The following is a guest editorial courtesy of capital markets industry software solutions provider Devexperts.
Brokers are sitting on piles of valuable client data…and not using it. Either they don’t realise they have the data, or they know it’s there, and don’t realise its potential. On top of this, they simply don’t have the right tools to take the data and use it effectively.
What kind of data are we talking about here?
Inside trading platforms, brokers can easily capture (and often are capturing) data like trading behaviours, client profitability, order-flow characteristics, risk profiles, frequency and timing of trades, preferred instruments, and responses to market events.
This data can be used to improve targeting accuracy, optimize risk management strategies, and tailor offerings to build solid client relationships.
Brokers are constantly grinding for retention and value from their acquisition spend, asking ‘how can we engage with our clients better’, ‘how can we keep them on the platform’; meanwhile they have access to data that tells them exactly what their clients want, and how they want it.
“Few brokers know that valuable data is often already collected inside their trading systems. They know they’re sitting on data, but they don’t realize its potential,’’ says Ivan Kunyankin, Data Scientist Team Lead at Devexperts.
Smarter client profiling and behavior analysis
A lot of brokers are still heavily reliant on basic segmentation, sorting clients into broad static groups, usually just based on demographics. When data is pulled from the trading platform and used effectively, brokers can build detailed client profiles that reflect actual behaviors.
Additionally, these profiles can be dynamic and use implicit patterns. For example, you can segment users by their risk tolerance, even when they didn’t fill out any questionnaire before, using solely their trading activity.
Instead of guessing, brokers can know exactly who their clients are, what’s motivating their decisions, and how to adapt their services and experience to keep them from wondering if the grass is greener somewhere else.
“You need to have additional tools or know-how for client profiling. You need to understand your clients and their trading patterns—how and when they are trading. There are so many parameters that we can look at. Some of them are client-related, and some are more trading-related,” said Elina Pedersen, Co-Founder and CRO of Your Bourse, on a recent episode of the Dealers Connect podcast.
End of ‘hit send and hope for the best’ marketing
Grand marketing efforts can sadly (for ROI) be like shooting into the ether and hoping for the best. This is true when targeting broader audiences, but becomes even more relevant when trying to ‘personalize’ campaigns. This is a buzzword we see everywhere – personalized this, personalized that; but what does that actually mean? How are brokers actually personalizing the experience on an individual level? You need to be extracting and applying insights from data for that.
All sounds good, but how…(lack of tools)
As we said earlier, sometimes it’s the case that the brokers realise, right, we’ve got all this data, and now what? ‘We’ve found the goldmine, where’s the shovel hiding’. The reality of course, is that we are not there yet in terms of available solutions on the market. Overall, there’s a lack of solutions that allow brokers to effectively extract and leverage the data.
Devexa – the shovel
Devexperts’ AI trading assistant is a customer care and engagement tool. Yes, more buzzwords, but Devexa is relevant here because of her ability to make personalised comms meaningful, in the true sense of the word (not just by broad demographic profiling).
From inside the trading platform, she feeds on client behaviors, trading patterns, and preferences, and uses them to shape the individual experience.
Devexa can send personalised notifications and trading alerts (in the platform or directly to the client’s Whatsapp, Discord, etc.) that are aligned with their portfolios and behaviors. Traders can communicate directly with each other using the community feature.
Essentially she keeps them active and trading with insights that are helpful and not just ‘one notification fits all’ spam-style alerts.
Same thing with marketing campaigns; brokers can go into Devexa’s admin, and create user groups based on granular behaviours and preferences, and send out campaigns, educational content – whatever they want, to use their data effectively.
“It seems crazy to say that brokers addressing their unused data now, will be gaining an early advantage, given the data-dominated era we are in. But, the industry is quite late on this. Awareness is the first step, and then naturally action has to follow. Devexa is a way to tick a lot of boxes. Brokers are probably also looking into AI right now, and she leverages data using AI – on top of customer care and other functions,’, said Togay Artemiz, Devexa Product Manager.
Ultimately, brokers who don’t realise the data they are capturing, need to take a look under the hood. Then they need to check how they are capturing the data, making sure they are collecting the most meaningful information. Finally, they need to look at how they can turn that data into actionable insights, i.e. find the right tool.
Brokers are scrambling for ways to improve engagement, retention, and acquisition ROI (makes sense), while ignoring the large piles of data they are sitting on, that have the potential to deliver exactly what they need. Time to dust off the data.
Connect with Devexperts
To follow more of Devexperts’ commentary on current trends, connect with us on LinkedIn. If you have any specific questions about multi-asset platforms, feel free to reach out to the team.
