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Predictive Analytics for Customer-Oriented Retail Banking

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Today, consumers demand more from retail banks such as customized products, convenient service, and even rewards for being loyalty. In a recent banking industry report from McKinsey Company, they pointed out that “most banks have never created a close relationship with their retail customers and understand little of their actual needs.” Although maintaining relationships with customers is critical, and many banks aspire to do so, only few can actually deliver.

Tailored service are rare in retail banking. While we notice that some investment banks are already on the path of using predictive analytics for product customization, the majority of retail banks have limited experience.

The developing trend of Big Data enables us to uncover complicated consumer behavior hidden in larger volumes of historical data. Leveraging IBM predictive analytics, Cresco International concentrates on turning raw data into business insights that our customers can use to solve crucial problems.

Using IBM SPSS Modeler software, we first combine data from different sources and in various formats.


Next, historical data is used to construct a model that correlates the characteristics of a group of customers with their financial behavior ranging from demographics, product choices and channels of purchase. Key metrics are identified within this set of measurements, as well as the likelihood of each customer group to respond to different marketing campaigns. We then are able to isolate various customer segments and create marketing campaigns or offers with products and services customized to them.

Through this analysis, retail banking will greatly benefit in saving marketing cost. For example, when the bank renews a client’s credit card, it can help to identify if the client is eligible for premier credit services and offer special terms for upgrading. Plus, it can also recommend new products based on the client’s profile, such as an investment account for clients with a large balance in their savings accounts.

Watch SPSS in action and how your bank can utilize Predictive Analytics, connect with Cresco today.

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