With the rise of digital alternatives, financial services organizations are losing customers who would’ve been taken for granted in previous generations. They stand to lose market share and see revenue fall. But these institutions can attract and retain these customers through the kind of data-driven personalization that fosters trust and loyalty.

Most banks have some, but not all, of the necessary personalization capabilities and underlying technology already. However, no organization can be great at personalization if they only have some parts of the puzzle.

Stronger personalization correlates with better customer relationships, greater return on investment and increased revenue. Research from Epsilon found that 80 percent of consumers are more likely to do business with a company when it offered personalized experiences and 90 percent said personalization is appealing. According to a study from Monetate and WBR Research, 93 percent of businesses with advanced personalization strategies increased their revenue.

Why personalization is nonnegotiable

Brian Henning, Salesforce practice lead for financial services at Publicis Sapient, explained that four factors are driving the need to increase personalization: higher customer expectations, massive new datasets, deprecation of third-party cookies and data privacy regulations.

With intuitive platforms, prominent technology companies have raised the public standard for a positive customer experience. Facebook, Amazon, Apple, Netflix and Google, known collectively as FAANG, understand their customers and anticipate their needs. Accustomed to seamless service across multiple channels, today’s customers expect the same from other key areas of their lives, namely where they entrust their savings and investments.

An age of alternatives

Established banks are ultimately facing a loyalty crisis as digital challengers offer platforms and services that are highly engaging, easy-to-use, and always accessible via numerous channels and devices.