Problem

A challenge in growing the wealth management business, which offered high margins and customer loyalty, was faced by the bank. The bank had a small client base in this segment, with low growth rate and high competition from other financial institutions. The bank needed to find better ways of identifying and attracting profitable customers who needed wealth management services, and retaining them by providing personalized and tailored solutions. The bank also needed to segment its market based on the needs, preferences, and behaviors of its potential and existing customers, and design effective strategies to increase its market share and revenue in each segment.

Solution

To address this challenge, the bank implemented a solution that involved identifying customers’ financial health and life events using data analytics and machine learning. The bank collected and analyzed data from various sources, such as transaction records, social media, credit scores, and surveys, to create a comprehensive profile of each customer’s financial situation, goals, risks, and preferences. The bank also used natural language processing and sentiment analysis to monitor customers’ life events, such as marriage, divorce, retirement, or inheritance, that could affect their financial needs and behaviors. Based on this information, the bank segmented its market into different groups with similar characteristics and needs, and customized its wealth management offerings and communication strategies for each group. The bank also provided each customer with a dedicated financial advisor who could offer personalized and tailored solutions based on their profile and life events. By doing so, the bank was able to attract and retain more profitable customers who needed wealth management services, and increase its market share and revenue in this segment.

Outcome

The solution resulted in improved customer satisfaction, loyalty, and retention rates, as well as increased cross-selling and upselling opportunities. The bank also achieved higher market share and revenue growth in the wealth management segment, compared to its competitors.