Interesting article in the FT about how banks are starting to copy Amazon’s data mining capabilities to help cross sell research on listed companies.
Banks are analysing how clients read and use research documents in order to help them sell additional ‘targeted products’, based on what they and their peer groups have previously bought.
The article quotes Neil Shah, director at Edison Investment Research, who talks about how banks are starting to adopt technology that:
Allows equity research teams to have as close a relationship to their asset management customers as Amazon does to its customers….
There are two ways in which equity research producers are trying to understand their clients’ needs better: by learning what research they value, and by making their research more accessible.
It’s also been a challenge for many banks to integrate research into trading in such a way that they can metricate the value of their research, through subsequent client execution on their platform.
Full FT Article here
Of course, that’s the essence of a Single Dealer Platform, creating a ‘personalised’ platform for users based on what they need.
Make it easier for clients to manage their risk, and intuitively navigate through the bank’s vast warehouse of capabilities and services in such a way that the platform ‘learns’ and seamlessly ‘serves up relevant’ contextual insight and information around what a user is focusing on – so, if you are looking at FX pricing, then serve up relevant FX research, charts, and depending on users sophistication perhaps highlight correlations that the client wasn’t aware of, and maybe show peer group ‘flows’ in that currency pair.
Building such a direct relationship with clients, enables banks to data mine client MIS usage of the SDP. In this way, they can analyse client buying preferences (read here ‘trading preferences’), and can ‘learn’ (or rather their pricing engines can learn), client trading preferences and currency pair sensitivities.
Some banks are already doing this, but more need to get smarter about how they service their clients using their Single Dealer Platforms, if they want to retain and grow their client relationships.