How financial services are missing the mark on tailored outreach

While all sectors strive to perfect their personalized approach to customers, the same journey in financial services seems to be lagging behind. While rich in data, funding, and technology, personalization can often seem low on the priority list. So why does the financial services industry have so much catching up to do, and how can it take the lead? James Breeze, Principal Consultant for United KingdomExplain.

On paper, FS is an obvious industry to use customer data smartly. He’s certainly had enough. Think about your bank, your mortgage lender, your auto insurer. They know a lot about you – how much you spend, how often, and whether your income and expenses match.

We know that effective personalization drives customer satisfaction and loyalty and upsells additional services. So why aren’t banks and building societies making the most of it?

There are four main reasons why the financial industry is struggling to lead the charge in personalized customer outreach:

Risk aversion

Banks spend all day, every day looking after people’s livelihoods and well-being. It is important to manage someone’s money. The release of data in an industry like finance could have significant ramifications – and therefore the power and control that risk aversion has over a financial services firm is a real drag on progressive customer awareness.

The dial is turned towards aversion and therefore little attention is paid to potential. This is understandable, but also a missed opportunity.

Working in silos

Financial services tend to be structured by channels and products – a home insurance team, a car insurance team, a mortgage team, a personal savings team…these categories don’t necessarily and operationally make sense. together. So, when two teams (or 200 teams) under the same roof work separately, it becomes difficult to assemble knowledge and processes seamlessly.

You might be a consumer whose commitment spans several different products or departments, but something as insignificant as a space in a zip code or the inclusion of an initial can cast doubt on that fact. Still, this is not an easy problem to solve, as merging the records would have huge data privacy and regulatory impacts.


It seems that many people rely on the assurance of an “in-person” experience for their banking transactions, when they might not in other areas of their lives.

While the general assumption is that ‘older’ customers are wary of digital services, it’s an assumption that we need to start challenging more and more. Five years from now, people in their fifties will have an email address since they were teenagers. A lot of people in the 80s have smartphones – in fact, 66% of the entire world population do. Our expectations for digital adoption and communication with customers must evolve as quickly as its users.

Regardless of your personal stance on digital versus physical these days, there’s no denying that banking has traditionally relied on in-person interaction. That may have started to change years ago, but that early stance caused a backlog in organizations that always had the right data, in the right place, at the right time.


Due to the nature of highly specialized individual products offered by banks, a very bespoke IT infrastructure follows suit. This tends to compartmentalise departments and accentuate technical issues. Systems are expensive to maintain, but even more expensive to upgrade.

It’s easy to see how far behind the banking industry is when it comes to tailored awareness, but there’s a huge opportunity for these organizations to improve their offering by focusing on their data and how it’s used.

So how and why should financial institutions focus on data-driven personalization?

It should be noted that banks traditionally score quite low in consumer confidence surveys. The stakes are high – it’s people’s money, it’s important and most consumers are inherently a little on their toes – so trust between an individual and their SF provider doesn’t come naturally. A good personalization strategy is therefore one that builds this trust. It could be a journey that starts with a gentler approach: “We use your data for this purpose, is that ok with you? »

As you build trust with your customer, you can begin to think about demonstrating a fair value exchange – using their data provides a seamless customer experience, and so their necessary interactions with their supplier should not be such a burden. Increased use of data to personalize services can ultimately create a mutually beneficial symbiotic relationship for financial services

suppliers and consumers.

There is a whole panoply of benefits that can be derived from a good deed. Having a fabulous end-to-end customer journey is great for retention. For a large organization with multiple strings to its bow, the ideal customer is one who has multiple products with that single institution, but moves from one transaction to another seamlessly.

Relevancy and timeliness not only help retain existing customers, but also cross-sell. Knowing that someone took out a mortgage a year ago and therefore may need to renew their home insurance may seem simple enough, but it can have a big impact. People are looking for convenience, and personalized content can help with that.

Of course, financial services must continue to walk a regulatory tightrope – the industry is risk averse for good reason. But within these rules, if you can present five relevant options, rather than 500 available products, based on what you know about the customer and their consumption habits, you are likely to continue to drive loyalty, customer satisfaction and additional sales.

The personal relationship between the financial provider and the consumer is an increasingly modern issue that requires increasingly modern solutions. Consumers of all demographics are digitally savvy, dependent on financial services, and looking for ways to make their busy lives easier and more convenient. The opportunity to offer them a holistic, data-driven solution is there for them, if only for those vendors who are brave enough to take the leap. There’s no need to start from scratch or go it alone – contacting expert advisors could help you navigate choppy waters. Trusting your data might be the best thing you can do for your customer relationship.