When will personalized banking arrive for everyone?

Reviewing how technology and tailored banking has advanced.

Bentzium Aviv, Customer Business Executive


15 Feb 2023

When will personalized banking arrive for everyone?

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Modern technologies can provide banks the ability to offer a personalized banking service to everyone.

In banking and in other industries, personalization is a hot topic. But here’s something you don’t hear much about: It’s difficult to get personalization right. Let’s look at why.

Say you’re hiring a web developer. You hear that your neighbor is looking for a job, so you send her the job description. If she’s a web developer, she’ll thank you for thinking of her. But if she’s a civil engineer, she’s likely to be offended. Don’t you know she’s not a web developer? She’s spoken to you regularly for years. It’s like you don’t know her at all or weren’t paying attention. Of course, you’d never offend your neighbor like that. Yet, many banks (and other businesses) regularly irritate their customers by sending them offers that aren’t relevant.

Today, businesses are racing to personalize customer service, offers, and digital experiences ahead of the competition. This effort is critical for two reasons. Firstly, customers are more likely to entertain relevant offers. The second—and I think more important of the two—is building stronger relationships with customers. Offers and communications that scream “I don’t really know you” make customers think that you don’t value their business.

In banking, personalization can help traditional banks keep their long-time customers from switching to digital-only upstarts. Those digital-only banks usually offer low fees, a good mobile experience, and responsive customer service. But traditional banks have the advantage of long relationships and trust. Effective personalization of the banking experience makes that tangible for customers. It tells your customers “I know you and value your business.”

Consumers expect personalized experiences

Customers—both businesses and consumers—have higher expectations of those they do business with than ever before. Banks are no exception. Many banks have responded by improving their online banking experiences and offline experiences. For instance, banks are investing in launching ever-more online features and new products, like saving tools and buy now, pay later options. But it’s not enough. People aren’t just comparing their bank to banking in the past or to other similar banks. They’re comparing their bank to Netflix, Google, and FinTechs.

If Netflix knows them well enough to suggest they might like a documentary about Vikings—why does their bank keep suggesting credit card rewards and other products that aren’t relevant? People enjoy a high degree of effortless personalization within many of the digital experiences they access regularly. Traditional banks need to keep pace.

Siloed data prevents easy personalization

Banks have a wealth of data about their customers. That serves to elevate people’s expectations. But it’s also at the root of the personalization challenge for banks. The data is siloed. Credit card, mortgage, brokerage, and other types of data are housed in different systems. It’s difficult to use the data to segment customers and offer them relevant products. The systems don’t “see” customers. A customer with five different types of accounts might as well be five different people. This makes gaining the 360-degree view of customers needed for personalization difficult.

Banks are trying to overcome this challenge—they have been for years. Many banks have made progress. For instance, banks can create data warehouses that let them analyze customer data in ways that would have been impossible just a few years ago. This approach demands significant compute power and IT resources. It turns every interesting product personalization idea into an IT project. But it doesn’t support the level—or speed—of segmentation needed to deliver the kinds of automated personalization needed to lead the market.

"People enjoy a high degree of effortless personalization within many of the digital experiences they access regularly. Traditional banks need to keep pace."

Bentzium Aviv, Customer Business Executive


Create segments of one

Personalization doesn’t have to be so difficult. Banks have an avenue to personalization that simplifies the process: more agile product lifecycle management (PLM). Your PLM processes and tools can sit on top of core banking systems, uniting the customer data within them. This approach allows for nuanced customer segmentation without needing to aggregate data outside core systems in a data warehouse. How nuanced? You can create segments of one. From there, you can easily deliver personalized experiences to customers.

Gaining this type of segmentation and personalization power enables banks to:

  • Upsell and cross-sell products using personalized banking product bundles
  • Innovate across your entire product portfolio
  • Empower product and marketing teams to develop personalized offers
  • Compete with FinTechs by taking advantage of deep customer insights

Real-world product innovation with personalization

The private banking world has an esteemed reputation for providing the ultimate personalized service to their clients. Everything for their clients is bespoke done by individual client managers, but this level of service comes at a cost. As many industries have seen the benefit of offering the personalized touch, including banks, the challenge is to offer this without the associated high costs, with advances in technology this is becoming more possible for many businesses.

Most of our banking clients want to offer a personalized banking experience without the expense and time drain of significant modifications to core banking systems. Core to any personalization service is offering several products ‘bundled’ to a customer that are relevant to them and their lifestyle, but this becomes near impossible without knowing who and how your customers engage with your banking services. This was the case for one client of ours. We implemented a product lifecycle management tool that sits on top of their core banking systems. It gave the bank a 360-degree view of customers to build profiles of different personas— and products relevant to those personas. In addition, we improved processes that shorten time to market for offers and promotions.

Another client wanted to continue their dominance in online banking, as they saw the highly personalized possibilities and speed of an all-digital banking experience could achieve with customer retention and growth. The digital world was offering clients a faster to almost instantaneous connection with banking services, but traditional approaches were too slow and the bank realized they needed to connect systems for their product, account, and relationship management. We provided a solution for them to give their customers the personalized service at scale, launch into new markets quickly and disrupted the region’s traditional market dominated by in-person branches.

Start personalizing banking experiences for everyone

At Amdocs, we work with banks to help them turn long-term relationships with customers into a competitive advantage. Beyond personalization, that can take the form of cloud adoption at scale, digital experience modernization, or supporting new ways of working. Talk to our team today about your digital goals. We’ll share our perspective, research, and expertise.


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