Contact Data Crunching for Credit Unions: Guest Opinion
The use of contact data is changing for credit unions. Today, financial institutions are using contact data to ensure that communications reach members and prospects, but, perhaps more importantly, those institutions are also leveraging contact information to better understand their members through database consolidation and a single member view.
According to a recent Experian QAS study, 90% of financial institutions stated they will eventually attempt a single member view, more than any other vertical surveyed. A consolidated view, containing various pieces of information from the member’s mailing address to their account history, gives institutions a better understanding of each individual member and their relationship with the credit union.
This single member view can provide many business benefits, from member service to marketing. First, it allows credit unions to successfully consolidate member account history and determine which marketing offers are most relevant to a given member. In addition, it improves member perception, overall business intelligence and efficiency.
However, even with all of these benefits, credit unions are struggling to achieve this goal. Only 28% of financial institutions surveyed in our study claimed to have a complete view of their member base. This means that 72% of financial institutions still lack this visibility into their member base.
This is because a consolidated member view can be difficult to create in today’s business environment. First, credit unions have many points of data entry, from self-service websites to branches and call centers. All of these channels may have different databases and require different information at the time of transaction. These various points of entry can cause duplicate accounts to easily be created and lead to inconsistent data accuracy.
To realize the goal of a single member view, credit unions first need to focus on accurate contact data, ideally by implementing software tools. In the Experian QAS study, institutions that manage their data accuracy with automated methods are more likely to attempt a complete member view.
There are three steps institutions can take to improve contact data. First, information should be standardized. In many databases, there is a large degree of inconsistency when it comes to data. Fields may be missing or information may not be entered in the same format. Once contact data within a database has been standardized, credit unions can focus on the second step.
Next, credit unions should remove duplicates. It is common for databases within different departments to have overlapping members and prospects. Duplicates need to be removed so that each member only has one account. This will allow credit unions to understand each member’s account history, but also to household information and create geographic and other intelligence.
Finally, credit unions need to develop a process for updating data. Information within a database can become outdated quickly. Members are constantly moving, changing names and changing jobs. To keep up with the pace, institutions need to put a process in place to update information on a regular basis. How often this needs to be done will vary from institution to institution, but credit unions need to be aware of when data expires so that they can maintain up-to-date information with the member.
Thomas Schutz is senior vice president at Experian QAS.
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