Social media users

As social media adoption among consumers continues to accelerate, 2013 saw many financial institutions expand their use of social platforms such as Facebook and Twitter. While social media provides institutions with a greater opportunity to connect with their customers, it can also provide extremely valuable insights into consumer behavior. Armed with this information, banks have an opportunity to significantly impact the success of their marketing efforts to both new and existing customers.

Advanced analytics in banking

Social media is one component of the Big Data equation. The key to successfully utilizing social data lies in transforming it into truly actionable insights by layering in analytics and combining it with other sources of data.

In order to win and retain customers in 2014, financial marketers will have to acquire additional competencies. For example, data science and predictive analytics can help banks synthesize all of these inputs to better target the right customer with the right offer at the right time. Advanced segmentation strategies that help to identify niches based on consumer behavior can significantly boost marketing effectiveness.

Traditionally, segmentation has been used to divide customers into groups based on their demographics, attitudes, or buying behaviors. This helps in trying to target specific groups with the message that will best resonate with them. Utilizing predictive analytics, previously hidden patterns in the data help banks to generate more in-depth customer segments. The resulting segmentation is more precise and nuanced, and is ultimately based on the likelihood that a consumer will accept a given offer. The result is a win-win situation as customers are offered more relevant products and services, leading to a more profitable relationship for the bank.

Beyond segmentation, there are several other ways that predictive analytics can positively impact your marketing success in 2014. These advanced analytics techniques can help you to boost cross-sell, taking advantage of the data to determine which products to offer to which customers. Analytics can also make upsell campaigns more effective, by looking at the patterns in how relationships evolve over time. Predictive analytics can also be applied to your Voice of the Customer program, to identify customer pain points and develop strategies to reduce attrition.

Social media, Big Data, and Predictive Analytics are some of the forces reshaping the way that bank marketers think about their roles. If you’re not harnessing these capabilities yet, you may be missing opportunities to more clearly differentiate your bank in the marketplace.