Banks Must Leverage AI for Superior Sales Engagement
Last year saw an unprecedented surge in interest surrounding artificial intelligence (AI), particularly following the debut of ChatGPT in November 2022. Within six months, Google searches for AI nearly quadrupled, and in just five days of launching, ChatGPT had over a million users, leading to a temporary pause in new signups due to overwhelming demand.
This interest isn't confined to individuals alone; financial institutions, notably North American banks, are also embracing AI-driven innovation. J.P. Morgan Chase leads in AI research, Capital One in AI patents, and Wells Fargo in AI investments. Banks recognize AI's potential to enhance competitiveness in areas like high-frequency trading, payments, fraud detection and marketing.
While new AI applications continue to emerge in banking, focusing on areas where AI can maximize performance today is crucial. Sales engagement is an ideal place for banks to start.
Mastering the art of sales in banking hinges on a few key elements: identifying and understanding a prospect or current customer’s needs and showing how the bank can fulfill those needs with the right products and services.
Oftentimes, that’s easier said than done. Bankers must dig to uncover what a prospect’s financial goals are, what triggered their need and understand the timing of their needs. This involves asking the right combination of questions and in the right sequence to uncover their financial needs and long-term goals. Compounding these challenges, potential customers have more ways to engage than ever, whether it’s visiting the local branch or going online to the bank’s website.
With the careful and appropriate use of AI, banks can begin to effectively address many of the sales engagement challenges. AI assisted customer interactions can help boost sales engagement across all channels, which is crucial in today’s market where competition for deposits remains fierce.
AI Supercharges In-Branch & Online Sales Engagement
Converting prospects into customers is challenging. Most bankers lack sales training, and even if they are skilled at sales, the complexity of product offerings makes it challenging, not to mention the myriad of possible product and service combinations available to customers.
In this environment, AI emerges as a way to enhance sales efforts. For bankers, well designed and compliant AI-powered conversation guides streamline interactions by providing relevant product information and prompting appropriate questions tailored to customer profiles and needs.
Whether bank staff are seasoned or completely new to banking, these AI-driven tools empower bankers to engage in more meaningful conversations, focusing on building rapport and addressing customer needs effectively. By simplifying product selection and ensuring accurate recommendations, AI driven sales engagement enhances in-branch sales performance, fosters customer loyalty and boosts confidence in suggested products and services.
But AI doesn’t just support in-branch sales – critical as more consumers expect digital experiences. Yet, abandonment during the digital onboarding process remains high. In fact, Cornerstone Advisors found that only 14% of financial institutions in the U.S. said that their abandonment rate for digital applications for deposit products was less than 10% while a quarter of the firms said they were experiencing abandonment rates higher than 50%.
Another issue is that consumers are often unsure about which type of account or product is best for them, especially if the bank offers hundreds of products. Moreover, it’s difficult to build relationships online.
Fortunately, in this environment, AI assisted customer engagement can transform high abandonment rates into high conversion rates. Instead of being overwhelmed with choices, AI-driven interactive prompts and tailored recommendations can help guide potential customers, fostering trust and loyalty. The information gathered during these interactions can also streamline the application process, reducing abandonment rates and enhancing the overall customer experience.
AI Also Supports Proactive Outreach
Beyond reducing abandonment rates, interactive tools like online conversation guides are fuel for a bank’s lead generation engine. Even if an online lead cannot be converted immediately through digital account opening, giving prospective customers a way to interact and share their information lays the foundation for more effective follow up outreach from the bank.
Additionally, customers that do convert and apply for a product online generally only apply for one, single product. Oftentimes, this is due to the length of the application. When the prospect or customer applies for only one product online, but AI driven sales engagement has revealed multiple banking needs, the bank is armed with meaningful and targeted reasons for follow-up.
The Impact of AI for Optimal Sales Engagement
By applying AI to sales engagement, banks can tangibly measure and improve performance in several core functions and achieve significant operational efficiencies – from reducing the cost of new customer acquisition and lowering the cost to serve, to mitigating sales risks thanks to better data.
Beyond cutting costs, banks can use AI to tap into new customer segments more quickly and expand into new markets. AI can even boost customer lifetime value by cultivating stronger engagement with existing products and improving the cross-sell of new products.
Instead of guessing what product or service is good for a customer, AI driven sales conversations that rely on up-to-the-minute data based on conversations or interactions with the customer or prospect ensures the most intelligent, relevant product recommendations are presented. Additionally, the data generated from customer interactions and sales-oriented conversations equips bank leadership with timely intel for strategic decision-making.
Several regional and mid-tier banks have already experienced the benefits of AI and improved sales performance across multiple channels. Many banks are seeing higher product adoption and greater growth, with some institutions improving sales productivity by nearly 150%.
The effective use of AI to improve and deepen customer interactions and relationships stands to be a top differentiator for banks in the intensely competitive financial services space. By using the data generated from the latest customer interactions and conversations, whether they take place online or in the branch, banks can meaningfully drive sales and optimize for growth with AI.
Ignite Sales is a leader in retail banking customer and member engagement technology. To learn more on AI in banking, download its free whitepaper here.
About Author:
George Noga, CEO of Ignite Sales