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Zero Party Data: Banks can now adapt their campaigns and services by “learning” to read users’ data

82% of banking entities think that their customers are happy with their messages. However (and here comes the surprise), only 39% of users consider their bank's communications to be really relevant. What is this difference about? It seems that entities continue to send messages that focus more on meeting their business objectives than on meeting the true needs and desires of the customers who use their products.

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This is the opinion of Myles Kleeger, president and commercial director of Braze, a company that brought these statistics to light a few months ago. Regardless of the underlying reasons, the reality is clear: there is a mismatch between the communication that banks carry out and what customers think about it. In this article we want to emphasize the best use of Zero and First Party Data, in order to improve the relationship between financial entities and end customers.

What is Zero Party Data? This mini guide will save your banking communications

Zero Party Data refers to the information that users provide to banks voluntarily. This is information shared directly by the clients themselves, without the participation of intermediaries. This data typically includes personal preferences, demographic information, and any other information that customers are willing to share during their interaction with the entity.

Banks and fintech use technology to improve efficiency, security and, of course, the customer experience. That is where several relevant aspects appear that they must take care of as guardians of personal information: data management and analysis. If the vast majority are willing to share personal information in exchange for preferential treatment, their job will be to optimize the processing of that information to get the most out of it. And at this moment the First Party Data appears on the playing field…

Personalization and improved customer experience with transaction data

Users want privacy and personalization. To achieve a value proposition that exceeds their expectations, it is important to complete the customer profile using First Party Data, information provided during the interaction with the entity. In the case of banks, transaction data becomes pure gold. It offers us a stream of invaluable daily information about spending patterns, purchasing preferences, risk behaviors, savings habits, investment capacity, and much more.

By collecting Zero and First Party Data, banks can get a more complete view of their customers and therefore their needs. This makes them financial allies, offering hyper-personalized products and services that adjust to the individual preferences of each of their clients. In addition, entities can launch their commercial offers at the right time! a month before insurance expires, the week before a subscription ends, when an unexpected income or expense appears… the possibilities are endless.

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Leveraging Zero Party Data is just the beginning

Yes, you have read it correctly… This makes it quite clear that the industry still has a large room for improvement. As it is data that is already available to them, it is possible to analyze it efficiently and respectfully to offer a unique customer experience. Consumers are becoming more connected every day and the use of digital payment methods is a constant source of Zero Party Data.

It’s all good news for the sector! With the right tools, they can now adapt that experience to each recipient in real time. Unraveling the particular attributes of each transaction is possible using so-called banking categorizers with data enrichment. This technology allows both banks and users to know where money is being spent: merchant, location, amount and carbon footprint associated with the purchase.

Leverage the power of bank transactional data

Financial insights shine a light on banking services

The aforementioned tools allow you to analyze different sources of information and discover the trace that users leave in their daily operations. Once their transactions are organized into categories and subcategories, it’s time to do the magic and show what the customer’s future behavior will be like, based on their transaction history.

This is not only useful for entities, but also represents a competitive advantage in customer service. We are showing the end user what their areas of improvement are in order to increase their financial health. As they now interact almost exclusively through online banking, the best way to make their life easier is to integrate innovative tools into it.

Helping them when important events (the birth of a child or buying a house) or unforeseen ones arise (an extra expense or an unexpected income), can make the relationship between a bank and its customer last a lifetime. It is as easy as scheduling alerts on the banking entities’ digital platform. With these automatic warnings, no unusual event will go unnoticed.

What you didn’t know about increasing your profits by investing in technology

Sometimes banks, either due to legacy methodology or limited ability to collect, store and analyze large volumes of data, choose to collaborate with a FinTech. This decision can save them important investments in infrastructure and innovation. Something important when the cost of acquiring new customers has skyrocketed… Furthermore, when choosing a bank, many consumers investigate whether they are trustworthy.

Standing out with a transparent attitude, high doses of empathy and multiple communication channels to resolve their doubts will make their choice easier. But what really differentiates one entity from another is the fact that they base their campaigns on real data. The information is at their fingertips and allows the entity to position itself as a financial expert that improves the quality of life of its users. It’s the power of Zero and First Party Data!

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