Banking providers think long and hard about their core processing system because, it’s the basis of their business. However, it’s not a differentiator in the marketplace because, every retail banking provider has a functional core processing system. As branches empty, and the basis of competitive differentiation shifts to the digital channels, banking providers need to think about a marketing core processing system that will differentiate them in an increasingly digital banking environment. But, what would a world-class marketing core processing system look like?
The number of banks and credit unions is shrinking as virtual banking moves customers from local branches to phones, tablets, and PCs. This shift favors retail banking providers that can deepen customer relationships quickly through the high traffic digital channels, where customers/members increasingly choose to bank. Why does this shift favor excellence in engagement and cross-selling?
Relationships deepen faster with a lot of interaction, listening, and learning -- because the relationship becomes more rewarding. Last week, I met with the chief data officer of a very large U.S. financial service provider (9MM unique visitors per month) and he, too -- is always trying to connect customer click streams back to his machine learning systems so direct expressions of customer interest can be used to train the classifiers used to determine audiences for marketing messages. Unfortunately, advertising and email can only provide a small amount of information on positive interest, and almost nothing on "no interest".
As soon as I roll out of bed, I click a button to buy breakfast from Panera. While I brush my teeth, I ask Siri to text my parents. I order an Uber as I run out the door to start my day. I, along with the 74.8 million Millennials that make up nearly a quarter of United States population, live by the “Amazon 1-click” lifestyle – everything must be fast, efficient, and convenient or it is considered useless, worthless, and antique much like Blockbusters or the US Postal Service.
I pass by a lot of empty bank branches on a daily basis, and I must say they are beautiful places. They are clean, spacious, beautifully designed, and feature concierges and free coffee! What's not to like? The problem is, there aren't any customers in the branches so, bank employees are decked-out and looking for something fitting to do.
n the earlier days of banking, when people just began moving their cash savings out from under their mattresses, everything was simpler. There would be one local bank in your town, and that’s where you would go to get all of your banking needs satisfied. If you happened to live in a larger city, perhaps there would be two or three small banks in your vicinity. But times have changed.