Understanding the customer and how they care to conduct business and interact with a given institution has become vital as access to alternatives and substitutes become more and more widespread and sought after by empowered consumers. The image of the efficient banker has come to be seen as cold unfeeling self-interested business with arbitrary rules and penalties. Technology, particularly mobile communications and digital banking, have enabled more people to look for financial services further afield and thereby introduce dynamic competition.
Fintech, the growing category of companies pioneering new financial technology, is using analytics as a core part of their offering. For example, personal financial management software tracks how a consumer or small business spends money. With predictive analytics, that fintech service can now offer highly tailored alerts. What was once just a dashboard or static report, is now supplemented by personalized advice on how to save money or invest more wisely. Fintechs providing advice-as-a-service are using machine learning and predictive analytics to deliver tangible value.
Mercator Advisory Group’s Customer Interaction Advisory Service is taking a closer look at the variety of methods and approaches both upstart and establish financial institutions are employing to expand their relevance and value to today’s and tomorrow’s customers. We recognize the role predictive analytics will play for these forward thinking institutions in generating insights in order to make suggestions to consumers in real-time. Consumers will want self-directed plans, but also reminders and small rewards for sticking to longer-term plans. It remains to be seen which strategies will resonate the most widely and effectively with consumers.
Overview by Joseph Walent, Associate Director, Customer Interaction Advisory Service at Mercator Advisory Group
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