SINGAPORE (July 20): The next generation of digitisation in financial services will propel the industry into the knowledge economy. More specifically, financial services firms can look forward to a future of using more contextual knowledge and understanding of their clients to generate tangible economic value.

Maximising consumer behaviour insights
China provides an instructive case study on making optimal use of the time that clients spend outside of a company’s digital channels. According to Statista.com, the amount of time the Chinese spend online has risen more than 40% over the past five years.

This growth has coincided with rapid growth in the use of mobile internet, a trend that we expect to continue. Thus, it is important for any business with growth ambitions to find out more about customer behaviour via data analysis to better understand and meet their needs, thereby increasing customer loyalty and potentially enhancing profitability.

In China’s consumer industry, Alibaba is particularly advanced in terms of big data analytics – Forbes.com estimates that the company holds almost 80% of China’s PC, internet and app data. In addition to this wealth of online consumer data, the company cooperates with bricks and mortar retailers to deploy WiFi sniffers that can track traffic in offline stores, creating a particularly powerful database.

These enormous troves of data give Alibaba unprecedented insight to consumers’ on- and off-line behaviour. The company can leverage this data to simultaneously tailor the online shopping environment – in terms of products and services – presented to individual shoppers while also presenting them with tailored content and advertising when they visit seemingly unrelated websites.

Really know your clients: Follow the cookies
How might this translate to digitised financial services? If you know your client has a particular interest or need, you can act on this by ensuring it is reflected on your customisable user-interface (not just, ‘Hello customer’, but, ‘Welcome back John, can I provide you with some information on..?’).

More importantly, as is the case with Alibaba, you can also draw the customer back to your user interface by ensuring contextually relevant content is highlighted in your online marketing presence across other sites. This is increasingly possible as the next generation of fintech companies transfer consumer industry best-practices in behavioural analytics and machine learning to financial services firms. 

Similarly, a client might visit an investor platform to research stocks they are considering purchasing. When the client leaves the investment advisor’s website, he or she will take a ‘cookie’ with him – a bit of code which tracks the sites they visit on the wider web. Going forward, the firm can combine data about that client’s stock purchases with the behavioural data and other information gleaned via the cookie to build a more accurate picture of potential stock purchases they may be interested in.

Many banks are beginning to embrace digital transformation, recognising the opportunity of enhance the user experience by delivering customisable services across multiple platforms. But the full potential of such investments will not be realised if banks and other financial services firms don’t continue to push the boundaries, exploring the opportunity for digitisation to help them better understand and fulfil clients’ needs and desires.

Big data maps products & services to client needs
Converting client interests into financial transactions is the goal. Using big data to evaluate a client’s knowledge, experience and investment risk tolerance is a powerful way to better equip financial companies to present the right investment opportunities to specific investors.   

Adam Reynolds is APAC CEO, Saxo Capital Markets