The Growing Problem Opportunity
This may come as a surprise to many, but a significant portion of the United States population has little to no access to an insured bank. According to the most recent Federal Deposit Insurance Corporation (FDIC) National Survey of Unbanked and Underbanked Households, an estimated seven percent, or nine million U.S. households, are completely unbanked, meaning they have no access to an insured bank. An additional 19.9 percent, or 24.5 million U.S. households, are underbanked, meaning that the household had a checking or savings account, but also obtained financial products and services outside of the banking system at places like currency exchanges or credit unions.
These are some alarming statistics, but change is on the horizon. According to American Banker, “financial providers are increasingly moving their financial inclusion work out of their corporate social responsibility portfolios and into core business areas.” Doing so now provides significant opportunity to help individuals who lack banking options and allows banking institutions the opportunity to increase revenue while doing so.
The article goes on to state, “but as they make this move, they should consider the value of data in making this strategic shift. Success requires more than just cost-cutting. It will be based on the ability to know the right product to offer the right client, at the right time.” So how do banks and other financial institutions figure out the right product to offer the right client, at the right time? The answer is in their data.
Putting Data to Use
Such banks and financial institutions must rely on their data to develop a deeper understanding of what financial products unbanked and underbanked consumers and small businesses need and want. Implementing a customer lifecycle analytics solution helps identify the patterns and cycles of the individuals and businesses to ensure they’re receiving the access they need.
A customer lifecycle analytics solution combines internal and third-party data to ensure that potential clients are given the right offer, which meets their needs, and is affordable to them, the first time around. The key is to identify customers who are in need of banking services and target them with personalized offers that will work for them and their lifestyle. This approach reduces marketing acquisition cost and lowers customer churn by getting the customer into the right product that fits their specific needs.
In addition, as the customer relationship evolves, the key points in a customer lifecycle for a promotion or cross-sell are identified using propensity scoring. This is done by analyzing customer behavioral and usage data, as well as incorporating third party data, thus greatly increasing customer lifetime value.
To learn how an all-inclusive enterprise data intelligence platform can help you know your customers better for growth and a better customer experience, download the data sheet below.
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