Thought Leadership

The Attrition Mission: Banks Using a Data-Driven Approach to Improve the Customer Experience

For years, many have viewed retail banking as a commoditized market. When rates are similar across the industry, there’s only so much that banks can offer to distinguish from the competition. When you sign up, free checking and a toaster may have helped banks attract and hold onto customers, but that’s no longer the case. Not everyone wants a toaster, and in many cases, making the same offer to thousands of dissimilar customers is akin to shoving a square peg in a round hole. Quite simply, that approach is no longer good enough.

In a data-driven world, competition to attract and retain customers is at an all-time high. Banks across the globe are beefing up their technological war chests to develop a deeper understanding of customers and to present them with more relevant and timely offers – and to do so faster than the competition. At the same time, competition is coming from new places, including technology companies that are jumping in and putting the customer at the center of the picture.

A critical issue for banks is gaining a better understanding of and preventing customer attrition. When customers need help distinguishing any real difference between banks, those banks must focus on the customer relationship and increase engagement with the appropriate messages, products, and services that customers expect in a data-driven world. Happy customers tend to be loyal, and a data-driven approach to improving the customer experience can help banks reduce attrition.

Here at NGDATA, we’re working with some of the biggest banks in the world to solve this problem, helping them to understand their customers in a more profound, more nuanced way by building individual profiles for each customer. Understanding customer data allows banks to more easily predict when attrition might occur, providing the means and the opportunity for banks to present more timely and relevant offers. For example, changes in specific metrics correlating to attrition could trigger personalized offers designed to nudge a customer to consider leaving.

Traditionally, customer information has been locked within functional and application silos, making it extremely difficult to detect early warning signs and take action to correct them in real-time. As a result, banks end up strategizing and operating on only the most basic slices of incomplete information from each silo, making themselves vulnerable to attrition.

By connecting all data sources – from ATMs, POS, branches, call centers, IVR, mobile, M2M, payment systems, web, and mobile apps to social media – in real time, we’re allowing banks to leverage big data to understand customers better and ultimately reduce attrition.

To learn more about how we work with banks, check out our Client Success Stories.