Aggressive Growth and Digitalization in FinTech Are Intensifying the Push for BI
The financial industry has radically changed since the crash of 2008. In those days, financial organizations’ efforts were focused on survival tactics and cutting costs. Today, the financial sector is looking toward considerable growth, and it has ambitious goals. According to the Peak 10 Financial Services and IT Study: Tackling the Digital Transformation, the vast majority of financial organizations have healthy IT budgets, bullish expectations for increasing revenue, and confidence in their ability to meet the hard demands of their customers through portals, applications, and the instantaneous delivery of data.
Also, the financial industry’s revenue expectations are ambitious, with 50% of financial organizations expecting their revenue to increase within the next two years, which will have a positive impact on IT budgets and decisions for the future.
The fastest path to growth for the banking industry is digitalization, and financial IT leadership is well aware. To grow, the financial sector has to continue to develop digital systems for every aspect of business operations, from customer portals and apps to digital marketing, data analytics initiatives, and as we’ll focus on in this blog, business intelligence (BI). Everything must go digital.
Gaining a Competitive Edge With Business Intelligence
If the industry remains par for the course in terms of growth, the market will become even more aggressive, with startups, large tech leaders, and traditional institutions all competing for the same customers, Dataconomy reported.
Needless to say, businesses need to use every potential force to gain competitive advantage, and as the industry continues to evolve, BI and analytics are powerful go-to tactics. insideBIGDATA explained that analyzing data leads to analytical insights, and it can be used for every business function, from sales and marketing to operations and product development. Understanding patterns in customer behavior, identifying how well sales are going, measuring staff performance, or assessing the success of a product are just a few examples of how it can be used. Ultimately, the detailed insights gained allow businesses to make better, more informed business decisions quickly.
3 FinTech Game Changers, Thanks to BI
Here’s what BI is bringing to the financial industry overall:
Enhancing the User Experience
Think about what’s becoming the legacy bank—customer/banker interactions aren’t necessarily seamless or particularly present. There are physical processes, paperwork, and traveling to and from the bank itself, no matter what a customer is trying to do. But this way of doing things is being eclipsed by the undeniable convenience delivered by online portals and mobile applications—the digital experience is a major point of disruption in financial services.
Consider Amazon’s “Buy Now” button. It allows customers to check out with a single click, and while it might seem like a small functionality, its basis is in BI. The “Buy Now” button was conceived of after analyzing data on user behavior through the purchasing process with the goal of reducing check-out time.
User behavior in financial services can be applied similarly. By observing how customers are commonly interacting with mobile applications, banks have the opportunity to tailor features and conceive of new services according to behavioral patterns.
- Monitoring Market Trends and Consumer Behavior
BI also enables the ability to monitor consumer behavior and track market developments. Analyzing data can reveal clear trends that allow financial organizations to refine strategies as soon as patterns are detected.
- Improving Security
Improved security and fraud detection have already been considerably successful in the financial industry as a result of behavioral analytics. Thanks to BI, financial institutions are able to recognize the typical purchasing behaviors of their customers and stop potential credit card fraud before it happens.
Financial organizations who haven’t already invested in BI and analytics should start evaluating tools and solutions as soon as possible in order to harness the business benefits they bring. Those who successfully operationalize a strong BI program will:
- Create an improved customer experience
- Identify better ways to engage the market
- Safeguard the business and its customers
Interested in learning more about financial industry market drivers, and how to gain competitive advantage? Check out the Peak 10 Industry Spotlight: Financial IT, to learn more, or contact us at www.peak10.com/contact-us or (866) 473-2510 to speak with one of our experts today.