Hyper-personalized Omnichannel Banking: The Novel yet Necessary Approach

Hyper-personalized Omnichannel Banking: The Novel yet Necessary Approach

Consumers are more demanding and informed today, expecting convenience and simplified financial services. They want greater flexibility, 24/7 service, and multi-channel interactions.

As a result, delivering a consistent brand experience across these channels has become a top priority for banks. However, the existing banking system has some downsides restricting them to win the market.

Complicated experiences create data silos and fail to deliver a seamless user experience. When each channel captures data from different sources, it creates data consistency issues. This makes data analytics complex while slowing down decision-making and customer services. Tighter IT budgets, high maintenance costs, and inadequate backend systems are other challenges that banks have to face.

In mobile-first world, customer engagement needs to be personalized and frictionless. Banks are expected to deliver consistent experiences across touchpoints as per customer preferences. That’s hyper-personalization in banking.

Omnichannel Banking is Needed in the New Normal

Omnichannel is all about providing a seamless and consistent interaction between customers and banks across multiple touchpoints. IBM defines omnichannel banking as a multichannel strategy enabling anytime, anywhere, any device access with consistent experience across channels. With omnichannel, banks can fulfil customers’ needs and foretell their wants and likes.

According to a study, 76% of customers look for an omnichannel experience, and 59% of customers need on-demand, anywhere anytime service.

In the new normal, global banking giants have to adopt new standards of servicing, incorporating enhanced personalization, unmatched availability, and unprecedented growth. For this significant uplift, omnichannel is a key enabler for banks with incomparable robustness and scalability to foster digital capabilities. It helps banks accomplish a competitive edge in enabling new channels while building customer loyalty, retention, and acquisition. Omnichannel strategies enables banks to move from tangible performance accomplishments to customer-centric success metrics while upscaling their digital skills. This, in turn, helps in brand building, revenues boost, lowered operational costs, personalized digital banking experience, and improved customer engagement.

The grounds of omnichannel offerings heavily depend on customer experience personalization to cater to distinct customers’ as well as banks’ requirements. This can only be achievable with hyper-personalization.

Hyper-personalization: A Critical Enabler for Bank’s Digital Evolution

As banks look to the future, next-gen technologies such as big data and AI can unfasten unparalleled potential to deliver omnichannel experience while improving customer services. Moreover, smart devices, rapid-evolving customer experience, and real-time data processing have made hyper-personalization critical for banks.

Hyper-personalization is a powerful differentiator for banks. Being an AI-powered technology, hyper-personalization uses real-time data to recommend customized products and services to customers. This makes fine-tuned, customized, and targeted experiences via data analytics, AI, and automation. Hyper-personalization helps in maximizing revenue via data-driven content generation, detailed product targeting, and next-best offers. This assists banks in reducing costs by automating workflow as well as strengthening customer acquisition and retention. Hyper personalization also provides a competitive advantage to bolster brand visibility and offers high-quality services.

For successful hyper-personalization implementation, banks should use their customer base, understand information from different channels, combine real-time data with AI, and use predictive models to deliver uncluttered banking experience. With well-structured and personalized customer data, banks can render real-time hyper-personalized experiences across channels.

According to BCG, a successful personalization at scale can increase the bank’s annual revenue by 10%. The digital transformation of the banking domain is inevitable; however, banks are slow to adopt the ways consumers are utilizing banking services.

Why do Banks Fail to Modernize Banking Services? Key Reasons

Omnichannel strategies along with hyper-personalization are key to next-generation banking services. However, modernizing core IT ecosystems to enable such customer-focused experiences is not an easy feat. And, there are multiple reasons behind the same.

Major banking and non-banking apps are running on-prem. The existing infrastructure can be vulnerable to performance, security, and compliance standards. A single attack, unexpected downtime, or non-compliant infra could lead to loss of customer trust, financial damage, and reputational risk. Moreover, banks are grappling to address increasing security gaps and latency issues. On the other side, modern banks are expected to improve financial inclusion and meet customers’ requirements on a highly-personalized and dynamic basis.

Shockingly, 94% of financial services are still not aligned to hyper-personalized services or cannot support such use cases at full potential. Because:

  • When it comes to data-sharing, global banks face regulatory impediments such as stringent customer data privacy and protection, and security regulations.
  • Customer data is a potential goldmine but seems hard to access due to legacy technology.
  • Insufficient teams, monolithic architectures, and inconsistent and fragmented customer experience are intimidating to the system.
  • Lack of 360-degree customer view and consistent user experience across channels.
  • Demographic constraints cause customers to turn elsewhere for their banking needs.
  • Impediments to rollout new tech cause business interruptions.
  • Banks lack customer trust, necessary tech expertise, and limited budget.
  • Other inevitable challenges are zero visibility, a product-oriented mindset, and corporate culture shifts.

Banks can alleviate these obstacles by moving towards a future-proof architecture to orchestrate customer interactions across multi-channels as well as provide customized services and tailor-made products. This will include deploying cloud-based apps & platforms along with partnering with third parties to capture consumers’ data and deliver solutions accordingly.

The Solution: Explore Cloud4C Bank-in-a-Box Approach

Being able to exceed constantly changing customer needs, dynamic shifts in regulatory compliance, and growing cybersecurity risks have forced banks to utilize new technologies.

Supported by a robust IT platform that can deliver frictionless financial experiences to customers anytime-anywhere without a glitch, cloud-driven omnichannel banking helps banks manage a multitude of digital channels with faster time-to-market, and reduced IT costs. IDC reported that cloud-based services help banks to lead innovations, do faster digital transformation, and reduce operational costs

Cloud4C’s Bank-in-a-Box provides banks a unified roadmap to cloud transformation in a single 99.99% SLA from infra till application login layer. The customized cloud framework is built to meet the requirements of risk-mitigated transformation, robust security and compliance, high application availability, and adaptability delivering end-to-end migration, modernization, and managed services on any cloud of choice. This enables banks to introduce new products faster while handling mission-critical IT operations and banking transformation necessities.

Since all bank’s requirements are different, it’s imperative to understand their current capabilities and build strategic blueprints as per their desired goals. Bank-in-a-Box enables banks to meet evolving customer needs for a self-service, automated, hyper-personalized, and omnichannel experience. This expedites their cloud adoption by offering a single point of accountability, and pre-met regulatory compliance. Explore more about Cloud4C Bank-in-a-Box.

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