Develop a bank customer acquisition strategy by leveraging data

Banks have the most actionable data on their own customers. However, many aren’t sure how to harness the power of the data they do have while also leveraging third-party data to create a robust and effective bank customer acquisition strategy.

From information on what type of products resonate best with customers to balances associated with products, banks possess a treasure trove of information. Some banks are able to utilize this knowledge to inform their customer acquisition strategy, but too many are not doing so effectively. Add to this the number of banks unaware of how third-party data – for instance, credit triggers – can enhance their internal information and you’ll find too many organizations not taking advantage of the possibilities right in front of them. 

Third-party data makes customer acquisition in banking more effective

A bank’s own data, plus proprietary third-party data, can help banks create a comprehensive and informed picture of consumers and businesses to best understand how those insights pertain to marketing financial products and solutions.

How banks acquire new customers

To create a well-developed targeting and analytics strategy, banks need to partner with data providers or agencies that have access to the information necessary to fill in and strengthen their own internal data. This creates an opportunity for banks to make the best data-driven decisions possible.

Deluxe Data-Driven Marketing, for example, has designed and implemented direct marketing campaigns for thousands of financial institutions. These experiences provide a considerable wealth of understanding of what types of products resonate with which consumers – information that is vital in creating a bank customer acquisition strategy that works.

Data-driven marketing specialists enhance prospect and customer files with third-party information (like credit triggers, mentioned above, and other intent signals), and aggregate appropriate data to build out a longitudinal view of consumers and businesses. Think about all the attributes that make up a consumer or business profile – that information can be intelligently used to build targeting model and analytics solutions that most banks just aren’t able to accomplish on their own. 

Enhance acquisition strategy with missing data about customers

Typically, banks have two main areas of focus when it comes to data-driven marketing: Customer acquisition and cross-selling/growing existing customer relationships. Both are equally important. In large part, banks have limited access to data that is useful in compiling a customer acquisition strategy. If a bank attempts to build an acquisition strategy internally, it could very well be missing key data points.

One of the fundamental missing pieces? Understanding the big picture, including competitor data as well as how programs work across different financial institutions. Compiling this data is a monumental task and one that is not a focus for most financial institutions. That’s why banks partner with third-party data-driven marketing specialists that have collected, licensed and aggregated this information into a single solution that banks can effectively use to enhance their customer acquisition strategy.

Most of this data falls under two broad categories: Trigger data (real-time information on a consumer or business) and profile data. A couple purchasing their first home, a family welcoming a baby, or a business experiencing a change in leadership are all examples of real-time pieces of information banks can use to outreach opportunities and customer journey touchpoints. Profile data – demographics/firmographics, needs and behaviors – is critical information for both consumers and businesses. 

Legal and regulatory limitations to watch for when targeting customers

When it comes to utilizing data analysis as part of a bank customer acquisition strategy, it’s imperative that financial institutions use data elements that are industry compliant. Age and gender, for example, cannot be used as part of a targeting strategy. A bank, and any of its third-party data partners, must all understand the model, regulations and developmental attributes that can be utilized while targeting.

Another practice that must be avoided at all costs is redlining. It is illegal, under the Fair Housing Act, to discriminate against national origin or race in any financial considerations of the home sale process.   

Design an acquisition strategy to measure success

One way to design a direct marketing campaign with measurable results is to utilize a test group and a control group. Take for example a direct mail strategy. If you have two groups of consumers or businesses that are largely the same, but only one is receiving marketing messages from your financial institution, you can compare the account and balance production behind both groups to calculate the cost (and just as importantly, the value) of your marketing strategies.

Creating test and control groups can be especially helpful when you're looking to scale up acquisition efforts in the most cost-effective way possible. 

Test-to-scale is a valuable approach in any marketing campaign, but particularly when your goal is to move prospects along a customer acquisition journey. It's common knowledge among marketers that acquiring new customers costs more (on a cost-per-account basis) than cross-selling to your existing customer base, and measuring results among a smaller test group before scaling to a larger audience can offer critical cost-saving insights early in your campaign.

Leverage what you learn

Don't stop testing and measuring once you've converted a lead to a customer. When the customer acquisition journey ends, the customer retention and cross-selling journeys begin, and ongoing optimization is key for marketers tasked with calculating bank customer acquisition cost vs. lifetime value.   

Banks creating customer acquisition strategies for next year should look for opportunities to incorporate real-time data and be more immediately responsive to both consumer and business behavior. 

Key takeaways 

• Used together, a bank’s own data plus proprietary third-party data can help banks create a comprehensive and informed picture of consumers and businesses (and how those insights pertain to their products and solutions). 
• Understanding the big picture is often a missing piece for many financial institutions, difficult to do without competitor data as well as how programs work across different financial institutions.
• Data elements must follow all industry legal and regulatory guidelines and limitations. 
• Marketing must be measurable. If the impact of marketing data and campaigns can’t be measured, it’s hard to justify the value associated with it.