Despite mobile devices increasingly defining the future of retail banks and credit unions, many institutions lag in using the insights this platform offers that could improve their marketing and increase customer and member acquisition.
Essential data — such as where else consumers do their banking, how they spend their money and time, and how far they commute daily — is already accessible to financial institutions. However, many are not availing themselves of this information — and certainly not in the same manner that many other industry verticals, such as retailers, routinely do.
Financial institutions need to aggressively tap this intelligence. Those institutions that don’t risk serious competitive handicap by not having such key information as:
- Places: Where do people go?
- Persistency: How frequently do they go where they go?
- Period: How long do they stay there?
- Path: Where do they go from there?
Explore practical strategies and methodologies credit unions can employ to maintain a competitive edge, ensure sustainable growth, and optimize lending programs.
This eBook explains how to grow low-cost core deposits while creating primary financial institution relationships.
Understanding Mobile Data and Its Roots
Location data is used to analyze offline trends from a macro level. Data points used for these aggregated analyses are anonymous and de-identified. In other words, no personal identifiable information (PII) is collected or shared.
There are several ways to collect anonymous location data. One is via software developer kits (SDKs) integrated into mobile apps, which leverage GPS and WiFi signals to collect and aggregate anonymous location data points, provided that the mobile users opted-in to the data collection.
If you’re curious about whether you are being monitored, anonymously, check “Location Services” on your smartphone. This will show how and in what circumstances you have opted in, both overall and app by app.
Read More: The Power of Location-Based Offers
5 Ways Mobile Location Data Can Improve Marketing
Bank and credit union marketers can bolster their promotional efforts in a number of ways by using this technology.
1. Consumer profile enhancement. Mobile location data can help financial institutions better understand consumer habits, such as where they shop and where they work. Location data won’t be able to tell you what kind of accounts people have at other banks. However, place and period data provide insights into which institutions your consumer base may have or consider doing business with on a macro level.
“Mobile location data can unlock insights into how consumers spend their time and money.”
— Valentina Marastoni-Bieser, Cuebiq
By combining place and period data, banks can estimate how far their consumers work from their branch locations. Aggregating work location data across a base of consumers can tell a financial marketer if a particular firm employs a disproportionately high percentage of an institution’s customers or members. This can help the institution reassign primary relationship status to a branch closer to their work location so they can better serve them.
Additionally, mobile location data can unlock insights into how consumers spend their time and money. Understanding offline behavior from location signals to understanding shopping patterns — including retail, food and travel — provides product insights and increases future share of wallet opportunity.
2. Segmentation. Behaviors observed via mobile location data concerning shopping, banking, and commuting can be used to create consumer segments. This data can be used to dig more deeply into behavioral trends, revealing frequency patterns in how consumers shop, whether it be at an upscale boutique or at a discount chain, and how they bank, such as at specific competitor.
For any segment created, mobile location data can use time-of-day as a factor to distinguish subsets within customer segments. For example, a bank can see segments of consumers that visit branches predominantly in the afternoon, or those that typically go on a particular day. From there, an institution can send certain marketing offers out, like a special savings account for those exhibiting certain behaviors.
- Gen Z Means More Digital, Mobile & Social for Financial Marketers
- 6 Strategic Trends Reshaping the Future of Email Marketing in Banking
3. Campaign management. In terms of overall marketing efforts, mobile location data can assist in launching new campaigns. For example, an institution promoting a co-branded card can help create a targeted segment for the offer using location data. Alternatively, such data can be leveraged with potential retail partners for card utilization offers, providing the evidence a retailer needs to be convinced that your institution is the right partner for a certain promotion.
4. Competitive intelligence. Mobile location data can help institutions compare their own branch activity to the branches of competitors, and their performance as a whole. While it does not provide a full picture of consumer banking habits, it can provide strong indications to which ones they do business with.
For example, a Bank of America branch can see the percentage of its customers that have visited a nearby JPMorgan Chase branch in a certain month, and how this compares to other months. It can also show whether a bank is as successful at driving branch visits, compared to its competitors, as it may believe.
5. Branch performance trends. A single branch can use mobile location data to see how long consumers stay at the branch. Long dwell time at individual branches can be a sign of a good interactions-to-transactions ratio … or it may be a sign of long wait times and service issues.
If consumers experience, or think that there will be, long wait times in the branch, they may not want to visit. As a result, institutions can consider staffing up for busy periods or offer additional automated lanes for simple transactions. Alternatively, this may suggest stepping up development of some digital alternative.
If harnessed and properly deployed, mobile location data is a powerful tool that can help financial institutions better connect with and engage with consumers. Financial marketers cannot afford to pass this opportunity up. Choosing to ignore the benefits of location data leaves an opening for more-aggressive competition to gain market share and foster greater brand loyalty with consumers.