When people think of “account acquisition strategies,” they most likely think about the letters they receive in the mail from the bank, announcing an incentive to open a new checking account or credit card with an amazing introductory interest rate. With bank acquisition, there are a TON of factors that all filter into why you received the letter, how much the incentive was, and how personalized the piece was. Why can’t these same strategies work for Consumer Finance companies? Well they can - and here is how!
Pre-qualified Mailings and Live Checks
Knowing your target audience, and the most likely candidates for a new loan all starts with data. Putting out a live check on the streets is a scary proposition, and that’s why many lenders won’t do it. Fact is, though, it might be the most effective method of creating new accounts. It’s not nearly as scary when you work with the right quality control processes and the right partner to make sure you are sending checks to people that are likely to convert and pay off loans in a timely manner.
Profiling & Modeling
You probably know what some of your best customers look like, and you probably want more like them. Chances are though, no one characteristic defines a group of good customers. This is where profiling and modeling come in – you can find a variety of characteristics that shape what you see as an “ideal” customer. Once you’ve profiled your best customer, you can build a model, in essence some predictive mathematics, for your marketing to reach them. There are hundreds of variables - including demographics, lifestyle characteristics, socioeconomic variables and aggregate credit information, which all make it easier on you to get your best customers.
Taking profiling and modeling to the next level, consumer lenders can utilize segmentation to find the customers most likely not to default on a loan. Segmentation is the art of dividing a universe into like, or similar, clusters. Lenders can actually tailor the creative to speak more effectively to defined segments. Building segmentations is a very creative process, as the very best segmentations are highly aligned with goals and strategies and are built to be leveraged to drive profitability.
Combined with modeling and offers like live checks and pre-approved offers, these strategies can all work in tandem to increase new customer acquisition, retention, and market share.