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2021 Eye on Payments: Part I – Consumers’ Increasing Need for Personalization

By: Tom Pierce, Chief Marketing Officer, PSCU

Nearly 20 months after its emergence, the COVID-19 pandemic is still impacting the U.S. economy and consumers, as well as the global economic landscape. The economy and its outlook have ebbed and flowed throughout 2021, with varied consumer confidence and spending levels coupled with labor shortages and supply chain issues arising from the dynamic pandemic environment. Through all of this, one constant has been the increasing need for personalization in almost every aspect of consumers’ lives.

Welcome to Part I of our blog series on our 2021 Eye on Payments. PSCU’s fourth annual consumer payments study, released on Oct. 26, examines payment preferences among credit union members and other financial institution customers (“non-members”) across the U.S., including how they evolved over the past year. Through this research, PSCU explores the factors that influence consumers when it comes to their usage of traditional and emerging payment methods across multiple payment scenarios and how social and economic events impact payment choice. The study also explores how and why payment method preferences differ among generations and regions. Key takeaways are provided that credit unions can implement to better meet evolving payment preferences and member needs.

In this first blog from our 2021 study, we highlight the demand for personalization.

Personalization is critical.

Consumers want and expect personalization across all facets of their lives. Tech giants like Amazon, Netflix and Spotify, among others, have introduced extreme personalization to consumers when shopping online, ordering groceries, watching TV or listening to their favorite podcast. When we make a purchase on Amazon, we see suggestions for similar or complementary products. After watching a movie or television show on Netflix or other streaming services, we are shown additional content that we might be interested in watching. If you start a grocery delivery order but get called away from the app, an email is delivered reminding you that you need to finish your order and provides suggestions for other food you might need based on what is already in your cart. Personalization has seeped into the fabric of our lives – so it’s no surprise that consumers are now expecting this type of customization from their financial partners.

2021 Eye on Payments found that nearly eight out of 10 survey respondents agree or completely agree that they want to do business with a financial institution that knows them personally. Additionally, more consumers are choosing how they transact – and with which payment method – based on their personal preferences, with more than half of all respondents (62%) noting that they use a greater variety of payment methods than they did a few years ago.

There are a number of channels for credit unions to consider when it comes to personalization. One example is to set up personalized, automatic emails based on rules to target segments of consumers who need additional financial assistance or reminders to maintain their financial health. A proactive and meaningful connection like this can reduce consumer anxiety, strengthen engagement and increase loyalty through the entire lifecycle of the relationship.

When it comes to individualization and banking relationships on a regional level, Texas residents surveyed stand out from the rest of the nation. In fact, 87% of respondents from the Lone Star State say they agree or completely agree that they want to do business with a financial institution that knows them personally. The data is even more compelling for credit unions, with 94% of credit union members from Texas in agreement with that statement.

Now is the time to shift the narrative.

It is now an opportune time for credit unions to leverage the right tools and data to establish a different kind of engagement model driven by analytics: an opti-channel approach which enables credit unions to use data to deliver unique experiences based on where the member is along their financial journey.

Current tools enable users to start activities in one channel and complete them in another, but today’s members are conditioned to expect more. Credit unions can help create experiences specific to each member and their individual needs based on the value the member represents to the credit union by doing the following:

  • Integrate consumer-focused processes across all available channels.
  • Optimize each of those channel experiences.
  • Harness member data to better understand how they interact with their financial institution, including how, when and through which channel they transact to help fuel proactive connection via multiple channels.
  • Consider leaning on industry partners and organizations to provide members with the customized experiences they now expect.

By creating a truly personalized journey, credit unions can better engage with their members, increase value and deepen relationships.

Delve into the key findings and takeaways that your credit union can leverage to effectively market to members and achieve continual growth and success. Download the full 2021 Eye on Payments study now.

In his role as SVP, Chief Marketing Officer, Tom Pierce is responsible for leading and executing PSCU’s marketing and communications strategy. Pierce has successfully led marketing teams for more than 30 years, with the latter half of his career spent in the payments industry. Prior to joining PSCU, Pierce served as Chief Marketing Officer for Cardtronics, a global ATM organization serving the retail and financial services industries, where he directed a global marketing team in the development and execution of strategic marketing and communications initiatives.