The Middle East’s financial institutions are drawing up massive plans to engage and retain customers, by leveraging innovation-based digital approaches. Driven by the growth of Neobanks, Saudi Arabia and the UAE are leading banking transformations in the region. The likes of CBD Now by Commercial Bank of Dubai, Mashreq Neo, and Dubai Islamic Bank’s Rabbit are aimed at a digitally savvy audience, as well as the unbanked population in the region.
Accelerated by the pandemic, the region is observing a growing demand for real-time electronic payment methods. Countries in the region with immediate transaction systems in place have experienced significant growth in transaction volumes, with as much as 71 percent of UAE consumers already using digital methods to make payments in stores.
The growth of banking in the region is further corroborated by the Finextra figures; by 2022, around 465 fintech companies in the Middle East will raise over $2 billion through VC funding, compared to 2017 when 30 fintechs raised nearly $80 million. The Middle East Asian region will see rapid technology adoption by traditional banks and financial institutions and connect to the changing customer behaviors.
Bankers in the Middle East are addressing the needs of a highly connected demographic that has emerged called the millennial and Gen Z customers. To engage these tech-savvy, digital natives, banks need to up their game, by providing personalised and relevant financial recommendations.
Providing an experience as seamless and customised as in-person banking
A personalised website model offers the opportunity to build a deeper, one-to-one relationship in banking. Such a customised experience can be provided by understanding and analysing the customer data that resides with the bank, viz. prior interactions, likes and dislikes, preferences, shopping patterns, etc. Banks and fintechs can then offer personalised recommendations based on the aforementioned attributes.
Delivering the right financial advice
It is important to communicate relevant and contextual information to customers, especially in banks and fintechs. Banks can frame such personalised or customised communication based on customer attributes, behavior, and preferences. Channels like push notifications (both app and web push) and emails have proven particularly useful in communicating such messages to the customers.
To set up personalised recommendations at scale, one needs to analyse a customers’ 360-degree profile and create an attribute framework based on their behaviour, preferences, spending patterns, and financial history. This framework can then be mapped with the bank’s product offerings and catalog. Consequently, then bank can offer personalised products for individual users and also forecast the right product recommendations for each customer. Apart from delivering personalised service and delighting customers, personalisation at scale obviously increases digital banking adoption and helps upsell products and secure loyal customers.
Integrating online and offline channels
It is impossible to have an effective campaign without first creating a holistic view of one’s customers. For instance, Gen Z and millennials are known for their short attention spans and desire for seamless and personalised experiences. In this scenario, banks need to move fast, and create customised experiences and offer relevant financial recommendations.
A 360-degree view of the customer involves two main categories of data: user events and derived user attributes. While the first one comprises a user’s online behavior and ways of interacting with the mobile app/ website, the second one gives details such as geographical location and device used.
An intelligent and insights-led engagement platform helps banks create a high performance campaign based on information rendered by the aforementioned categories. Additionally, having the ability to run campaigns and analysing results on a single platform helps marketers design meaningful customer engagement campaigns.
Customer experience is the key to successful marketing and the secret of this lies in consistent and seamless experience. Onboarding, adoption and retention are milestones in a customer’s journey and banks should have automated flows that are easy to create, visualise and deploy across channels.
Segmentation is key
Segmentation is a critical part of today’s marketing campaigns. Customers who show similar behavior and patterns can be grouped together to create segments. Customers can also be segmented based on their needs and wants. For instance, banks can have segments around ‘customers browsing credit card offerings’, ‘customers looking for car loans,’ ‘customers browsing mutual fund investments’. These segments can then be engaged with customised communication relevant to them.
One way to effectively segment customers is based on recency, frequency, and monetary analysis. This model helps banks reach customers with specific campaigns based on past purchase patterns and specific behavior.
AI is the game changer for personalisation
While fintechs utilise AI for sophisticated chatbots, fraud prevention, theft identification, document authentication, and personalisation of financial services, banks are incorporating AI into their operations, opting to deliver the most rewarding customer experience. This hardly comes as a surprise considering that AI is expected to reduce 22 percent of a bank’s operational expenses by 2030, translating to almost $1 trillion of savings.
This, in turn, will rev up channel performance and push up revenues and increase profits. AI offers machine learning-based capabilities built to optimise campaigns by identifying the right message variant along with the right customer segment to reach, best channel, and right time to deliver an interaction for individuals and cohorts.
Raviteja Dodda is the CEO and co-founder of MoEngage
Follow us on
