One theme has consistently rung true across many financial institutions (FIs) over the last few years: “We need to leverage our customer data.” Institutions of all sizes have spent considerable time and investment in data lakes, warehouses, and MCIFs (Marketing Customer Information File). At Segmint, we love to see FIs take these steps.
Organizing customer data is crucial for all organizations. It is so important to get that rich data under control. This structuring of data, which often sits in numerous silos, can be cumbersome and tedious, and often becomes a continual work in progress. Our experience working with hundreds of clients tells us that we can almost set our watches by the comment that follows an FI getting their data project dialed in: “Now what?
The next step, for most FIs, is to start using their organized data in their MCIF (Marketing Customer Information File) to send “targeted” messaging to their customers. This is typically a direct mail piece, an email, or even an outbound call. Using data to reach customers with relevant messaging is critical in this day and age. Frequently the returns aren’t what the institution expects… if they are even able to track results at all..
Where is the disconnect? Often, its lack of actionable insight in the data stack. Organized data is just a starting point. Having data aggregated in a “data lake” or warehouse is a great start, but if teams are not able to glean specific insight from the customer data, they are limited to how it can be leveraged Many FIs believe that knowing that someone has a checking account but not a mortgage is insight. At Segmint, we believe that is the bare minimum, or the baseline. We begin by cleansing and organizing the data, and then apply predictive insight and contextualization. It is about getting to that next level of relevancy to grow customer relationships.
The data every institution is sitting on can be used more powerfully and with more efficiency. Every bank and credit union needs to unlock the power in their transaction data to truly understand what customers are doing and what is coming next in their lives. There is a difference between data and insights, and both are needed. Data helps understand the basics, what products customers have and what their balances look like, for example. Insights, using predictive analytics and contextualization, takes that to the next level. It provides the ability to understand behaviors, preferences, habits, risks, life events, and much more. That next level is what separates industry leaders from every other financial institution. For example, a data warehouse may identify someone in the market for a mortgage. Insight from transactional data would reveal that they are a long-term renter who is planning a wedding and has a dog. With that level of insight, messaging can be delivered that is timely, relevant, and in context.
Accessing customer data is an important first step but trying to use that data without insight is difficult – and that may just be the gap that is keeping your FI from getting to the next level. Close the gap and take the steps I’ve outlined here to dive into your customers activities, patterns, and lifestyles. Data can provide you insights about your customer that you typically would learn from a face to face conversation, giving you a powerful way to delight your customers.
