Embracing the Digital Era to Engage Members

The banking industry has shifted from relying on in-person visits to favoring personalized mobile experiences that can fit into the palm of a consumer’s hands. In fact, due to engagement tools like banking apps and online portals, three-fifths of all transactions at the most forward-thinking banks are now conducted digitally via smartphones or computers. Digital alternatives to traditional banks (Apple Pay, Venmo, PayPal, etc.) are also gaining popularity, as 29% of consumers worldwide already have a relationship with at least one non-traditional financial firm, according to the 2018 World Retail Banking Report.

Digital communication technologies have completely reshaped the relationship between credit unions and their members, just like it did for retailers and their customers. As operations increasingly move online and into the mobile arena, credit unions must be able to adapt to the personalized omnichannel experiences members expect. This includes launching unified campaigns across email, SMS, mobile, social, direct mail and website channels that also sync up with face-to-face real-time offers.

The good news for credit unions is that this ever-expanding list of new channels has also provided greater insight into member preferences, behaviors and purchases. When combined with traditional channels, they offer financial institutions a greater opportunity to implement a clienteling strategy. The vast amount of data available from various channels allows credit unions to narrow down their efforts for long-term member relationships to the segment of one –using data from previous interactions to optimize the omnichannel experience for each individual member.

However, despite this opportunity to reach and more directly engage consumers, a recent survey by the CMO Council found only 5% of marketers currently believe their organizations are able to deliver hyper-personalized experiences across all channels and member touchpoints. And moreover, 47% of marketers rated their organization’s customer experience as “not very good.”

Removing Barriers to Success

Despite all the data available, financial institutions still have it locked in functional silos. When it comes to understanding the member and their previous engagements, many credit unions have become accustomed to using spreadsheet analysis matched against the occasional ad hoc third-party data integration. These silos are often a result of following privacy compliance and other regulations, and despite identity resolution being an option for anti-fraud and anti-money laundering policies, it’s rarely been leveraged to improve member experiences. The lack of a complete view of a member’s needs, wants and desires has become a significant barrier to successful omnichannel marketing. This is extremely detrimental, considering 80% of members say real-time, customized financial guidance from financial institutions is very or extremely important to them, according to a recent Digital Banking Report.

Offering a single-member view has the potential to completely change how credit unions interact with members and secure long-term relationships. The more that they can provide highly-relevant personalized experiences, the more members will be willing to share the data that makes it possible.

This trade-off is known as the personalization value exchange, and credit unions must rid themselves of the disparate data sources and disconnected views that typically prevent them from providing the hyper-relevant omnichannel experiences members want in the exchange. Failing to provide targeted marketing can hinder a credit union’s opportunity for increased revenue and uplifted member cycles. According to research from Bain, out of those who bought an additional banking product from a competing bank, 42% said they did it because they received an offer or saw an advertisement from the competitor bank. More than half said they would have purchased from their primary bank if it had made an offer.

Making Personalization Count for Members

The ability to ensure personalized experiences, bridge functional silos, and connect all types and sources of member data (first-party, second-party, third-party, batch and streaming) in real-time is essential to this endeavor. Fortunately, customer data platforms (CDPs) have entered the space with a solution to this problem. CDPs act as a single point of control for data, decisions and interactions, and are designed to make a unified member view accessible across the entire organization.

A CDP’s scalability is extremely important because when all departments have clean and unified member data in hand, they can more readily and accurately contextualize their interactions with members and improve engagement. According to Gallup research, when banking customers are fully engaged, they bring in 37% more revenue per year compared to customers who are actively disengaged.

The benefits don’t stop there. A survey by Boston Consulting Group found a majority (54%) of customers said personalization influenced their decision to become a customer of a new bank, and more than two-thirds (68%) said personalization influenced them to buy more products or services from a bank they had an existing relationship with. When a credit union is able to unify member data into a single view and orchestrate dynamic member journeys across touchpoints, it can reduce acquisition costs, and improve retention and stickiness.

In the face of unprecedented global competition, it’s more important than ever for credit unions to push beyond brand awareness and loyalty, and start competing on experience. This requires real-time, personalized interactions that make members more willing to engage, and embark on the value exchange that can continually fuel a mutually-beneficial relationship.

Brian Cleary is Vice President, Solutions Marketing for RedPoint Global. He can be reached at brian.cleary@redpointglobal.com.