ROI is often difficult to assess in the data heavy world of financial services marketing, yet it remains the holy grail for most marketing teams. Smart marketers can leverage data analytics to accurately forecast, track, and calculate program ROI for metrics they can trust.
Financial institutions today are investing significant resources in acquiring, storing, and processing customer data. But even in today’s world of Big Data solutions and dashboard technologies, it’s often difficult to accurately track costs and learn exactly how much the program resulted in new business – both of which are essential to calculating ROI.
In this type of scenario, ROI becomes a matter of guesswork, and guesswork is simply not acceptable in the world of FI marketing, particularly when customers are won and lost in the blink of an eye and profit margins are razor thin. Today’s high customer acquisition costs demand that marketing professionals be able to calculate ROI quickly and accurately. So how can this be achieved when there is so little time, and so much data to work with?
It is not as difficult as it may appear. The first step is to adopt a complete, end-to-end solution approach that is iterative and self-learning. Through data analytics, benchmarking, machine learning, and data integration, new campaigns track dollars accurately and build upon the success of previous ones, so calculating costs and ROI becomes a more precise science. This allows a marketing team to evaluate the impact and ROI of every campaign they run.
Here are a few examples of how organizations using this kind of approach have enjoyed outstanding gains in ROI that are both definable and reliable:
- A credit union wanted to increase debit card usage in their customer base. Using data analytics, they developed a program that targeted a segment of customers with low POS usage of their cards. The promotion, which involved receiving a gift card at major retail venues for increased debit card transactions, automatically identified the target customers, and measured outcomes in real-time. As a result, card usage rose dramatically, and the credit union received a 433% ROI on its investment.
- A bank sought ways to reduce their customer service costs while maintaining high standards of service and retention. The bank identified the adoption of digital banking as the answer and used an end-to-end financial technology solution to identify and market to customers that did not routinely make their deposits electronically. An aggressive cash-back incentive was offered, and the program was a success. Monthly customer service costs were reduced dramatically, resulting in an ROI that approached 90% over an 18-month period.
- A southern credit union wanted to improve revenue generated by new and under-performing credit card holders. Using data analytics, the credit union was able to develop and execute several incentive programs to drive credit card usage to this specific segment of customers. The results were dramatic. Cardholders increased spending from $106 and $131 per month to $201 and $961, respectively. Equally important, the credit union experienced a one-year return-on-investment of 233%.
How did they accomplish such positive results? The automated, end-to-end approach used by these and other successful financial institutions can help marketers quickly and easily understand the following:
- How much did an actual program cost?
- What were the outcomes of the program?
- What was the revenue impact of the program?
- What was the exact ROI of the program?
Data analytics and other automated tools take the guesswork out of ROI, making it possible for marketers to accurately estimate which programs will be the most profitable. This makes it easier for financial institutions to run a streamlined suite of marketing programs and promotions that provide the maximum benefit in terms of revenue and customer retention for the smallest investment.
Saylent provides a suite of end-to-end solutions designed to help financial institutions identify, develop, execute, and analyze marketing and sales programs for the financial industry. Visit our Case Studies section for more examples of how Saylent has helped customers like your organization achieve maximum ROI.