In the Mercator Advisory Group research report titled The Six Million Dollar Customer: Using Technology to Build a Profitable Customer Base, Ben Jackson identified why banks need to proactively grow the assets of account holders and he provided a recipe financial institutions can follow to achieve that goal. A critical aspect of that recipe is to build consumer engagement models that help account holders overcome a common flaw in human behavior, which is that people fail to take actions they fully acknowledge are critical to their financial lives. In large part, solving this problem will require a new approach in the ways that financial institutions engage the account holder—discovering the right balance between consumer privacy, customer personalization, and personal automation tools that—once established and left unchanged—will achieve the account holder’s identified financial goals. Of course, not all customers will overcome their prewired behavioral proclivities, but the goal of the bank is to engage all account holders in order to deliver products and approaches that will drive personal financial achievement to the widest possible audience. In the new world of mobile engagement, remaining passive will enable smarter financial institutions to steal your customers at each life event in which your institution fails to provide financial support.

The report, A Digital Future Compels the Use of Technology to Automate Achieving Financial Goals, reinforces the findings presented in The Six Million Dollar Customer report utilizing new consumer data. Analysis of this data suggests that implementing the “recipes” identified in the report will help reverse the extremely low trust ratings that consumers give to their financial institutions. Although we recognize that financial institutions are surrounded by regulatory constructs that drive risk-averse behavior, this report outlines a technological approach for deploying solutions that will proactively help account holders identify and achieve their financial goals. The approach is similar to innovative new healthcare models.

The prevailing concept in current healthcare delivery is “patient engagement,” a top objective for all stakeholders in the business of providing healthcare and paying for healthcare. We live in a time when technology and communications have enabled never before seen capabilities in delivering focused diagnosis and treatment plans. Patient monitoring is being accomplished through personal devices and wearable technology. Public health government agencies, healthcare providers, and healthcare payers (insurers) that adopt the patient engagement concept benefit from increased patient cooperation. However, the insight these organizations gain and their resulting recommendations to patients mean next to nothing unless patients accept and follow the individualized plans designed to improve their health. Some medical conditions are self-inflicted, and some are the result of the accidents of life, but finding ways to effectively keep the patient on track toward improved health is the objective.

In a similar way, government agencies such as the U.S. Consumer Financial Protection Bureau encourage financial institutions and financial service providers to take a more collaborative role in helping their customers to adhere to course to achieve their financial goals.

Critical to improving the banking customer’s personal financial management is the right engagement model associated with the product being offered or recommendation being made. The report, mentioned previously, provides an engagement model with features designed to protect the institution and the consumer from consumer privacy concerns while deepening the relationship at the pace the customer finds comfortable and including multiple opportunities for the customer to opt out.

Just as people often establish a longstanding relationship with a family doctor (now called a primary care physician), a bank or credit union can serve as a consumer’s primary financial institution and initial point of contact for attaining personal financial goals. The analogy can be expanded to the more active role that healthcare providers are adopting in managing patient health and wellness. Banks will have increased access to third-party information about segments of the customer base and individual information to make proactive suggestions and develop products that automate attainment of common goals.

The idea that a bank can cost effectively assist all account holders to improve their financial lives may viewed with some skepticism by some readers, but as our colleague Ben Jackson paraphrased in the Six Million Dollar Customer report “Ladies and gentlemen, we can build them. We have the technology.” Mercator Advisory Group primary research indicates that consumers in the United States expect banks to help them plan their financial future. We suggest that financial institutions that fail to engage consumers around their financial needs will be further marginalized by mobile suppliers and alternative financial services companies that are engaging smartphone owners across all aspects of life, even when asleep. Your organization’s own management team has experienced how smartphones have changed their lives; now they need to understand that the institution doesn’t embrace the technologies that underpin the mobile experience and utilize the data it generates, it will become irrelevant to its customers.