Financial Services: Connecting the Dots with Customer Analytics


This week, SAS hosted the Financial Services Executive Summit at our headquarters in Cary, NC. Part of the content was a fascinating panel discussion moderated by Lori Bieda, the SAS Executive Lead for Customer Intelligence. In the picture below, Lori is on the left and she was joined on the panel (left to right) by Susan Faulkner, Deposit and Card Products Executive from Bank of America, Eric Williams, Executive Vice President and CIO at Catalina Marketing, and Mark Gorman, CEO and Founder of Gorman Group Insurance Consultancy. The discussion provided a strategic view of how customers are changing, and ways the financial services industry is changing (and needs to change) as a result.

Some of the highlights from the discussion included hearing how Bank of America has adopted customer segment P & Ls as an important way to drive customer centricity. Eric shared that his entire company (Catalina) is based on customer relationships, so customer centricity is innate, but that the real change that will take us into the future will be to customize the media on which the customer wants to be communicated to. Mark added the insurance industry perspective, noting that the historical view of a “customer” was the agent, and that marketing to the consumer directly is a relatively new thing. He pointed out that the compound annual growth rate of brand expenditures in insurance has been over 14% over the last several years, and in the case of one large insurer the growth rate was actually 33%. It should be no surprise to hear that customer analytics is a very hot topic in financial services. Susan noted that she’s spoken more about customer analytics in the past year than she has in the previous 20 or so years combined. What I thought was really cool was to hear Eric say that both responsiveness and non-responsiveness was being analyzed by Catalina to help determine the preferred channel of the customer, which of course, becomes an important data point in getting to the 360° view of the customer. To me that’s a great example of gaining customer insights based on behaviors, thereby enabling Catalina to anticipate the customer need rather than overtly asking the customer, “Do you use your smartphone that way? No – okay, do you want emails or hard copy offers?” And so on. Taking the time from a frazzled customer with those questions may be what shuts them out and then you’d have lost them.

On the topic of customer behavior, Mark offered the view that segmentation in insurance has traditionally been based primarily on demographics, but that more meaningful approaches have taken root recently by including behavioral factors such as risk profiles. He also added that real-time responsiveness can be a big opportunity for insurers since 95 – 97% of the early application process for many new customers is not touched by a human being, which of course means an automated online or telephone system. I agree with his point, but even if the process were a live interaction with an agent, getting a prompt to make an offer based on knowledge of the customer makes the process more meaningful for the customer. In addition to Mark’s example, real-time responsiveness was a recurring theme in this discussion, which of course, is the central business proposition for Catalina Marketing. Susan also made the point that connecting the dots to be relevant for the customer generates value when it can be done at point of decision.

At one point, Susan asked a good rhetorical question to everyone in the auditorium, “How many of us incent our front-line people to be accurate in gathering information? How do we capture behavior information, pair it with provided details and then accurately segment?” It served to remind us of the idea that no matter how sophisticated your models and processes, you cannot lose sight of the need to have good data. Data quality is square one in any customer analytics application because you rely on it to make accurate predictions and to be relevant with your customers.

Lori cited recent research conducted by The Economist Intelligence Unit on behalf of SAS around the topic of customer value. She called out the idea that consumer empowerment and the interconnected social media-driven ways that have changed how people communicate compels companies to rethink how they approach customer valuation. In particular, customer valuation now has to take the value of purchases as just one component. The other factor is accounting for people's varying degrees of influence over other potential purchasers in your target market. Think in terms of the example I gave in a recent post where I invited you to type “breaks guitars” in your browser line and read about an unhappy airline passenger’s response to an unfortunate baggage handling issue.

The discussion also touched on the ways that the recent financial industry meltdown caused a serious loss of trust on the part of individuals for financial services organizations. Mark commented how it was somewhat surprising that the insurance industry did not experience quite the same trust crisis that hit the banking industry. Susan stated that for Bank of America, that difficult reality means that interactions with customers are more critical and there is simply no alternative to having to earn that trust back. Their interpretation of that business imperative is to drive a culture that will do the right thing for the customer every time and that you simply can’t put a marketing campaign together around “trust me” without also showing a sincere effort to earn the trust in your actions.

For me, the panel’s discussion validated many of the points that are near and dear to all marketers:

  • It’s important that your actions and your words throughout the organization are consistent and mutually supportive. This is a well-established tenet of good branding, and it also turns out to be good marketing in general and sound business strategy.
  • You need to listen to the customer and do what’s right for them every time. It’s the best way to build a relationship that’s valuable, and then your customer can become an advocate that reinforces your marketing efforts.
  • As your marketing gets more sophisticated and customer analytics becomes a key enabler to your marketing success, it becomes even more critical to ensure that your data is accurate and meaningful.

We made a video recording of the session, which will shortly be available at the event microsite: We also will transcript it to develop a conclusions paper, and I will add a link in a comment to this post when the paper become available. In the meantime, please share your thoughts, or share this post with your colleagues. I appreciate your interest and support.


About Author

John Balla

Principal Marketing Strategist

Hi, I'm John Balla - a Digital Marketing Principal here at SAS focused on Content Strategy. I co-founded the SAS Customer Intelligence blog and served as Editor for five years. I like to find and share content and experiences that open doors, answer questions and maybe even challenge assumptions so better questions can be asked. Outside of work I stay busy with my wife and I keeping up with my 2 awesome college-age kids, volunteering for the Boy Scouts, keeping my garden green, striving for green living, expressing myself with puns, and making my own café con leche every morning. I’ve lived and worked on 3 contents and can communicate fluently in Spanish, Portuguese, Hungarian and passable English. Prior to SAS, my experience in marketing ranges from Fortune 100 companies to co-founding two start ups. I studied economics at the University of Illinois at Urbana-Champaign and got an MBA from Georgetown. Follow me on Twitter. Connect with me on LinkedIn.

Leave A Reply

Back to Top