April 29, 2022 | 4 min read

Customer Data and The Future of Digital Banking

The personal banking landscape is shifting and digitizing at a pace that is unlikely to slow down.

Illustration of three men collaborating in an office environment

Banking is a fundamental activity that we all have to do. 

Where, why, how, and the places we choose to do it are questions we all answer during our personal and evolving banking customer journeys. 

Banks and credit unions that aren't asking these questions about their clients – existing and prospective – are missing critical customer engagement opportunities. They are also in danger of losing ground to the increasing number of non-banks and personal finance apps that aggressively court tech-savvy "traditional" bank customers who expect accessible and highly personalized customer experiences.

Conquering the next level 

The challenge more traditional banks face is unlocking these digital engagements. To do that, they need tools with the capabilities to:

  • Handle massive datasets because banks, more so than other companies, have enormous amounts of data to wrangle. Every swipe someone makes with their card, engagement with banking apps, call to a service center, and visit to a branch is a piece of data that can form a picture of customer and their preferences.  

  • Connect data from multiple sources into coherent customer profiles, even if data is housed in legacy systems that were not designed to talk to one another.

  • Generate insights and intelligence from data to make informed decisions to drive adoption, increase revenue, boost customer satisfaction and connect with customers at pivotal life moments.

(For a more in-depth look at the technological capabilities needed to make the most of customer data and power digital experiences across channels, check out the blog post we wrote on it.) 

But why is it so important for established financial institutions to be able to harness the power of their customer data? It’s a matter of shifting consumer expectations.  

The ascent of the digital dollar

In 2022 it's no longer a question of "what's in your wallet?" — instead, it's "what's on your mobile device?" and "how can we help you use it?" Enter financial technology, aka fintech. Fintech describes any software-based technology that delivers or facilitates financial services and transactions such as online banking and mobile payment. Fintechs are not accredited institutions like banks and credit unions. They cannot accept deposits or provide loans, but their growing share of the financial marketplace makes them relevant to any discussion of the current and future state of digital money management.

Between 2018 and 2021, there was an 86% growth in the number of fintech start-ups in America. Fintech adoption and usage are highest among younger customers, whose primary digital touchpoints and interactions are in the mobile wallet and mobile payment sectors.

To put it simply, fintechs have seen the future, and the future is mobile. As a result, customers are no longer satisfied with most major financial institutions' traditional (read: limited) online checkbooks.

A successful digital marketing strategy for banks and credit unions plugs the digital gap between accounting activities, like checking balances, and actual digital money management, for example, viewing recurring charges and credit scores or managing subscriptions.

This also means providing customers with smart, timely notifications, specific recommendations for services and products, flexible banking options, and the seamless ability to shift between settings and get the same service whether they are interacting on mobile, desktop, phone, or in-person.

The future of banking: wherever and whenever you need

The personal banking landscape is shifting and digitizing at a pace that is unlikely to slow down. Although this change was inevitable, it was greatly accelerated by the pandemic, when people were stuck at home and unable to access physical locations. Many turned to digital touchpoints to complete routine money management tasks.

As the U.S. emerges from the pandemic, the trend toward digital interactions is unlikely to cool down. Consumer expectations have evolved, and now is the time for banks and credit unions to seize on the digital momentum of the pandemic to develop the evidence-based, future-ready cross-channel and cross-platform customer experiences that their clients prefer.

For any financial services organization to deliver top-tier experiences, they need a solid customer data foundation with the ability to organize and activate that data. Without the proper guidance, this can be quite difficult and often trips banks up; this is where having the right customer data tools come in handy. With them, banks can make sense of messy data and turn it into valuable insights to engage customers and grow value.

To learn more about the tech infrastructure and use cases for turning customer data into business growth, download our guide to personalization at scale and check out the examples for financial services.