Really Learning Customer Behaviors with Your MCIF.

• Author: Coffey, John J.
• Position: Marketing customer information file - Brief Article

Your customers have several channels by which they can access your bank's services--unlike when they deal with retail service providers in other industries. They can use the branch, an ATM, call over the phone or access your services through the Internet. Add in third-party services like processing centers, automated loan machines and even automobile dealers, and customers can gain access to loans 24-hours a day, 7-days a week.

The data contained in your MCIF allows you to review which channels your customers use and further analyze how your bank can better allocate product distribution resources. For example, you might determine that loan officers can effectively work out of a centralized call center, rather than maintaining a physical presence at each branch. And loan machines and self-service kiosks can be strategically placed where the demand will warrant the investment.

Why append demographic data?

Banks are rich in data compared to many other industries-an abundance of financial data is available at your fingertips about customers. However, banks fail to consistently ask for the personal information that would best help them understand their customers. Instead, they rely on vendors who sell them demographic data that can be attached or appended in your MCIF at the household level.

Demographic data can include personal attributes such as age, income, marital status, presence of children and occupation. It can also include product purchase behavior such as home ownership (along with home value and length of residence), type of credit card and type of vehicle owned. In addition, this data can be "geo-coded" with attributes such as state, county, census tract and block codes.

Demographic data, such as age and income, can be combined to form "life stage segments. Combining this data can help you understand purchasing behavior for specific customer segments--for instance, people who are age 46 to 55 and whose income is between $75,000 and $99,000. When combined with profitability, these life stage segments can illustrate the most profitable age and income combinations for you to direct specific marketing efforts.

What kinds of transaction data are useful for enhanced...