Industry
Banking
Banking Services Transformation: Unlocking Exponential Value
Highlights
- In today’s data-rich but regulation-heavy BFSI landscape, financial services enterprises are struggling to build customer intimacy and deliver personalization in financial services
- The modern-day CMO function heavily relies on technology and data to deliver differentiated and meaningful brand and customer experiences across digital channels. Getting the right data to activate these sophisticated ‘marketing technology’ (aka MarTech) platforms is seen as a significant hurdle in enabling value realization and driving personalization
- CMOs cannot solve this problem by themselves. There is an urgent need to forge a strong partnership between Chief Marketing Officers (CMOs) and Chief Data Officers (CDOs) to create a win-win context enabling data-driven personalization across digital channels
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Preface
Imagine a world where your bank or insurance company knows you so well that every touchpoint feels effortless, personal and uniquely tailored to you. This isn't a distant dream—it's the future of marketing in financial services. This blog focusses on building the bridge between the CMO and CDO. These two functions mostly operate independently but have a tremendous opportunity to collaborate and generate exponential value for the enterprise. It explores how data-driven strategies and innovative partnerships can revolutionize the way financial institutions connect with their customers, creating hyper-personalized experiences that rival those of leading e-commerce and media giants.
Moreover, using customer data for delivering personalization requires drawing the fine line between ‘being caring’ and ‘being creepy,’ particularly in the context of looking after their customers’ financial well-being.
Personalization gap
The struggle to build customer intimacy and deliver personalization in financial services.
We are living in an era where consumers are accustomed to hyper-personalized experiences provided by leading e-commerce, media, and travel platforms like Amazon, Netflix, YouTube, and Uber. The advent of GenAI will take hyper-personalization to the next level by bringing in new-age customers and brand-centric agentic experiences conceived and designed at an accelerating pace.
While consumers expect the same level of personalization from their financial services providers, the stark reality is that a large majority of banks and insurance companies are struggling to deliver basic levels of personalization and are still far from creating experiences that FinTech and InsurTech can deliver.
Constraints imposed by regulatory guidelines, compliance checks, legacy platforms, siloed lines of business, data restrictions, GDPR, customer consent, and rules of engagement bring additional challenges and complexities in delivering personalization. Moreover, using customer data for delivering personalization requires drawing the fine line between ‘being caring’ and ‘being creepy,’ particularly in the context of taking care of the financial well-being of their customers.
CMO 2.0
Today’s CMO function is expected to drive business growth and demonstrate ROI beyond just brand metrics. The role of marketing has expanded far beyond being just brand-centric (i.e., building the brand, growing the brand, and protecting the brand). CMOs are under a lot of pressure; they are expected to drive business growth and demonstrate ROI beyond brand and vanity metrics. Since marketers are considered to be super creative and understand the nuances of consumer behavior, they are increasingly seen as custodians of customer experience and are entrusted to design end-to-end experiences across channels and touchpoints, often cutting across sales, servicing, and marketing functions.
Data x MarTech
Data Enablement for Fueling Martech and Activating Systems of Experience
The modern-day CMO function heavily relies on technology and data to deliver differentiated and meaningful brand and customer experiences across digital channels. MarTech, or ‘marketing technology,’ makes up approximately 25% of the marketing spend. While FSI enterprises have made huge investments in MarTech solutions, technology platforms are not sufficient by themselves. Getting the right data to activate these sophisticated platforms is seen as a significant hurdle in enabling MarTech value realization and driving personalization.
In most cases CMOs have to rely on tactical data solutions designed for batch-mode marketing—where campaigns are static customer lists and executed on fixed schedules without real-time insight into consented customer data. CMOs cannot solve this problem by themselves; they need to establish the right collaboration with the CDO (Chief Data Officer) to create a win-win context. The CDO function can play a huge role in unlocking value by enabling data-driven personalization across digital channels. They can help in building secure and compliant marketing data pipelines and products that allow CMOs to deliver timely, relevant regulation-safe customer experience at scale.
CMO x CDO synergy
The story of a great partnership between a CMO and a CDO.
We delve into the journey of a bustling financial services company and its two CXOs: Alex, the Chief Marketing Officer (CMO), and Jordan, the Chief Data Officer (CDO). Both are passionate about their roles and have a vision for the future, but they work in their own silos.
Alex, the CMO, is always on the lookout for innovative ways to connect with customers. She knows that personalization is the key to winning customer trust and loyalty, but the marketing team relies heavily on tactical data sourcing options. This makes it difficult to utilize and activate data effectively and demonstrating the ROI of marketing spend is a constant challenge. She understands that this approach limits value realization. On the other side of the office, Jordan, the CDO, is deeply immersed in the world of data. He has successfully implemented enterprise data products in various functions like risk and fraud management, underwriting, and mortgage pricing. These data products have been widely adopted and supported critical business use cases. However, Jordan noticed that the marketing function was not leveraging data to its full potential. One day, Alex and Jordan decide to have a conversation about their challenges and aspirations. They realize that by collaborating, they can create something truly transformative.
As a next step, they plan a series of joint design thinking workshops along with their consulting services partner. The CMO team, led by Alex, brings in their brightest creative folks—a mix of marketing strategy, content, and creative talent along with MarTech and marketing data specialists. They grasp the complexities of customer behavior and the motivations behind them. The CDO team, led by Jordan, arrives with ‘the data geeks’ comprising analysts, data engineers, and data scientists with a profound understanding of data, platforms, analytics, and insights. This motley crew then spends a significant amount of time understanding and defining various data sets relevant for marketing and personalization, classifying them across three tiers covering a multitude of dimensions including demographic, physiographic, and behavioral parameters comprising of:
- Source aligned data products: Stored in systems of records or reference data stores (e.g., customer/CRM data, products, offers, segments, consent).
- Aggregate or enterprise data products: Available in systems of transactions or transaction data stores (e.g., transactions, spends, membership loyalty, rewards data, financial data, product holdings, life events, interaction data across web, mobile, contact center, branch, adviser, email, chat, and externally sourced partner data along with customer preferences and VOC data).
- Business aligned data products: Analytics and insights data provided by data science teams (e.g., CLTV, propensity scores, churn score, product and profitability analysis, borrowing behavior insights), relationship & event-based pricing/offers, and journey analytics covering channel and content analytics across channels and touchpoints covering web, mobile, contact center, branch, etc.
Further classification of the data sets is done on the basis the marketing life cycle stages such as ‘New customer acquisition’, ‘Engagement and communications’, ‘Cross sell/Upsell’, ‘Loyalty and rewards’ and ‘Retention and churn prevention’.
After a series of workshops, they finally envision the new-age marketing data product with the potential to be a game-changer for the brand. The ‘customer experience knowledge platform’. The consumption layer is designed such that it gets dynamically refreshed by event-based triggers and in turn activates the marketing use cases to initiate in-the-moment contextual offers and propositions and deliver a personalized experience across the systems of engagement supported by conversational agents. The customer experience knowledge platform also envisages a vector data layer which provides benefits such as semantic search and AI discovery, faster real-time processing, multimodal search (audio, video, images, and text data).
Over the next few weeks and months, they set out to create a dynamic, event-driven 'consumption layer' to fuel MarTech and deliver a rich customer experience. This layer allows the marketing team to access and utilize data in real-time, making every interaction with customers more personalized and impactful. In addition to the consumption layer, they also develop a 'publishing layer’ which provides targeted and meaningful marketing insights and analytics to the sales team for enabling conversions; and makes customer experience platform data and relevant NBA/ offers available to the contact center teams for them to have meaningful conversations with customers. The publishing layer also provides much needed reporting data required to demonstrate the ROI of marketing investments.
As Alex, Jordan, and their teams work together, the bank begins to see the benefits. Customers start receiving personalized experiences that make them feel valued, and the marketing team finally starts demonstrating a quantifiable impact of their efforts. In the end, Alex and Jordan's collaboration not only revolutionizes the marketing function but also creates exponential value for the entire enterprise. They prove that by working together, the CMO and CDO can achieve great things and lead the company into a new era of data-driven marketing.
And so, the story of Alex and Jordan becomes an inspiration for other financial institutions, showing that innovative partnerships and data-driven strategies can transform the way they connect with their customers.
Conclusion
As financial institutions strive to deliver hyper-personalized experiences in today’s data-rich but regulation-heavy BFSI landscape, it's crucial for CMOs and CDOs to collaborate and leverage data-driven strategies. Through collaboration, they can tap into the full potential of their marketing and data capabilities, creating transformative experiences for their customers. The future of customer engagement lies at the intersection of data precision and marketing empathy and that bridge must be built together.
As a CMO or CDO seeking to lead with innovation and create greater value within your organization, consider forging a strong partnership and exploiting the power of data-driven marketing.
