The Internet of Things in Banking

The Internet of Things (IoT) connects objects other than a computer or a smartphone to the internet, allowing all sorts of devices in stores, town centers, kiosks and stations to have internet compatibility. IoT technology is important for banks and credit unions because it provides a new area to expand their market reach and gather data about their customers.

Importantly, IoT technology elevates the amount of information about customers both during and as a result of the transactions they conduct. Their purchasing behavior becomes documented in a new way, and that information can help retailers and financial institutions alike to provide a more valuable and personalized customer experience.

Wearable Technology

Apparel-based technology, such as wristbands and watches, are a major step in the direction of IoT technology and a major opportunity for early adopters of this technology. These devices allow customers to interact with the kiosks they’re purchasing from in a streamlined way. They can pull up deals, see reward points they might have, and the kiosks can utilize their devices to help personalize their experience.

Along with all of these customer benefits, retailers and financial institutions can gather information easily about their purchasing decisions, categorize their buying behavior, and think about ways to enhance their value as a customer in the future. These devices will see an explosion of growth and adoption over the coming years, and financial institutions who invest now will reap major rewards in the form of customer intimacy.

Data, data, data

By having customer information on-hand in the form of wearable devices, and being able to sense the location of customers, wearable devices present a unique opportunity to quickly process an individual’s likely scenario (where they are shopping), understand their recent purchase history, and combine this information with other data, such as their checking account balance or current promotions on products they’re likely to buy.

Simply put, these features have the capability to revolutionize retail. Consider the following purchasing scenario:

  • Proximity. A customer is near a purchasing location, and their wearable device is processing their purchase history there, identifying any potential opportunities that the customer could benefit from.
  • Shopping. A wearable device can prompt a customer on their last purchase, show discounts that can be automatically applied, remind them of other products they’ve purchased in the past and direct them to where they can find products.
  • Purchase. Customer data shows and utilize any rewards or discounts they can take advantage of. Their purchase can happen using voice-enabled technology, and their information is already stored for an easy transaction. The security measures on both the machine and the wearable device help ensure a secure purchase, and afterwards, their data is automatically stored and categorized.
  • Back-end. Customer data is automatically stored and compiled with other customer data from the day, showing macro-trends in shopping. Financial institutions can compile customers’ personalized data into hyper-focused profiles that show what type of shopper the customer is, along with combining their purchase data into larger data sets across their entire customer base.

These steps and features of wearable devices provide a new way to permanently change retail and shopping, taking the already existing principles of marketing, personalization and customer data, and streamlining the capture and utilization of these principles into an exceptional shopping and data-processing scenario.

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