Beyond The Transaction: Understanding Your Customers On a Deeper Level

Beyond The Transaction Understanding Your Customers On a Deeper Level


When was the last time that you really looked at your customer? And no, we don’t mean lifting your head from whatever stacks of paper you are working on to flash a smile and get back to your work. We mean the type where you obsess over customer habits and tendencies to develop a personalized experience best suited to meet their needs.

For most banks, customers are nothing more than a source of money, money they can use to generate more and more income. And banks are not the only ones at fault. The advent of technology has made it easier for customers to stay at home. Today, people can deposit through their phones and pay through their credit cards, and that’s all the banking services an average person will probably use in their lifetime. And as more and more people embrace technology, banks have forgotten the importance of fostering a personal relationship with their customers.

As we move to the post COVID era, it might be difficult for banks to sustain operations with a similar approach. The need for agile banking tells us that if banks want to survive in the longer term, they need to start tracing customer journeys, solve pain points, and be flexible. Understanding your customer goes a long way in understanding your business and how best to improve.

But how do you find that connection? Through data analysis.

The days of one-for-all banking experiences are over. Customers today want personalized experiences. They don’t need banking institutions that just want to make money off them, but rather baking institutions that understand their needs. And any banking institution that doesn’t do the same is not deemed worthy. And to become a banking institution worthy of their time, banks need to use data analysis. Data is the key to understanding your customers and their behavior. But the amount of data collected by a bank is massive, and analyzing every piece of information will take time. So, what do you do? You need to find the right data.

Which is the right data?

You probably have a ton of data lying around. The banking industry collects a ton of data and information from its customers. A bank knows everything worth knowing about a person, including their demographics, finances, purchase habits, and many more. But that’s not the only data you will need.

People today are very good at influencing others to take up specific banking options, whether it is through social media or any other mechanism of influence. And suppose you want to get an accurate understanding of your customers. In that case, you will need to know how satisfied they are with your services, especially when they can easily switch banks for better offers and services. That’s the data you need.

Having access to this information will allow banks to gain a deeper insight into the customer’s mindset and plan their next move to meet changing demands.

Personalize customer experience with data

So, you now have the correct data, but what do you do with it? The next step is analyzing the data and drawing workable inferences. Once that is done, use the information to design banking products that best appeal to your customers. Customer behavior analysis will tell you where your customers might be spending most of their time and which kind of services would make more sense for them. For example, if most of your customers are spending credit cards in cafes or coffee shops, introducing discounts while spending in selective restaurants can help you target more customers. Or, if most of your customers are interested in opening fixed deposits, automating the process can reduce pain points and make it more accessible.

Be careful with full automation

While automation is an excellent way to reduce pain points in the customer journey, no banking institution serious about customer satisfaction should go full automation. While automation can pave the way for better customer service, losing personal touch entirely in favor of providing better banking services might have the opposite effect.

Customers today want personalized experiences, and if they see no difference between two banking institutions, they will not think twice before switching. Beyond these reasons, going full-automation means banking institutions themselves won’t understand how best they can improve on their existing services. And a stagnant bank is as good as dead.

Final Thoughts

Today, the banking industry needs to be careful about how they perceive their customers. This is even more so in a world where banking relations are changing rapidly because of newer technologies. And while automation is good at certain aspects, letting it take over the entire process might not be the way forward. Banks need to balance automation and personalized experience and use customer analytics to support the latter.

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