by, Melissa Henricks, Manager, Product Strategy, Alkami
With the amount of data banks and credit unions have, making sense of it all can seem impossible. Employing the latest data analytics tools isn’t enough to make data work for financial institutions (FIs) either. Without a clear strategy, a wealth of data doesn’t benefit FIs.
Aite Group Senior Analyst, Tiffani Montez joined me to share findings from recent Aite surveys that reveal FIs’ top data challenges, priorities, and missing data capabilities that would provide strategic differentiation and user growth.
The state of data at financial institutions
FIs continue to capture a vast amount of information on how consumers behave and interact every day, but may not be seeing a complete view of user relationships across channels.
Orchestrating analytics to gain insights from data is a challenge for several reasons. Among them, analytics solutions and models some FIs currently use are outdated, leading to insights that can be reactive versus proactive. FIs that store data in silos also lack a complete view of a user’s entire banking relationship.
With the right tools, FIs can gain a better understanding of their users through data. For instance, artificial intelligence (AI) creates an opportunity to enhance an FIs’ analytics process and obtain greater, real-time insight into a user’s financial needs. More options are explored later in the blog, but before an FI selects what technology they want to employ to make sense of their data, they’ll need to set some priorities.
Aligning data strategy with organizational priorities
Aite recently surveyed FI marketing and risk executives to understand what their priorities were and what challenges they faced. From the survey results, Aite determined what key capabilities participants were missing that would help them differentiate themselves.
The highest among the priorities were acquiring new customers, retaining those they’ve marketed to attract, continuing to grow portfolios, and learning when to cross sell intelligently.
These priorities are not without challenges and risks, however. Survey respondents cited fraud risk, regulation and compliance, improving productivity, cost efficiency, and managing the profitability of the user portfolio as areas of concern in tackling their priorities.
The missing key capabilities for FI strategic differentiation included the ability to communicate why a certain action is being taken, integrating new data sources, a single platform that coordinates internal and third-party data, and identifying actions that improve or optimize business performance. Only two out of 10 respondents indicated that all of their solutions had the capabilities Aite asked about.
Building personalized experiences using data
Consumers have become digital-first and want personalized banking experiences, including advice and guidance. With 61 percent of users logging into financial accounts on smartphones to check accounts at least once a week, forming relationships with users through digital banking is more important than ever. But many FIs can’t deliver on a truly personalized experience because of their limited ability to extract insight from their data.
The desire among FIs to seek out new data sources, including nontraditional and third-party data sources, is strong, and FIs are investing in data to gain greater insight into their user behavior and needs. So what’s holding them back? Data management challenges.
Accessing and capturing data is no longer a barrier for FIs, but they don’t have the tools or staff in place to process and analyze their own data. Many are still focused on trying to get their internal data in a central location.
Fractured data and legacy systems also continue to provide challenges, preventing FIs from finding value and making data actionable. Out-of-date technology also hinders the ability for FIs to adopt new tech like AI and machine learning.
Alkami’s robust integrations, single platform, and powerful analytics
Personalized experiences that users demand are formed at the intersection of data integrations and user experience (UX). Alkami focuses on pulling in many sources of data and presenting results clearly where users want to see them.
Alkami’s online digital banking solution integrates with 230+ third parties, including cores, card processors, providers, and more. FI data securely flows into an enterprise data warehouse to provide a single source of truth for everything that matters to FIs.
Marketing and analytics tools like our data engine empower FIs to identify patterns and take action to achieve their goals. Through our deep integrations, users have visibility to data insights also, with a view to their available balance from core, card, and external accounts when launching their digital banking app. Aggregation accounts are synced in the same manner as those held on the core.
FI users can leverage internal and/or account and spending data to target marketing content, putting data to use for total user engagement.
Achieving competitive differentiation and personalizing the user experience all comes down to data. It needs to flow through a single solution that can generate clear insights for leaders and users alike. To dive deeper into achieving these goals, we’ll be releasing three whitepapers with Aite that detail the topics covered in this event.
Thank you to Aite Group for another great Gold Standard Series event!
You can watch Elevating Your FI with the Power of Data on demand by clicking the link below.