Technology and Data News and Events

The finance industry must focus on real-time insight to enhance the overall customer journey

by Mike Jones in Artificial Intelligence, Data Analytics 03/06/2021

Forward-thinking financial businesses are applying data, analytics and AI to create new products and services and to enable the delivery of more intuitive and personalised service. Future success requires attracting skilled talent, enhancing existing processes and meeting the increasing demands of customers.

The finance industry is continuously focused on digital transformation and utilising data, analytics and artificial intelligence to improve their services. Banks are applying AI to enhance their current offering, build new products and improve the overall customer service. Data and analytics are proving vital in supporting the progression of new business models and improving decision making.

This significant shift comes with its challenges, such as accessing data, the quality of information, the available skilled talent and the delivery of necessary resources to generate the required results. Most financial teams also lack the required digital experience to create and build a digital-focused organisation. Nevertheless, the decision-making influence of data and analytics provide financial businesses with the competitive edge needed to provide the added value to their customers.

According to studies from McKinsey, Financial businesses that apply data and advanced analytics to engage with customers and drive new business are capable of generating value in several ways:

Enhanced Customer Acquisition: By focusing on delivering personalised information at every step of the customer acquisition journey, engagement becomes simplified and the overall customer experience is improved.

Higher Customer Lifetime Value – Offering new products and services to customers is done through intelligent communication and recommendations based on real-time analytics and data.

Reduced Operational Costs – Automating and simplifying data processes and decision making plans, overall efficiencies are improved and costs decline.

Reduced Risk – Applying advanced analytics enables selective decisions on potential customers and allows detailed analysis of customer behaviours to detect potential cases of risk and fraud.

Financial businesses are increasingly looking for analytical solutions to improve their position against other competitors. According to a report by the Cambridge Centre for Alternative Finance and the World Economic Forum, several global financial services firms have implemented or are working towards adding AI solutions within a range of business functions. Data from the World Economic Forum suggests that approximately 85% of all financial businesses have implemented AI, in some shape or form.

Beyond the security and risk detection side, an increasing number of financial services are applying analytics to create new services and an innovative customer experience. Advanced analytics can be applied across the entire customer journey, from initial engagement through to evaluation and ongoing relationships. As a business uses AI to further deepen its understanding of each customer journey, the organisation can deliver highly personalised offerings directly to the customer in real-time.

Applying data to generate insights that can be applied across the business isn’t enough. Financial businesses that engage continue to increase, experiences are enhanced and loyalty is strengthened. In other words, the ROI on data and AI is not fulfilled until these factors are achieved.