Enhance customer engagement by cross selling: Financial Services (US Bank) case study

Author: Seshu Guddanti

Marketing organizations focus on new customer acquisition, cross-selling to existing customers and increasing retention. Companies know a lot more about a customer than they know about a prospect. Inherent knowledge about the customer enables corporations to target the customer with the most compelling offers. In financial services (especially retail banks) companies have lost many sources of revenue due to regulations (Frank-Dodd – Debit Card Fee and Volcker’s rule) and to tough economic conditions. The current economic condition reduced the number of qualified consumers and small-businesses who seek credit. Banks are under increasing pressure to make additional revenue from their existing customer base.

Research shows that an average consumer has 9 financial accounts and 2.2 accounts with a financial institution. Looking at this from a financial institution perspective, every customer has 6.8 accounts with “other” financial institutions. A great opportunity exists to cross-sell and to deepen the relationship with the customer. One of my clients (US Bank) has done a fantastic job of targeting customers based on deep understanding of online and offline behavioral data. Behavior-based segmentation and targeting of customers resulted in a significant response rate increase, compared with traditional marketing.

Every time a customer visits a website and browses specific product pages, they send an implicit message to the company that they’re interested in the product. The customer communicates many messages to the financial institution by their actions in the branch, over the phone and by their bank transactions. The web and transaction data of customer was analyzed and scored in real-time. Customers who met the threshold in the scoring model were matched with other financial products for which they were eligible. The matching was also done in real-time based on the customer profile, eligibility and the value ($) generated by the product to the bank. These leads were fed into various targeting systems such as CRM (inbound/outbound call center), email and web. The results of behavior-based targeting resulted in significant increase in direct sales (conversions or response rate) and referral sales.

Traditional marketing relies heavily on a single message sent through a broadcast mechanism i.e TV, print media and even direct mail. It is difficult, or even impossible, to customize the messaging to individual customers. Using Adobe’s Digital Marketing Suite (Site Catalyst, Insight, T&T) US Bank was able to develop a customized offer (personalized experience) to each customer. Essentially, US Bank was able to listen more effectively to customer needs and also send a unified personalized message across many channels.

Raj Vridhachalam (SVP – Internet & Mobile Delivery, US Bank) and I spoke about US Bank’s success at Adobe Digital Marketing Summit 2012 in Salt Lake City. Adobe has also published a white paper on this subject. Congratulations to US Bank and Raj Vridhachalam on their success!

Key questions to consider include these:

• Do you capture the implicit messages that the customer is sending from the website?
• Do you integrate the online data with offline data?
• Do you target your customers in near-real time across multiple channels with personalized and eligible (preselected) offers?

Let me know if you need more details on this case study.