Why Hyper-Personalization is the Future of Community Banking

Larissa Lewis February 17, 2021 Banking

hyper-personalization-banking

Community banks are the connoisseurs of their local community. They’ve fostered personal relationships with their customers, understand the needs of their local residents, and are on a first-name basis with much of their clientele. Community banks donate to local charities and are more willing to go out on a limb to support the dreams of neighborhood business owners. It’s a recipe that works—community banks reign over national behemoths when it comes to customer satisfaction. While they continue to set the pace for white glove, in-person service, tech-savvy institutions are blazing the new trail towards digital using the powerful technology of hyper-personalization

What is hyper-personalization? 

Tear a page out of the traditional mega-bank marketing playbook and you’ll find an arms race of advertising: expensive ad buys luring customers with generic, aspirational messages about the bright future of their financial security. Whether a customer was interested in a small business loan or a home mortgage, banks inundated all customers with the same exact messaging. 

Hyper-personalization bucks the all-for-one messaging trend and uses technology to create more one-to-one conversations. By utilizing real-time data and tools like artificial intelligence, banks can hone in on a customer’s precise needs. Instead of treating a customer like a faceless member of a larger cohort, you can use technology to provide tailor-made products curated to their specific customer’s preferences. Combined with their relationship mastery, community banks can be a rainmaker of online experiences. 

How is hyper-personalization different from traditional marketing? 

Businesses across all industries have felt the consequence of years of plugging one-size-fits-all marketing initiatives. Advertisers jam-packed the airwaves with lists of miles-long options—after all, isn’t more always better? Instead (as revealed in 2010’s The Art of Choosing), customers experienced the opposite. The more options offered, the more inconvenient the process became, and the more hesitant they were to make a choice. Most times, overwhelmed customers refused to make a purchase all together. 

To combat the problem of “choice paralysis,” tech-savvy banks and businesses turned to the practice of hyper-personalization to create a more convenient and streamlined buying journey. By only offering a unique list of products or services relevant to that specific customer, marketers can achieve 18X more revenue than traditional mass messaging

The Big Four Banks are aggressively injecting convenience technologies into their customer experience and it’s paying off—they’re growing at an annual rate of 88% compared to only 8.2% at community banks

Community banks have an unbeatable competitive advantage over national conglomerates when it comes to wielding the power of hyper-personalization. While larger banks clamor to find ways to connect with their customer base on a more personal level, community banks are already armed with the most powerful weapon—the human touch. 

Let’s dive into the many ways your community bank can use hyper-personalization to outbeat larger competitors and grow your customer base. 

How your community bank can grow by using hyper-personalization technologies

Instead of waiting for customers to come to you with questions, you can use hyper-personalization to proactively provide Banking-As-A-Service (BAAS). Here’s how you can deliver your revered style of relationship-based banking through your online experiences. 

Targeted email campaigns 

Personalized emails involve more than simply greeting the recipient with their first name. Known as a ‘drip campaign,’ targeted emails distribute topic-relevant information based on a user’s behaviors. Does a customer frequently visit small business resources when logged into your website? Using hyper-personalization technology, you can fire off a set of automated emails packed with content focused on how your bank supports local business owners. Your email sequence should include compelling information like videos, case studies, or white papers that showcase your bank as a beacon of business knowledge for your local community. 

Host a webinar or other live event

Community banks understand the ins-and-outs of their local region and are thought leaders in customer needs often ignored by the Big Four. In fact, 80% of agricultural loans in the United States are managed by smaller institutions—a niche banking behemoths can’t beat. As a community pillar, you can host online events that cater to these unique needs. 

Display webinar invites based on a user’s web behaviors. If they consistently visit pages on your site that relate to farming finances, you can display an invite to your next topic-related webinar on their third or fourth visit.

Start conversations with chatbots

You can’t regale every web visitor with your friendly rapport, but you can enlist chatbots to start the conversation for you. If a customer is immersed in an article about personal loan offerings, you can trigger a pop-up that asks if they have any specific questions they need help with. Chatbots are great at providing canned responses to basic questions, and can automatically pass the customer up the rung to a live representative when the conversation gets too complex.

Display information based on 

Use hyper-personalization technologies to identify sale-closing patterns amongst your user base. Perhaps a certain mix of services often leads to the purchase of another specific service. For example, you can uncover data about how long after opening a checking account customers are most interested in opening a savings account. Maybe a customer who has both options is more likely to dive into your home loan content. By using hyper-personalization, you can distribute only the information a customer will feel most interested in.

Hyper-personalization is more than just another passing buzzword. In fact, 80% of consumers say they are more likely to engage with a business that offers curated experiences, and community banks have a unique opportunity to set the pace. Disillusioned by false “customer-first” claims and exorbitant hidden fees, nearly half of customers believe all banks are the same. “All banks really care about are their own interests, even though they may claim to have my interests at heart,” agreed two out of three customers. What is a perilous sentiment for large institutions is actually a great opportunity for community banks. Now more than ever, smaller institutions can use hyper-personalization to launch their firebrand of genuine concierge-style care into the digital realm. 

 

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