Why is cross-selling still so difficult for banks?

Is strict regulation to blame for the lack of cross-selling activity from banks, particularly on mobile channels?

In our recent Insight Series Report, Effective Selling on Mobile (check out a free sample here), we looked at how banks are approaching the challenge of selling on mobile. Noting that brands in other industries have overcome the problem of a smaller screen, and responded to growing trends in smartphone usage, we concluded that most banks still struggle to engage both new and existing customers with their products.

While it’s easy to argue that even the most mobile-obsessed consumer isn’t likely to browse a bank’s mobile site hoping to get inspiration (although this isn’t the only route for acquiring customers), it’s harder to see why existing customers – those who check their balance and make payments on their phones every day, clearly love the mobile channel for banking, and whose data the bank in question has been collecting for years – aren’t an easy target.

Well, there is one obvious problem. While we see plenty of examples from new ‘banks’ and banking services – designed for mobile, naturally – of pushing other products at customers, we must remember that these brands don’t yet face the bane of all creative marketing efforts: strict regulation.

The examples I’m thinking of are account aggregators. Most good account aggregation platforms will collate your financial data and use it to sell you stuff. Pariti and Prosper Daily are just two examples; we expect many more to emerge as those much-promised APIs start functioning…

Cross-selling Pariti

Is this clever cross-selling or worrying advice? Can you really tell a customer in debt that a credit card will sort them out, when the ‘right’ advice is to pay off what you owe? Is a minimum loan of £1000 essential for someone with £775 to pay off?

Still. When the bank holds so much data – lifestyle, transactional, demographic and increasingly mobile behavioural data and geolocation shizzle – they can surely do better than generic offers to the inbox every so often. Barclays does promote a personalised loan offer, reasonably subtly, in the mobile banking app – a good example, we think, of not just taking advantage of an app user’s attention to increase their value/loyalty to you, but of taking the time to personalise promotions.

Amazon does it well, offering recommendations and suggestions based not only on the data they have on the product and the customer, but on data collected from scores of other customers. ‘People like you like this.’ As I’ve argued before, segmenting only by the year a customer was born (an assumption of life stage) is lazy… and unnecessary for a brand that should know so much. And, unlike challenger banks, incumbents ought to have a data advantage. Not just a few thousand app users and one ‘banking product’ – these guys have been around for ages, racking up millions of customers who may hold multiple products there. Amalgamating and analysing data may be challenging when you have so much of it, but the insights will surely be richer.

We’ve seen so many promotions hit our inboxes and door mats that feature products we already own, or aren’t remotely suitable for us. While my local takeaway can be forgiven for not knowing I’m on a diet, the bank I’ve had since I was 12 should really know me pretty well by now – especially as I give them so much juicy data through constant interaction with, and use of, the mobile app.

Regulation isn’t to blame. If the full gamut of customer data was better organised, structured and shared across internal silos, with bank-wide strategies for cross-selling wisely in place, customers would see tailored offers in the channels they actually use, and be far more likely to convert to sale. As with any brand, consumers ignore adverts that aren’t relevant. Banks have the trust and data to be relevant, even in a fast-moving digital world.

Read a sample of our report ‘Effective Selling on Mobile’ here. Want to see what your competitors are doing online? Contact us today. 

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