The FINANCIAL — The latest survey by database marketing and consumer insight firm KDB found the banking sector to be one of the best at using customer data to inform their marketing, according to financial directors and managers.
However, with only 50% of financial directors and managers seeing strong use of data-driven marketing in the sector, there is clearly room for improvement.
Across all industries, when asked if most firms in their sector were able to access and analyse customer data and then use this intelligence in their marketing, only 43% of the 1,000 finance directors and senior financial managers surveyed said yes.
Banking made it into the top three behind travel and transport (65%) and hospitality and catering (72%). In contrast, use of customer data to inform marketing was seen as weak in retail (38%), media and marketing (36%), utilities and telecoms (36%), and healthcare (29%).
"The recession along with high profile cases of data security breaches in the sector have made customers less confident in banks, leading to lower levels of customer loyalty. Furthermore, increased competition is threatening retention, and the commoditisation of products makes it harder for banks to stand out from the crowd," KDB survey says.
Matt Boot, chief analyst at KDB, notes: “Banks are naturally rich in customer data, so they have little excuse when it comes to customer insight. Investment in CRM systems over the last decade has clearly started to pay off, but there is undoubtedly more to be done. Those with a thorough understanding of their customers and insight into how, when and what to offer them, will be in the best position to differentiate themselves and capture new customers.
“Using customer data to inform your marketing strategy is vital in the current economic environment. Smart companies use such insight both to get more out of existing customers and to make sure they are approaching the right potential customers in a way that will work.
“Customer data is a tool that is right there at the disposal of most companies and it helps them to make sure they are focusing on the sorts of customers that will help keep up their margins and cashflow in the face of the recession.
“The last thing marketers want to be doing at the moment is wasting their budgets on less profitable and loyal consumers. The effective use of customer insight helps them identify the right targets for their marketing.”
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