UK, Banking, Customer Insights, Machine Learning, AI, Data Analytics, Innovation, Business Case

1. UK BANKING INDUSTRY
GAIN CUSTOMER INSIGHTS
WITH DATA
NOVEMBER 2019

2. 2
WHAT IS OPEN DATA?
USING EXTERNAL DATASETS TO GAIN ACTIONABLE CUSTOMER INSIGHTS
Definition: Open (Government) Data refers to the information collected, produced or
paid for by the public bodies and made freely available for re-use for any purpose.
Open means anyone can freely access, use, modify, and share for any purpose.
• Data providers are public entities such as nation states, local government bodies,
public organisations, but also private companies and institutions.
Internal: APIs are used
by developers within
enterprise
Partner: APIs used by
business partners
(suppliers, providers,
resellers, and others) for
tighter partner integration
Public: APIs used by
external partners and
developers who build
innovative apps and
products
• The potential that data holds becomes even larger when
public sector information is combined with privately held
data.
• The benefits of Open Data are diverse:
• Performance: Improving efficiency and quality of
public services
• Economy: Developing innovative services and
creating new business models
• Social: Improving transparency, accountability and
enhancing participation
API Models
3 Types of APIs

3. 3
CREATING CUSTOMER VALUE
DATA CAN IMPROVE ALL ASPECTS OF RETAIL BANKING BY ENRICHING AND EXTENDING
CUSTOMER PROFILES SIGNIFICANTLY
Retail
Banking
Current
Accounts
Savings
Credit
Cards
Loans
Mortgages
Insurance
Holistic understanding of
customer insurance needs
considering family status, income
situation, asset diversification,
personal goals, risk aversion.
Advise customer on mortgages
considering instalments, personal
risk profile, property valuation,
cash-flow, future economic and
social outlook.
Personalise customer loan offers
with tailored services, revise
conditions of existing loans
dynamically (risk adjustment)
360° view of customers’ current
accounts allows personalised
recommendations, provide
incentives and help manage
spending more effectively.
Allocate customer savings
automatically considering
short/medium/long-term time
horizon, personal risk appetite,
and portfolio allocation.
Analyse spending habits and offer
discounts for credit card
spending. Holistic analysis
helping customers to build solid
credit score.

4. 4
ADDRESSING RETAIL BANK CHALLENGES
DATA DRIVEN SOLUTIONS TO RESPOND TO THE NEEDS OF CUSTOMERS
CUSTOMER PAIN POINTS KEY CHALLENGES LBG FACES COST TO BANK DATA DRIVEN SOLUTION
1
“Getting a new card
after I’ve lost it is
too complicated. I
just use Monzo.”
One customer, many banks, many apps
Customers are diversifying where they put their
money (e.g. current account & loan with HSBC, debit
card with Revolut, credit card with Amex, savings &
investments with Hargreaves Lansdown).
• Missing out on large volumes of daily
transactions and opportunities to
cross-sell into products with low-risk
returns.
• Poor customer expectation
management - No customer benefit
for consolidating financial services
with one provider.
• Build comprehensive customer profiles by
aggregating all financial products regardless of
provider in one unified app/user interface.
• Integrate external datasets (e.g. market rates
for saving accounts) and make
recommendations with better pricing for
customers (trusted advisor).
2
“I’ve been a
customer of yours
for years, why do
you still treat me
like everyone
else?”
Customer data isn’t being capitalised on
With huge amounts of personal data, retail banks
can and should be using it to offer customers more
tailored advice/experience: (demographic, purchase,
life stage based triggers)
• Low scores for personalisation & CX
metrics (NPS, CES).
• Missed cross-sell opportunities.
• Perception of LBG as a provider to
an advisor.
• Provide incentives for loyal long-term customer
(interest boost, special offers, unique
experiences) based on internal data.
• Affiliate programs to encourage promoting and
marketing of customers to potential new
customers using social media partners and
create external partnerships.
3
“My money is
important to me..
so I want to know
there’s someone I
trust behind all
these digital
services.”
Digitisation can lose the human touch
New digital channels are helping retail banks reduce
one of their biggest costs (head count, branches)
however, customer service & advisory services in a
digital world must still have a person at the heart.
• Lower scores on brand trust metrics
& customer satisfaction
• Increase in churn as customers
move to closest ‘physical’ branch
• Build customer community - online (forums,
social media) and offline (exclusive events,
sponsoring) and use collected data to improve
service offerings.
• Establish omni channel experience with
seamless customer transition across channels
using various datasets and optimize channel
mix based on collected data.

5. Wrap Up & Questions
Contact: Sven Von Dem Knesebeck
mail@svdk.me
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