Justin Orgel of Marigold: Industry Veteran Comments on Concerns Consumers Have Regarding Data Collection by Financial Institutions

We recently connected with Justin Orgel from Marigold, a global MarTech that works with over 40,000 brands and organizations worldwide to help them identify and create strong relationships with their customers.

The company offers industry-tailored MarTech and loyalty solutions that support the entire customer lifecycle and make it easy for brands to create long-term relationships, build loyalty and grow their businesses.

According to Marigold research, there are new insights regarding what consumers expect from their financial institutions. The team at Marigold explains that they help brands – including Hiscox, BNP Paribas, Alliant, Cigna, and others – gather zero-party data and develop stronger relationships with their customers.

In essence, Marigold issues an annual Consumer Trends Index, which surveys nearly 7K consumers worldwide. Part of that includes a focus on financial services and the preferences and expectations consumers have for the institutions they work with.

The firm shared the following:

  • They value privacy but expect personalization – 79% of consumers state that data privacy policies are important when it comes to financial brand loyalty. However, 70% are still willing to trade behavioral and psychographic data in return for a better service.
  • There is room for improvement – About 1 in 5 (18%) of consumers don’t feel their favorite financial services institution uses their data responsibly.
  • They’re nervous and look to their financial services provider for help – 60% reported feeling “very pessimistic” about both the rising cost of living and the economic outlook.
  • Keep it simple – Consistency in user experience across platforms is cited as the most important personalization tool (86%) by consumers.

Our conversation with Justin Orgel is shared below.

Crowdfund Insider: What are some of the biggest concerns that consumers have about how their data is collected and managed by financial institutions?

Justin Orgel: When thinking about the relationship between consumers and their financial institutions, trust is key. But the balance between a desire for personalization and how the data in which that is required is handled is where concerns arise.

For example, a sizable 79% of consumers stated in our recent Consumer Trends Index that data privacy policies are either important or critically important when it comes to their favored financial services institutions. However, consumers overwhelmingly love personalization too — with 70% prepared to share behavioral and psychographic data in return for a better service.

This is an important learning moment for financial institutions. As much as 79% of consumers think data privacy policies are either “important” or “critically important” in keeping them loyal.

Crowdfund Insider: Your research found that 79% of consumers see data privacy policies as important when it comes to financial brand loyalty.

However, 70% are still willing to trade behavioral and psychographic data in return for a better service. How is Marigold bridging the gap between a desire for personalization and concerns about data privacy?

Justin Orgel: It’s an important disconnect for sure, and one that we are actively working with clients to reconcile. It’s something that nearly everyone wants, regardless of industry – people want to feel connected to, and respected by, the companies they do business with. But they are also understandably concerned about the data they give up and how it is used.

At Marigold, we work with 40,000+ brands around the world to help them create more meaningful one-on-one relationships with their customers. Our goal is to empower true personalization, which essentially helps companies determine the services customers would be most interested in that are derived from preference insights that they have explicitly shared. In fact, we recently shared some enhanced abilities of our company that enable hyper-personalization at a scale that is a first for the MarTech industry.

Getting to truly know your customers and understand their preferences so that you can effectively tailor your offers and promotions is called zero-party data, and we believe it is the path to sustaining long-lasting, trusted relationships between customers and institutions. By leveraging progressive profiling and data gathering interactive experiences that offer the right value exchange, customers will willingly share this behavioral and psychographic data with the brands they do business with.

Crowdfund Insider: What are some of the biggest roadblocks for banks when it comes to creating relationships with their customers?

Justin Orgel: The biggest roadblocks for banks are how they use the data that they have. Financial companies have incredible amounts of data but are not always able to take action on it, and use it effectively in a way that creates better relationships with customers. This is sometimes about compliance but even more common due to disparate data systems and organizational silos.

In the case of retail co-branded debit and credit cards, we have found typically there is a disconnect between the financial relationship and the retail “marketing” relationship. The customer relationship is not enhanced but rather feels different in everything from communications to personalized experiences, rewards and offers (value exchange). This presents a big opportunity for most in the co-branded card space to connect systems, collaborate across functions, and deliver a more unified customer experience.

Lastly, for financial services firms to create better relationships with their customers, they need to adopt a relationship marketing approach. This centers on building long-lasting, personal connections that inspire a sense of trust among customers but also make their voices heard. Firms who ask what matters most to their customers and tailor their marketing tactics to those preferences are the ones who will be most successful.

for financial services firms to create better relationships with their customers, they need to adopt a relationship marketing approach Click to Tweet

Crowdfund Insider: Where do breakdowns in communication typically happen? Do you think the data collection challenges in financial services are unique compared to other industries?

Justin Orgel: For traditional financial services companies, organizational structure typically gets in the way. It’s a matter of the data from one area of the business not being accessible or leveraged for other sides of the business. When banks gather information about customer preferences, this data should be shared across marketing channels for better personalization of communications and offers.

We recommend that banks use current, real-time data as well as historical data to create a personalized customer experience as it is happening. For example, marketing teams can leverage this type of personalization to make recommendations for customers as they are actively browsing products or services on any owned channel to drive both customer engagement, spend, deposits or any other relevant business objective.

Crowdfund Insider: Are you starting to see banks change their approach to data collection and management?

Justin Orgel: There are inherent complexities that make data collection more challenging in finance. For one, it is a vertical where many consumers still prefer to conduct affairs in a branch rather than online, and as with all regulated industries, customers are conscious of being the victim of fraud – resulting in a reluctance to click call-to-actions in emails or respond to prompts by SMS. With merely 23% of consumers having made an online financial transaction in the last six months, this presents a unique challenge for the sector.

But, we are seeing Fintech disruptors continue to force institutions to reassess the way they do business. Modern consumers are becoming accustomed to 24/7 online support, personalized offers and all actions available at the swipe of a finger, yet still demand the watertight security and data protections synonymous with the sector. The pandemic was an accelerator of the trend toward digital banking.

we are seeing Fintech disruptors continue to force institutions to reassess the way they do business Click to Tweet

Crowdfund Insider: With nearly 1 in 5 (18%) consumers not feeling like their favorite financial services institution uses their data responsibly, do you think this can be resolved? If so, how?

Justin Orgel: Yes, we certainly do. There’s a lot of work to be done, with the sector less trusted than travel, groceries, restaurants, home improvement, household appliances and furniture.

And there are steps we are helping marketers take to achieve this. First, this starts with having transparent and clearly defined data procedures. We recommend asking customers for permission before initiating communications on new platforms. We also recommend ensuring customers have the ability to “opt-in” or “opt-out” of messages, and if a customer does “opt-in,” provide an explanation for how their data will be used.

We also think that companies should embrace data collection that customers are comfortable with, not ones they find creepy. For instance, consumers overwhelmingly view advertisements from unknown organizations based on location data (67%) and ads that follow across devices (61%) as creepy. However, many interactions are welcome. Recommendations from a financial services organization based on past conversions (79%) and personalized offers after visiting a website (60%) are viewed as cool.

Realizing and embracing these types of realities is crucial.

In addition, regulators around the world are stepping in to make sure banks are following regional guidelines around privacy, security, and data protection.

Crowdfund Insider: Do you feel there is room for improvement in how banks interact with their customers? What could they be doing differently and what are some strategies you are seeing that seem to be resonating?

Justin Orgel: Yes, there is. First, it is important to partner with a marketing provider that understands privacy, security, and governance requirements and the expertise to help build trusted relationships with customers from the point of acquisition through the entire customer lifecycle.

With financial services especially, customers want to feel seen while also protected. Overall, consumers will more likely engage with those companies that have taken the time to get to know them and who deliver personalized messages. Consumers are more likely to share zero-party data to create a relationship that is built on trust. Zero-party data helps pave the path to long-lasting, trusted relationships between customers and businesses. It is collected by leveraging progressive profiling and data from interactive experiences and most important, it is permission-based. With the right value exchange, customers are more likely to share behavioral and psychographic data which in turn opens the door to more personalized and relevant marketing in the future.

With data-driven solutions and in-depth insights, financial institutions can understand and anticipate customer behavior to make better business decisions and deliver offers that match customer value, stage, and life events.

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