is inundated with data - ranging from bank transactions and mortgage applications to website, app and in-store interactions – and with each customer interaction conveying a message to businesses about what their consumers are doing. These messages are key to understanding what is and isn’t working in a marketing mix, and the challenge with this vast amount of data therefore lies in being able to integrate it, understand it, and turn it into actions that optimise the cost of customer acquisition, retention and lifetime value, whilst increasing leads, conversions and ROI.
For example, as bobsguide reported in 2015, retail banks are finding that taking advantage of their data has allowed them to retain customers and stay competitive with the emergence of challenger banks. It also gives them scope to personalise the customer experience, as potential clients turn away from their primary bank in favour of challenger banks with additional product services. (And this problem remains ever relevant today, with the emergence of companies like Monzo and Revolut who are shaking up the financial services industry).
In a recent survey by Econsultancy (2017), from a sample of almost 840 financial service and insurance respondents, over half (53%) said they are increasing their investment in marketing analytics in 2017. So how can companies ensure they are making the most of their end-to-end customer data, and are investing in the right technology?
In this three part discussion, we will outline how financial services businesses can harness the power of a Customer Data Platform, understand their customers, and gain actionable insights to optimise your marketing activities. Today provides a deep dive onto the key steps businesses must take to ensure they are capturing, and getting the most out of their customer data.
Capture every interaction
The path to purchase for financial services customers is no longer simple. Whilst they will still go through the stages of awareness, consideration, conversion and evaluation, this path is no longer linear, and consumers more often than not move back and forth between the stages – using multiple channels, devices and sessions as they do – as illustrated below.
Figure 1: The complexity of the customer multi-channel, multi-device journey
The problem with this increasingly complex journey is two-fold.
CAPTURE: Every customer interaction creates a data point that tells a crucial story about their path to purchase. But, with so many potential touchpoints, some businesses struggle to capture all of this data. From form interactions on your website that culminates in an in-branch meeting, or exposure to your brand from an affiliate through to engagement with an email campaign, businesses need to make sure they are seeing the full journey. Customer Data Platforms, which use the most advanced technology to collect and track data from all available sources, devices, channels and sessions – both online and offline, are key to optimising this process, and ensuring that every stage in the customer journey is tracked.
INTEGRATE: Even if you are capturing your customer interactions properly, most businesses store this valuable data in disparate data silos, meaning various channels and devices are viewed as separate entities, rather than ones that may influence one another. The result? Businesses that make decisions about one channel without knowing the effect it will have on another. Just as a Customer Data Platform is key in capturing each data point, these platforms are able to integrate and unify disparate data points, and break down these deadly data silos to produce a holistic view of the customer.
Figure 2: Data silos
Identify your customers
So step one in financial services businesses taking control of their data is to capture and integrate your disparate data sources. But integrated data is nothing if you don’t know who it belongs to. Stitching your various data sources together, and linking typically anonymised data (such as which affiliate website was used to enter your website) to known identifiers like an email address, is the necessary next step for businesses who want to fully understand their customers.
By doing so, multiple visits – across numerous channels, sessions and devices – are linked to one individual, so that financial services marketers can begin to understand who specific customers are, where they came from, what they viewed, and how they interacted with your channels on their path to purchase.
Understanding your costs
With this view of how customers are moving through marketing channels in place, businesses must look to gain an understanding of what each of these channels are costing – and which are bringing in revenue. Without this, they remain blind to what really matters in a business; spend and return on investment. For instance, take affiliate price comparison websites. Knowing that a customer has come to your website through this channel, and then re-engaged through a PPC or display ad, before applying for a loan is definitely useful. Knowing your overall marketing spend and revenue is also critical to optimising spend.
Being able to match specific customer journeys with specific costs and revenue data is critical when it comes to making decisions about your marketing mix, and understanding how your marketing activities influence your return on investment. A powerful Customer Data Platform will enhance your customer records by automatically ingesting your cost and revenue data and matching it to the corresponding user – providing financial services with a view of what each step in each customer journey is costing them.
Customer data is key to decision-making, and is playing an increasingly important role in the ability for marketers to improve their marketing activities. Unless this information is captured, stored and integrated effectively, financial services businesses remain blind to who their customers are and how they are interacting with their marketing channels on their path to conversion - and without this information, they will find themselves unable to create the foundation for more optimised omni-channel experiences.
In our next piece, we will take a closer look at how financial services can use this granular, single customer view of their customers to carry out accurate attribution by assigning the cost and value of each of these marketing touchpoints, in order to reduce the cost of customer acquisition and retention.