Pub. 11 2021-2022 Issue 3

coloradobankers.org 10 By Neal Reynolds, President, BankMarketingCenter.com A s a community bank, nothing is more important to your success than understanding your customers and delivering value. What’s different today? There was a time when understanding your customer’s needs and overall financial behavior was, well, easy. Unfortunately, that’s simply not the case anymore. For a long time, community bankers achieved this customer insight by interaction. If you’re old enough to be reading this and grew up in a small town, I’m sure you remember. I do because that’s how I grew up. You’ve seen “It’s a Wonderful Life,” right? Remember when Potter questions the loan that George has approved for Ernie, the cab driver? “I can vouch for his character,” George tells Potter. Having grown up in a small town, not terribly unlike Bedford Falls, I had a very similar experience myself, many of them, in fact. When I was ready for my first car loan at age 18, Mr. Jepson, the kind gentleman who ran our local community bank, didn’t need me to fill out a loan application, survive a host of credit checks, or have a bunch of agencies confirm that I wasn’t a criminal. He knew my parents, my grandparents, and all my family. He knew I had a steady job at the IGA grocery store, was headed off to college and was in church on Sundays and Wednesday nights; he knew all about me. Those days are gone. Vouching for someone’s character just isn’t an option anymore. With online and mobile options, customers no longer walk into their local branch and do all their banking there. The insights that bankers need, that they used to get through interaction, are tough to get. Instead of that personal cooperation to gain those insights and act upon them, bankers now rely on Data, Artificial Intelligence (AI) and Machine Learning (ML) technologies. This past January, Business Insider talked about the tremendous impact that AI can have on a bank’s customer experience. “Banks can use AI to transform the customer experience by enabling frictionless, 24/7 customer service interactions.” The Insider goes on to say that banks can, and are, “using AI to deepen customer relationships, and provide personalized insights and recommendations.” Thus, artificial intelligence is now gathering and analyzing the data that a banker’s “real” intelligence once gathered and analyzed in order to know the customer. Today, What a Small Town Taught Me About Artificial Intelligence