In the previous module on Business Models, senior marketing managers rated their company’s capability of ‘Capturing a single view’ of the customer at an average score of 2.8 out of 5. This reflects the fragmented data architecture on legacy systems that exists in many organisations.

How a Bank Achieves a Deep Understanding of its Customers

Single View

Being able to capture a single view of their customer is fundamental to understanding them, through their demographic profile, their potential needs through their product holdings and how they use them, and their current and potential future value to the bank.

Understand their Customers’ Needs, Life-cycle Events, and Problems

Customer needs are unfulfilled dreams, jobs to be done, problems yet to be solved, or future life-cycle events that haven’t been realised.

By systematically collecting what customers are planning or expecting to deal with in the future, along with some sense of a timeline, the bank can build up a picture of where and when they can help fulfil a dream, get a job done effectively, or solve a problem.

Many customers are happy to share this information with their bank, provided the bank uses it responsibly and for mutual benefit, and demonstrates trust in their bank.

The advantage to banks is that they construct more accurate predictions of the customer’s future value, although they still must undertake the activity to realise the opportunity. We discuss this in Customer Value.

Understand their Customers’ Behaviour

This is how a customer interacts with their bank and provides valuable information about how they view and use their bank account. In the past, how customers transacted with the bank was used in anti-money laundering checking and credit scoring. Understanding how the customer interacts and transacts with the bank can reveal patterns of behaviour that show attitudes to the bank.

For example:

  • Are they a ‘customer’ who gets their salary paid into their account, and then pay their mortgage or rent and utility bills? Or are they a ‘user’ who just uses the account for free services, such as overseas travel and foreign exchange, for which another bank normally charges?
  • Do they browse products and services that they don’t yet use, but not buy them?
  • How do they react to different communications, for example, do they open emails? Do they respond positively to the marketing message that recommends that they find out more, or buy, the product (that marketers name a ‘call to action’)? Do they use some channels in preference to others, such as visiting branches to make enquiries about products, rather than making a phone call or using Internet banking?