Meanwhile, hyper-personalization is not just big-data, it moves beyond ‘data-driven’ to ‘analytics-driven’ with a focus to better understand customers emotional state and the context behind it and responding/nudging suitably. The ability to leverage emotionally intelligent nudges in real-time will be one of the biggest, most important opportunities for FS firms going forward.
Hyper-personalization as a competitive edge
As FS industry become increasingly commoditized with margins coming under significant pressure, it becomes imperative for FS firm to better understand their customers. Understanding not only transactions but also financial needs, goals, and behaviors creates financial solutions that are both relevant and timely. This knowledge (data) also enables superior engagement across channels and forms the bedrock for hyper-personalization at scale.
If done properly, hyper-personalization enables FS firms in elevating customer loyalty and engagement. The existing customer base also act as an engine of advocacy to potential buyers.
Overall, hyper-personalization increases the potential to realize market leading revenue growth, while remaining nimble and cost efficient. FS firms that create and implement hyper-personalization strategies will be able to keep up with the increasing demands of consumers while staying ahead of their competition.
Future view: FS as a platform
The ongoing trend towards Platformization of Financial Services and subsequent change in business models like 'banking-as-a-platform' are creating exciting new ways to grow revenue streams, attract new customers and transition to adjacent industries. As the financial product is becoming less important than customer, BFSI firms are embedding payments, loans, insurance and wealth directly into the customer experiences.
Fig 2: Customer contexts around various financial products