Financial services is an industry that traditionally relies on legacy systems to handle their data. This isn’t good enough anymore. It’s time to break up the legacy party in the financial services CX tech stack.
Industries beyond those sophisticated streaming services (think Netflix and Spotify) are catching up to the level of data-driven personalization and curation that people demand — and those demands extend to financial services.
Not only is it the experience that people are demanding when they’re looking for their next financial opportunity, but there’s a massive governance and cost consolidation opportunity in revamping the tech and CX stack around a centralized strategy with a lakehouse — with use cases from cross-sell to suppression and more.
At DMFS West, I joined Kate James, Strategic Enterprise Accounts for Financial Services at Databricks, to talk about why financial services needs to get on board with centralized data to create connected and personalized experiences for customers.
Financial Services CX and Composability
3 Reasons Why Financial Services Need a Unified Customer Experience Stack
1. Data Drifts
Financial data is regulated more than almost any other industry. As such, eliminating any risk within your martech stack is key. With a martech stack that necessitates copies on copies of data from your original source, you’re creating a risk with each copy of data. Additionally, your team is working on disparate data, causing dissonance between channels.
2. Data Spend
With many financial services institutions, they aren’t just being asked to cut costs. They’re being asked to unlock more budget within their existing programs. When you’re constantly creating copies of your data, you need to pay to store that data, creating redundant storage costs across the company.
Once you have your data unified, you need to make sure that it’s getting into the hands of the right people, in the most efficient way. Rather than have marketers wait months to get the data they need, they should be able to get it in just hours by being able to tap into the freshest data themselves. Not only does this improve your marketing game, but it saves time for your data engineers.
How Composable CDPs Strengthen Your Data Strategy
The answer to financial services legacy tech is composable CDPs. Composability isn’t a new concept, but for customer data platforms (CDPs), it’s changing the way financial services access and activate their data in real time with more governance and control, cost optimization and usability for business teams (meaning big time savings for data analysts).
Composable CDPs reach down into the centralized lakehouse, like Databricks, to activate the freshest, most robust set of data directly. As you can see in the diagram above, all of the raw data sources come into an organization — think transactional, call center, advertising, loyalty, in-store and proprietary data — and enter the lakehouse for cleaning and enrichment. Rather than creating copies into another system, the ActionIQ CX Hub taps right where that data lives to activate it across channels.
Two Use Cases for Financial Services CX
The process and governance are just one side of the coin — take a look below to see how some customers of Databricks and ActionIQ have harnessed their data to get big results:
1. Paid Media Suppression
When one insurer wanted to optimize their acquisition costs, they turned to ActionIQ and Databricks to activate paid media suppression. If they’re going to run a campaign targeted to a certain policy holder type and they don’t want to market to anyone already holding that policy, they suppress those audiences on paid media to optimize their return on ad spend so they can allocate those marketing dollars to a greater impact campaign.
2. Cross-sell Portfolio Products
One customer wanted to increase production adoption with their data to show clients more of what their portfolio has to offer, but they were concerned about data governance implications for that data. By having their CDP reach directly into their data lakehouse, they maintained governance and security without creating copies — all while activating that data for marketing campaigns designed to cross-sell clients.
Your Legacy Shouldn’t Be Legacy Tech
Financial services have an opportunity now to set themselves apart as institutions on the edge of modern digital interactions, completely in-tune with what clients are looking for: relevancy and speed.
If you want to discover how you can apply, reach out to our experts to discuss.