With consumers having more credit options than ever before, it’s imperative for lenders to get their message in front of ideal customers at the right time and place. But without clear insights into their interests, credit behaviors or financial capacity, you may risk extending preapproved credit offers to individuals who are unqualified or have already committed to another lender. To increase response rates and reduce wasted marketing spend, you must develop an effective customer targeting strategy.
What makes an effective customer targeting strategy?
A customer targeting strategy is only as good as the data that informs it. To create a strategy that’s truly effective, you’ll need data that’s relevant, regularly updated, and comprehensive.
Alternative data and credit-based attributes allow you to identify financially stressed consumers by providing insight into their ability to pay, whether their debt or spending has increased, and their propensity to transfer balances and consolidate loans. With a more granular view of consumers’ credit behaviors over time, you can avoid high-risk accounts and focus only on targeting individuals that meet your credit criteria.
While leveraging additional data sources can help you better identify creditworthy consumers, how can you improve the chances of them converting? At the end of the day, it’s also the consumer that’s making the decision to engage, and if you aren’t sending the right offer at the precise moment of interest, you may lose high-value prospects to competitors who will.
To effectively target consumers who are most likely to respond to your credit offers, you must take a customer-centric approach by learning about where they’ve been, what their goals are, and how to best cater to their needs and interests. Some types of data that can help make your targeting strategy more customer-centric include:
- Demographic data like age, gender, occupation and marital status, give you an idea of who your customers are as individuals, allowing you to enhance your segmentation strategies.
- Lifestyle and interest data allow you to create more personalized credit offers by providing insight into your consumers’ hobbies and pastimes.
- Life event data, such as new homeowners or new parents, helps you connect with consumers who have experienced a major life event and may be receptive to event-based marketing campaigns during these milestones.
- Channel preference data enables you to reach consumers with the right message at the right time on their preferred channel.
Target high-potential, high-value prospects
By using an effective customer targeting strategy, you can identify and engage creditworthy consumers with the greatest propensity to accept your credit offer. To see if your current strategy has what it takes and what Experian can do to help, view this interactive checklist or visit us today.