For many banks and building societies, legacy systems are a barrier for real-time, personalised customer engagement. Migrating experience platforms to a scalable, cloud-based platform, coupled with well-engineered decisioning, will enable banks and building societies to establish trust with consumers and subsequently maintain it.
The need for robust and reliable customer data
Banks and building societies are bound by financial services regulations to know the identity of their customers. Proper customer identification seeks to prevent criminal behaviour such as fraud, money laundering, or tax evasion. It is also a requirement for credit checks.
Having well-managed customer data enables lenders to identify the next best action for the customer, and create a customer strategy and journey tailored to each individual customer.
Inbound and outbound digital channels should be the ideal place to deliver these messages. But the use of digital technology is hampered by unfit processes and operating models that are combined with unscalable technology and batch processing.
With the right efforts to unlock the wealth of data held, the promise of real-time personalised messages that cut through the noise is very attainable for lenders.
Covid-19: a catalyst of change
The financial services sector responded quickly and earnestly to the challenges created by Covid-19. Payment holidays were offered, and staff were quickly relocated to home working setups to continue providing a good service.
The catalyst of change we all lived with created new levels of trust and empathy. This needs to be maintained by showing customers that the financial institutions really do care about them as individuals, especially in the current climate.
Mass mailings that push irrelevant products or services will erode that relationship. It shows a lack of care for the customer and a view of them as being a source of revenue and profit.
Making technology change last
To move forward, financial services marketers need to set a vision for the type of relationship they want to have with their customers.
This vision will determine the way that data is used, it will be at the heart of all campaigns and communications, it will alter working processes so that the organisation becomes more empathetic.
Through a clear and uniting vision, marketing technology will really be able to prove its value. Not just in delivering a better campaign, but by shaping the very experience and interaction an individual has with a brand. It will be about two-way interaction.
For useful input from over 200 financial services brands, 1,500 marketing leaders in the financial services industry and 5,000 financial services consumers, on how you should be evolving your customer marketing strategy to meet the needs of a changing consumer, download this recent report from CACI and Braze.
Check out the previous parts of this blog series below:
With new guidance in the FCA’s Consumer Duty directive, the financial services industry is being asked to get to know their customer better and meet their diverse needs. In a recent report produced by Braze & CACI, providing insight for financial services brands, it was found that 42% of EMEA consumers only use one financial services brand – so how can you retain their loyalty, trust and keep them engaged?
1. Technology Innovation
The general insurance market has always been challenged with engagement, as the frequency of communication with its policy holders is low and concentrated at the point of policy inception, claim or renewal.
However, building trust is still crucial in this market.
Every insurer is now looking for new ways to harness technology for growth and competitive advantage. The use of AI and innovative tools is becoming more prevalent in the underwriting, claims and CRM process.
Harnessing your customer data through modern decisioning tools, and leveraging third-party demographic data to build a more holistic understanding of who your customer is, enables you to interject hyper personalised communications throughout the life of the policy, via the most appropriate channels, and actively give policy holders transparency over potential changes in premium.
2. Building Trust
Whilst insurance may be seen as a “necessary purchase”, the payments aren’t usually greeted with good sentiment or the feeling of value for money.
However, the data and insights that much of this new technology generates creates the opportunity to engage policy holders more during the life of their policy.
For example, in car insurance, the use of telematics data could be used to talk to customers regularly about how they can improve their driving whilst reducing the cost at their next renewal. It’s well understood that people feel a sense of dread when a renewal comes around, fearing a policy price increase without a clear reason. As an insurer, why not reduce this surprise and help your customers maintain or reduce their premium?
If the data used to run the underwriting model changes, meaning that the car insurance policy may go up at renewal, it is better to let the customer know this early and explain why this has happened. This would increase trust and loyalty, reducing the likelihood that they might go to an aggregator when the renewal is due.
Even better, utilise predictive analytics to warn customers early of changes, enabling them to make changes in behaviour to help keep premiums down.
3. Understand your competition
The insurance market is made up of large general insurers through to niche specialists. Whilst brand reputation has a role to play, the heavy use of aggregators to seek out favourable deals is commonplace.
The opportunity is there for the more established brands to innovate and use their capability to invest in and truly leverage marketing technology and data to create a more trustworthy experience. For niche players, they can utilise their positioning to clearly communicate the benefits of their USP to customers.
With restrictions on the use of incentives for new consumers, all insurers need to consider other important elements of their offering and communicate this throughout the experience.
Throughout this blog series for the financial service industry, we break down the opportunities for marketers to build trust, loyalty and a superior customer experience with data and technology. Continue reading at the links below:
Our recent report, created in partnership with Braze, found that only 53% of financial services brands use advanced techniques like event-based and attribute-based personalisation when it comes to customer communications.
Using modern customer engagement technology will help financial services brands humanise the experience with their customers – as personalising each interaction using sophisticated decisioning algorithms will make the individual feel acknowledged. Real-time customer MarTech can manage two-way dialogue with customers, engaging them with the right content at the right time.
Great experiences start from the first contact
As the market grows ever more competitive and it becomes easier than ever to switch providers, creating the right first impression for your customers is essential.
It’s often thought that successful customer onboarding requires the customer to share a lot of data, but with the right customer strategy, marketing technology and third-party demographic data you can create an onboarding process that’s right for your customer without asking for more than your customer is willing to provide. Registration processes should be simple, not prohibitive to engagement, and show clear reasons for data collection. Consider neo-banks such as Plum who gamify their onboarding journey and make it simple to become a customer.
Collecting marketing consent is an often-neglected part of the sign-up process, with a series of check boxes tucked in at the end just before the terms and conditions acceptance. Improved consent processes are geared towards signing up for specific engaging content or benefits.
Education and transparency
Even though people are visiting branches less, it is still possible to create real trust through educating customers to support their decision making via your digital channels.
Many progressive banking and building society brands are now using interaction and behavioural data to point their customers to educational posts or feature tutorials. Brands can therefore help their customers to meet their individual goals, whether it’s to stay on budget, boost their credit scores, save for a new home, or other major life purchases.
Teaching customers to make the most of the digital tools available to them, and explaining how to achieve their financial goals, will demonstrate care and support. Additionally, being connected with the customer’s long-term ambitions means that bank and consumer are together for the same reason.
Humanising the experience
With Covid-19 accelerating the use of digital channels, the online experience needs to build trust by clearly acting in the customer’s best interests, like an in-branch customer service representative would.
Humanising the experience using empathy is key to this. Creating warmth and understanding around life events, in the same way a customer service representative would, is a powerful way to build that bond with your customer.
It’s critical that the customer journey promotes the value your brand brings by using every interaction, no matter the channel, to reinforce how each individual customer can financially better themselves.
Throughout this blog series for the financial service industry, we are breaking down the opportunities for marketers to create a personalised customer experience, and build brand loyalty through central decisioning engines, marketing attribution models, data modelling, machine learning and AI-driven recommendations. Continue reading at the links below:
For recent insights on how your customers feel about the experience they receive from their financial services providers, and for guidance on how you can better understand and meet shifting customer expectations, download our recent report – Banking on the Customer Journey.
• Bespoke data dashboard and InSite tools
• Acorn geodemographic data for multiple propositions and locations
• Customer and employee profiling to assess community need
• Enabling demand-led growth for genuine customer value
• Rapid report generation to inform many stakeholders
About Bright Horizons
Trusted by families to look after their children for over 30 years, Bright Horizons is an award-winning nursery provider. The company operates over 300 community and workplace nurseries throughout the UK: each is individually designed to serve the needs of its community. Bright Horizons provides tailored childcare for corporate clients and for families, at home, at work and in local settings.
The Challenge
Bright Horizons initially approached CACI for data to support their new site opening and acquisition insight programme. Property Asset Manager Oliver Brookes needed reliable data that was quick and easy to interpret for new site and location decision-making.
Marketing Manager Eddie Thorogood saw a further opportunity to use demographic data to support Bright Horizons’ proposition development and to better understand existing as well as potential catchments.
The Solution
CACI provided Acorn demographics, profiling and mapping, giving insight into specific postcodes and communities. High level demographic maps are instantly visible in InSite’s Locator tool.
Eddie explains: “The blend of data creates reliable and up-to-date information about the demand for our services, to support decision-making about how and where we can expand our operations so we can deliver high quality childcare where it’s needed. It also helps us improve our business model, so we can manage our portfolio and flex and balance our sites to meet changing needs.”
The Benefits
Bright Horizons’ three pillars are ‘people, quality, growth’. Eddie emphasises, “We’re not about just growing for the sake of it. We always want to be where we are needed – where parents can find us and our services will be useful. With this data insight at local level, we can provide a clear picture of community and workplace need to our senior leadership team, so they can sign off new facilities.”
Eddie explains
We have a complex business where everything is audience-centric, so we have multiple offerings. It’s a deeply human business – it’s all about nurturing young children.
The CACI data and dashboard reporting gives us tools to look through every single lens, to understand all the factors that matter to people.
Eddie Thorogood, Marketing Manager, Bright Horizons
The evidence is clear, Covid-19 accelerated the pace of consumers’ changing behaviours.
Our analysis on consumer attitudes towards returning to branches highlighted a 32% reduction in bank branch visits post-covid, with even the most resistant to channel shift turning to apps and websites to manage their finances.
This is against a backdrop of other changes in the UK’s financial services sector that are impacting marketer’s abilities to connect with customers and prospects.
Retaining your savvy savers
Rising interest rates mean that people are becoming incentivised to both start saving again, and to switch savings accounts again, with savvy savers searching for the best deals.
Our recent consumer insights have found that the younger demographic are still expecting to save in the next 12 months. And it is to be expected that your competitors will increase their efforts to attract your savers to their products. You need to be ready to retain them!
Buoyant lending with a shift to the suburbs
Across the UK we saw a shift from the cities to the suburbs, driven by the opportunity to work from home more regularly. A reduced commute and a chance for more space was an opportunity many felt could not be missed.
Coupled with the government provocation of the housing policy, using changes to the stamp duty tax threshold, there has been an incredibly active homebuyer market.
However, recent economic factors have driven up the interest rates available on new mortgages and to those coming to the end of their fixed deals. Consumers are therefore incentivised more than ever to find the best available deal. This becomes a potential flash point for marketers who need to develop trust with customers so that the retention battle can be won.
Insurers need to rethink incentives
New legislation from the FCA means that insurers must be willing to offer the same incentive to new and renewing customers. Past use of aggressive incentives to win new customers’ needs to adapt to regulatory challenges.
Like the other macro conditions, this requires marketers to engage in longer-term marketing journeys with potential consumers, to win them and retain them with value driven propositions.
The need to communicate with the individual
Whichever way you cut it, there’s a lot of change to contend with for the financial services marketer.
From CACI’s perspective, we see there being winners and losers in the market across banking, lending and insurance.
The winners will be those who utilise data and technology to serve customers as individuals. To maintain engaged relationships based on trust and demonstrate how the brand is taking care of the financial interests of the individual.
Throughout our new blog series for the financial service industry (starting with this blog), we will break down the opportunities for marketers to address these challenges through central decisioning engines, marketing attribution models, data modelling, machine learning and AI-driven recommendations. Continue reading at the links below:
For insights on consumer attitudes towards their financial services provider’s marketing and communications, download this report, created by Braze in partnership with CACI. With input from over 200 financial services brands, 1,500 marketing leaders in the financial services industry and 5,000 financial services consumers, the report uncovers a surprising disconnect between what banks think and how customers feel. It also provides guidance for brands in the financial services industry to better understand and meet shifting customer expectations.
First launched on 10March 1801, the UK census is a decennial questionnaire undertaken by the Office for National Statistics (ONS), National Records of Scotland (NRS) and Northern Ireland Statistics and Research Agency (NISRA) that asks a variety of demographic questions on age, sex, marital status, health, education, and housing.
The primary purpose of the UK census is to build a detailed snapshot of society at that current point in time. Helping national, regional, and local governments understand the people and households in their constituencies. This allows these government agencies to develop current policies or create new ones, as well as plan and fund services, including education, medical facilities such as doctor’s surgeries and hospitals, and transport infrastructures such as roads and new train routes.
The census is also used for other purposes, helping organisations and companies understand the society they interact with. This includes:
Voluntary organisations using census data as evidence to support any applications they make for funding.
Academics and Education Institutions use census statistics to support research that they are working on.
Businesses using census information to help them understand their customers more effectively, i.e., a retail chain might use census population data to help decide where to open a new store.
How often is the UK Census, and when is the data released?
The census is run every ten years and typically collects information from the public in the first quarter of the calendar year of the decade. ONS for England and Wales, and NISRA for Northern Ireland had a Census Day on 21 March 2021. However, on 17 Jul 2020, NRS recommended to Scottish ministers that the 2021 Scottish Census be moved to 20 March 2022 due to the COVID-19 pandemic.
The responsibility for running the UK censuses is split between ONS, NRS and NIRSA based on their geographic region. The Office for National Statistics hass overall responsibility for publishing census records and statistics for the whole of the UK.
The data from the census is typically released in phases. For instance, in the first phase for England & Wales, local authority level population and household estimates were released, in June 2022. The three census offices each have their own timetable, with outputs staggered across a period of one to two years.
Because Scotland’s censustook place a year after the rest of the UK, reference dates will differ. This will impact the comparability of UK census data, for this version.
Due to this, the three census offices are working closely to develop UK-wide census records, which involves consideration of how best to meet the challenges around comparability, coherence, timeliness, and accessibility of the information.
Below is an approximate timeline of the different subject releases based on the various census offices.
KEY
LA POP – Local Authority Population Data
HH – Household Estimates
OA – Output Area
CACI and the UK Census
CACI has been processing, analysing, and modelling Census data since 1976, when we became the first Census Agency in the country.
The data from the UK census is used as input for many of CACI’s products, including Acorn, Address Spine, Ocean and Fresco. A wealth of companies uses these products, public sector bodies, charities, and not-for-profit organisations to help them understand their current customers, constituents, or beneficiaries more effectively, as well as market their products and services to like-minded individuals that fit the same demographic profile of their existing customers, saving them both expenditure and resource.
We also use the census as the baseline for CACI’s annual Up-to-Date Demographicsrelease, which providesthe latest estimates of key census variables (e.g. age, housing tenure, presence of children). These are modelled forward using various, more frequently updated data sources. As the census is carried out only once every ten years, this provides an increasingly more reliable view of the population than the census data itself. Up–to–Date Demographics is available at census output area level. Consistent with this and for even more complex use cases, our annual Population and Household Estimates and Projectionsprovide counts down to individual postcode levelsandproject forward for future years.
The first results of Census2021 were published on Tuesday, 28 June 2022. These provided estimates of the number of people and households in England and Wales at local authority level. From this data, CACI was able to provide insight into the data to help:
The Ageing Population – The ageing population shown by this census follows our own predictions very closely, so it comes as no surprise. It does however throw up two significant questions. Firstly, what does this mean for pensions? With proportionately fewer working people to retired people, will there be a greater emphasis on private pensions to cover the state shortfall? And secondly, what does this mean for senior living facilities? We’ve recently been pushing the message that senior living needs to be looked at more rigorously in terms of its role within the wider housing stock and that all types need to be taken seriously. The 2021 census only serves to vindicate that, and we would encourage local authorities and senior living developers or providers to engage with the data now to understand what their existing and future residents need, to ensure we have a fit-for-purpose housing mix for an ageing population.
Regional Growth and ‘Levelling Up’ – It is great to see regions other than London taking the top spots in terms of population growth. It finds itself behind the East of England and South West, and in joint third place with the East Midlands, in terms of percentage increase. More noticeable for their omission from the top of the charts are those regions further from London. Wales, the North East, and Yorkshire and The Humber are lagging behind quite significantly in terms of population growth, suggesting that the pull of living within reasonable commuting distance of London is still strong. Salaries of course have a big role to play – the closer you are to London the higher both salary and disposable income tend to be. The growth we’re seeing in the census is more or less restricted to the southern part of England, so there is clearly a lot of work to be done with the ‘levelling up’ agenda, to entice people further away from the capital.
New release
On Wednesday, 2 November 2022, ONS also released their Demography and Migration Datafor England and Wales, their second release of Census 2021 data as part of their topic summaries.
This includes an update to population and household estimates for England and Wales, which now includes unrounded data by sex and single year of age, providing even more detail on individuals who were previously in age bands. This meant that on Census Day, the size of the usual resident population in England and Wales was 59,597,542, which was the largest population ever recorded through a census in England and Wales. This meant that the population grew by more than 3.5 million (6.3%) since the last census in 2011 when it was 56,075,912.
It also contains information on household and resident characteristics, including household size, composition, deprivation status, and people’s marital and civil partnership status. Providing detailed insight into the makeup of the 24.8 million households across England and Wales. Such as although the number of households has increased to 24.8 million (up 6.1% from 23.4 million in 2011), the average household size in England and Wales in 2021 was 2.4 people per household, which is the same as in 2011.
Migration data is also included in this release providing further information on country of birth, passports held and year of arrival, helping us to understand internal and international population changes. For instance, of the 3.5 million (6.3%) increase in population from 2011 to 2021, 57.5% is positive net migration (the difference between those who immigrated into and emigrated out of England and Wales).
Objective basis for strategy and resource allocation
About Northumberland County Council
Northumberland County Council looks after a population of over 320,000, in England’s most northerly county. Northumberland is one of England’s five largest counties, with widely distributed towns and communities of varying types and populations.
The Challenge: Understanding the needs of different neighbourhoods
Senior Economic Analyst Julie Dowson provides data to departments across the council, from housing and planning to public health and regeneration. She says:
“Our communities have such wide differences – it’s really important to look at them at a granular level and compare them. That’s where the Paycheck data comes in. We need current, household level information to understand exactly where people are experiencing challenges, so the council can target plans and funds to address them”.
The Solution: Household-level Paycheck data reveals areas of need and opportunity
Northumberland County Council also uses Paycheck insight to feed into its annual Economic Performance Assessment and five-year economic strategy. Julie says, “You can’t plan based on subjective assumptions – the Paycheck data provides objective evidence to support our policies, priorities and programmes. That means everyone in the Council as well as our partners and customers can see and understand why we’re focusing our resources in particular areas.”
The Benefits: Targeted help and support for towns and communities
Northumberland County Council used Paycheck data to inform its Local Plan. The outputs influence Strategic Housing Market Assessments and Land Assessments, which identify potential locations for additional housing and indicate what land may be released for future housing development. This helps Northumberland County Council to plan enough affordable homes to meet residents’ needs in different housing developments across the county.
Accessible, visual information for a wide audience
About Dumfries and Galloway Council
Dumfries and Galloway Council is responsible for the delivery of all local authority services to nearly 149,000 people living in both urban and rural areas in the southwest of Scotland.
The challenge: Understanding the needs of different neighbourhoods
Gregor Docherty is Dumfries and Galloway Council’s Economic Development Officer. He explains: “Although we have some data of our own, we don’t have the range and breadth of it to provide the information the council needs today. I was given the challenge of improving our data insight, to give us a clearer view of the areas the Council looks after and the needs of the people who live there.
The solution: CACI’s data provide valuable insights
Dumfries and Galloway Council has access to Paycheck income data for two years. Recently, Gregor decided to add the Household and Wellbeing Acorn datasets to the subscription.
The addition of Household and Wellbeing insight provides a granular picture of lifestyle, income and risk factors at a local level, so we can really examine areas of need and deliver value and impact from the council’s services and programmes.
The benefits: Clear, trusted and detailed insight into household income change
Dumfries and Galloway Council successfully applied for Borderland Inclusive Growth Deal funding, using information modelled from CACI’s data. Gregor created a Dumfries and Galloway datazone profile, bringing together all the available information to rank the towns in the Council’s area for funding priority. The analysis revealed the four priority towns for funding, which was approved.
As with every industry Grocery Retail has had to adapt to a seismic shift in consumer attitudes and behaviour.
And those attitudes and behaviours continue to shift in response to local, national and even global events. The consumer has weathered the pandemic but is now staring down the challenges borne out of a cost of living crisis.
So, you need to make important decisions, and quickly. Flexibility is key. Having the data and tools at your disposal to make anything from adjustments that impact fine margins, right up to transformational change, is essential.
An innate understanding of your customer – their attitudes and behaviour – gives you the insight you need to attract new customers and retain existing ones. It’s also the foundation to building strong brand loyalty, even in challenging times.
CACI know more about your customers than anyone else. We combine a market leading demographic classification system with highly detailed footfall and spend data to provide you with everything you need to know about the way customers interact with your brand, your locations, and your competition.
For confident decision making, for greater market share, for sustainable and accelerated business growth – make your strategic location intelligence partner CACI
Strategic decisions need strategic insight
CACI offer unrivalled insight into the fundamental relationship between people and place. Understanding this relationship speeds up decision-making and minimises risk from Cap Ex investment.
We are supporting grocery retailers with insight on:
How customers engage with your brand in a physical and digital environment
The demographic profile of the catchment of each of your stores
The spend potential of the catchment in any location
The shifts in footfall and spend across times of day
The profiles of customers engaging with your competitors
Other locations similar to your best performing sites
Data driven network expansion driving the most ROI
Creating the right formats for the right locations to serve the local communities
At the end of this work, we had a growth plan to refer to, which meant we could prioritise and focus incoming opportunities. With tangible, data-led evidence and a well-defined process and criteria, we could make decisions more quickly
MidCounties Co-operative
Unprecedented insight into the grocery retail market
Understanding the way customers interact with your brand, and how potential customers engage with your competition, is the first step to increasing your market share.
And with a complete view of the competitive landscape both nationally and locally, you will have the tools you need to develop strategies for success.
At a customer level you can:
Discover the demographics that are drawn to your brand
Discover those that aren’t and why
Find out when they spend, how much they spend and what they spend their money on
Drive customer loyalty and win larger share of wallet
Identify highest spending customer groups and locate more of them
At a location level you can:
Find out where your current and potential locations rank in terms of spend
Benchmark locations against a national average across a range of criteria
Model catchment areas and market share catchments
Forecast how a particular location will change over time factoring demographic shift
Understand your local market share and competitor spend
Identify key growth opportunities in your store estate
Inform partnership strategy to generate greater footfall
Measure impact of your and competitor activity, e.g. marketing, store refurbs, etc
The CACI Consumer Spend Data has been instrumental in Sainsbury’s breaking new ground in our understanding of the evolution of multi-channel grocery. With it we can now observe changes in consumer spending and preference across channels at both national and local level and can see market dynamics play out in near real-time
Sainsbury’s
The analysis to understand the digital / physical dynamic
The relationship between physical and digital has evolved, and demographics more inclined to visit a store are now comfortable online.
How has this affected your store network?
And how does online halo impact your performance across your physical store network?
Different demographics behave differently and will even favour different brands for different channels.
CACI can make sense of this and measure the success of each of your locations well beyond just what goes through the tills. Your best performing site might not be so obvious!
Optimising your store network with this analysis in your hands allows you to make the right decisions without negatively impacting on your multi-channel revenue lines. Future proof the business by effectively forecasting online as well as in store grocery demand.
Get in touch with us to show you how we do amazing things with data.
