During the financial crisis, the growth rate of the banking sector witnessed a narrow decline.
Over the last couple of years, the banking industry has started facing unprecedented challenges in terms of stringent government regulations and advent of disruptive models and technologies. Due to the presence of numerous private banking firms, the major companies in the industry have started focusing on developing new strategies for sustainable growth. Additionally, despite the weak economy, prominent companies in the private banking sector are also planning to reshape their organizational structure to improve their financial performance and ensure continuity in their service offerings.
Some of the factors that may curtail the growth of the private banking industry include:
- Heightened customer expectations: In this service-driven economy, it becomes essential for the companies in the private banking industry to deliver the level of service that consumers are expecting. Moreover, as innovations keep piling, companies face pressures when it comes to improving their existing technical capabilities and service efficiency.
- Increasing competition from financial technology companies: The rising competition from financial technology firms is disrupting the way traditional banks function. As a result, prominent fintech companies have been compelled to utilize advanced software techniques to provide financial services. It, therefore, becomes a necessity for companies in the private banking industry to adapt to the changes.
[spacer height=”20px”]To address such challenges and understand the preferences of the customers, businesses are utilizing customer segmentation studies. In the case of the private banking sector, customer segmentation helps businesses divide potential customers into discrete groups based on their needs and the buying behavior. Customer segmentation also allows businesses to validate customers’ expectations for a specific service that is being offered.
The Business Challenge
- The client- A renowned private banking firm
The client, a renowned private banking firm, wanted to define and target the best prospects and adequately allocate resources to meet the business requirements. With the help of Infiniti’s customer segmentation solution, the client wanted to gain relevant insights about their customers and identify the most and the least profitable customers. Moreover, the private banking firm wanted to profile the customers that are most likely to buy the products and services. The primary objective of the client was to deliver an omnichannel marketing solution to improve customer interaction and engagement.
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The customer segmentation experts at Infiniti carried out extensive research comprising interviews and discussions with prominent stakeholders in the banking industry. With the help of trade shows, company presentations, and industry forums, the experts also gained relevant insights into the current market drivers and trends.
The Solutions Benefit and the Business Impact
The customer segmentation solution offered by Infiniti helped the private banking firm to meet the relentless demands of the customers through targeted offerings. The private banking firm was able to understand the preferences of the customers better and accordingly allocate their marketing resources to gain the desired results. In addition, the solution also helped the client tailor offerings for the segments that are profitable and develop marketing strategies and pricing strategies to generate maximum value. The private banking firm was further able to measure the performance of each individual segment and adjust the segmentation strategy over time.
A must-read case study for strategy specialists and decision makers looking to develop an understanding of the private banking sector