Alkami Technology, Inc. (Alkami), a cloud-based digital banking solutions provider for financial institutions in the US, has developed and launched an Engagement AI Model via its AI Predictive Modeling solution.
The new model combines artificial intelligence (AI), machine learning (ML), and Alkami’s proprietary Key Lifestyle Indicators (KLIs). The result of this combination empowers financial institutions to identify account holders who demonstrate signs of retention and account growth. It increases their engagement with products, service offerings and digital channels.
Financial institutions can use an attrition model to identify account holders that have a high risk of leaving. As a result, this allows the institution a chance to develop win-back strategies.
“When we looked at the full spectrum of attrition scoring, our research showed that attrition is significantly lower among highly engaged account holders. We developed a model that not only identifies these highly engaged account holders but also layers in Alkami’s KLIs. It describes the type of transaction or behaviour a customer or member engages in. Then, it best predicts which behaviours are likely to drive incremental engagement,” said Mark Leher, director, product management at Alkami.
Engagement equals retention
According to Alkami’s internal research, account holders who score the highest risk for attrition are, on average, 15x more likely to leave a financial institution than account holders who score as highly engaged. Alkami’s Engagement AI Model inverts their attrition model. Therefore, financial institutions can focus their time and budget where it matters most—on retaining and growing their engaged account holders.
Lehr added: “The model assesses the entire universe of a financial institution’s account holders on a daily basis to identify those account holders exhibiting behaviors that have historically led to deeper engagement,” Leher continued. “This allows the financial institution to auto-surface highly relevant campaigns that are more effective at driving growth. Not only does this save on account acquisition costs, but it also empowers the financial institution to engage with those who are more likely to take action on a targeted campaign.”