For bank marketers, transaction data can lead to increased revenue

For banks, sometimes the most insightful marketing data can come from the spending habits of their customers.

Consider Sophie, a small business owner who uses her personal checking account to run a photography business. That may work well enough for her now, but she may benefit more from small business services as her company grows. But, Sophie is busy and may not inquire about these services directly.

How can your marketing team identify Sophie as someone who could use your small business services? The answer is to look at what she’s not telling you. Her spending likely includes online advertising expenses and recurring transactions for other business services, which tell you plain and simple that she needs more than a consumer checking account.

There are millions of account holders like Sophie who would benefit from personalized, relevant product offers before they have to ask for them.

Diligent banks have proactively reached out to their account holders and encouraged them to add products and services. But for decades, these efforts have been imprecise and have felt more like turning on the proverbial fire hose: spraying a product or service to many customers—regardless of their personal needs—and waiting for results.

Financial institutions of any size can solve these challenges by leveraging transaction data, using a single platform to yield insights and launch personalized communications.

By delivering targeted and relevant engagements and offers, profits and account holder longevity can increase exponentially. The key is to identify what account holders want before they initiate outreach to you—or to a competitor.

Where artificial intelligence and machine learning fit in:

Artificial intelligence (AI) and machine learning (ML) can efficiently mine invaluable insights from a variety of account holder data sources, without necessitating additional headcount. Partnering with the right fintech vendor that understands how to cleanse and categorize data and how to make it actionable within your ecosystem can not only keep your data safe, but enable channels such as digital banking to transition to a profit center.

Behaviors within digital banking—including spending patterns, login behavior and adopted products—all yield critical signals. AI tools can monitor these signals and trigger message delivery, tailored to the right audience based on your financial institution’s campaign strategy.

Data and marketing solutions use cases:

Financial institutions that prioritize the value of data look for vital signs within that data to drive decisions for targeting around product promotion, messaging relevance, competitive engagement, and financial wellness.

Onboarding and cross-selling:

For the account holder, the first interactions—opening accounts, taking out loans, applying for and using credit cards—must be fast, easy, welcoming and seam[1]less. This is an opportunity to understand who the account holder is now and what they may need in the future. Prescheduling a digital onboarding journey that includes other relevant products, messages containing advice, to-dos and financial tips creates efficiencies as well as keeps the institution top of mind for each account holder.

Increasing lending products: Consider those who have significant expenses with recency and frequency at home improvement stores, such as Lowe’s, Home Depot, a local lumber yard, a paint store or a carpet store. This spending indicates that they are likely making investments in their home. They may benefit from messaging that suggests a home equity line of credit or other loan product to finance these home improvement expenses.

Boosting interchange revenue: Subscription account holders with recurring expenses on debit cards or credit cards are also worth examining. The more account holders associate their debit or credit card to recurring expenses, like car rides via Uber, subscriptions such as Hulu or utility and mobile phone payments, the more they will be committed to that card and to your institution, leading to an increase in interchange revenue. Another opportunity lies with identifying those account holders without these types of recurring expenses and encouraging usage for subscription charges.

Understanding competitive intelligence:

Financial institutions can spot account holders who are making loan payments to a competitor or transfer[1]ring funds from their institution to an investment firm. No matter the engagement, these customers have money that can easily stay within your institution, and using competitive intelligence to market to them can win back or capture a higher percentage of your account holder’s shareof-wallet.

Supporting customers’ financial health:

You can also spot signs of financial distress. If a customer begins collecting unemployment, for example, reaching out to them—with empathy— and offering assistance and other financial well[1]ness tools could benefit both the individual and the financial institution.

Acting on this intelligence can be very efficient with self-serve audience list builders using insights and integration with campaign delivery tools. The insights provide the right knowledge to build your tailored content and messaging, so it resonates with the account holder.

When content is delivered, banks can automatically track return on investment, allowing the financial institution to quickly adapt to campaign engagement. When it comes to proving marketing’s worth, today’s technology can make it seamless to drive those high-performing campaigns faster, with a holistic view of results. Companies like Alkami can automatically produce metrics that identify the accounts opened, the channels used and the value of those accounts.

Customers are telling banks exactly what they need—banks just need to know where to look. Savvy banks understand that account holders yield a wealth of monetizable insights. Banks need to leverage that data to help grow share-of-wallet, turn digital banking into a profit center and drive loyalty simultaneously.

Joan Clark is director of product management at Alkami