Survey: Data Strategy Holds the Secret to Customer Loyalty in Financial Services
LONDON, Nov. 20 2019 – According to the 2019 ‘Data strategy and customer loyalty in financial services organizations’ survey from analytics database provider Exasol, 68% of organizations in financial services (FS) believe their data strategy to be extremely important when it comes to getting better customer insights and improving loyalty. Furthermore, 65% of survey respondents agree that working with powerful data analytics tools gives them the ability to better predict customers’ future behavior and enables them to offer stronger personalization.
In a sector where security and compliance are front and center, and heightened customer expectations mean the demand for fast information is higher than ever, those who aren’t paying attention to their data strategy could be losing out. Or worse, they could lose significant ground on their competitors. In fact, according to Exasol’s survey, the impact of poor customer loyalty is keenly felt in lost revenue generating opportunities (42%) and in higher levels of customer churn (44%).
“The successful delivery of a superior customer experience is a key differentiator for FSI firms; especially since digitally savvy customers expect higher levels of personalization than ever before,” said Helena Schwenk, Market Intelligence Manager at Exasol. “Having a progressive data strategy that effectively collects, integrates, manages and enables the business to act on increasing amounts of customer data is essential for any organization looking to remain competitive in the financial services industry.”
But increasing customer retention and improving loyalty is not an easy feat. More than half (54%) of respondents find that customers have higher expectations around their experience when interacting with FSI organizations than ever before, which is making loyalty increasingly difficult to earn and maintain. In addition, 41% of respondents agree that regulations such as PSD2 and GDPR are further impacting financial services organizations’ ability to develop and improve customer loyalty initiatives.
As FSI companies step up their sophistication in data analytics and increase their adoption of technologies like AI and machine learning, the skills and demands required mean that some are challenged to leverage them effectively. According to our survey, the biggest challenge FSI organizations face when implementing data analytics into their customer loyalty initiatives is their inability to leverage advanced analytic methods for their desired analyses and activities (38%), followed by a lack of access to external and more detailed customer data (35%).
Finally, it is worth noting some regional differences highlighted by Exasol’s research. Whilst the majority of respondents globally agree on the strategic advantage of harnessing the power of data analytics for customer loyalty, there are notable differences between UK and US respondents when it comes to adoption of these technologies. In the US, 9 out of 10 (93%) of organizations’ departments have embraced data analytics, with over half of these (51%) encompassing the entire workforce; however, UK respondents say only 37% of the workforce in their organization has fully embraced data analytics. It looks like there’s plenty of room for improvement in the UK when it comes to fostering a data-driven culture in FSI organizations.
About the 2019 Data strategy and customer loyalty in Financial Services organizations Survey
The primary quantitative research underpinning this campaign was conducted in September 2019 by Sapio Research. The survey was conducted among 457 senior level FSI workers/decision makers across Germany, Austria, Switzerland, the US and the UK, whose organizations are focused on/planning to focus on customer loyalty through data and analytics technologies.
At an overall level results are accurate to ± 4.6% at 95% confidence limits assuming a result of 50%.
A robust sample of almost 457 online interviews were completed across three key geographic markets:
- 153 in DACH
- 150 in the UK
- 154 in the USA
Learn more about the 2019 Data strategy and customer loyalty in Financial Services organizations Survey.
Exasol is the analytics database. Its high-performance in-memory analytics database gives organizations the power to transform how they work with data, on-premises, in the cloud or both – and turn it into value faster, easier and more cost effectively than ever before.