Online to On Board: Turn Credit Education into Digital Engagement

Roman Mykhaylyshyn
Blog Post09/04/2018
Image showing creditview with offers

Looking for customer stickiness in a competitive lending market? With consumers seeking online, on-demand and personalized services, conventional marketing strategies for improving account acquisitions and customer management may not be delivering the desired results. Timing and targeting are key.

Roman Mykhaylyshyn, Head of Consumer Solutions at TransUnion Canada, explains how the best time to connect with consumers, and present them with relevant offers they’re likely to take up, is when they’re already actively monitoring their credit. Which is why your consumer engagement platform is an ideal channel for presenting offers at the right time, and enhancing your marketing efforts and customer experience.

New marketing strategies for a new type of customer

With access to seemingly infinite—and increasingly personalized—choices online, there’s hardly anything consumers can’t find, order or acquire from their electronic devices. And being able to do so is now the expected norm, rather than a ‘wow’ factor.  Power has shifted to (quite literally) the hands of consumers, and competition can be fierce.

People are overwhelmed with information and offers, and it’s not easy to stand out from the crowd. Reaching and engaging consumers requires creative strategies and significant effort. Even if you are able to do this successfully, the next step is converting those prospects into customers.

In addition, once you’ve earned their business, you need to work hard to keep it. While the adage ‘it costs more to get a customer than to keep one’ may still hold true, companies have to dedicate certain resources to preventing attrition, building customer loyalty and retaining (and growing) valuable business. This applies even to large banks, which have a win rate for loans of just 57%1. The other 43% of the time, their customers are going elsewhere for financial products like credit cards and loans.2

Meeting your customers where they’re at

Customers tend to be more likely to remain loyal to businesses that present them with relevant, personalized offers than those which spam them every so often with deals they can’t afford, aren’t interested in, or may not even qualify for. It’s therefore no surprise that conventional (and costly) marketing strategies aimed at a fairly broad audience may not deliver the return lenders expect.

By understanding what their individual customers are looking for, and what they can afford, lenders can provide real value by presenting customized, relevant offers, at the right time, at various stages of the customer life cycle.

What we’ve seen from our own clients’ experiences is that the best time to connect consumers with offers for credit is when they are already actively monitoring their credit. A TransUnion Analysis3 found that those who self-monitor their own credit are three times more likely to open a new account. Our analysis also found that customers who run credit simulations are more responsive to offers. 54% of subscribers4 to our CreditView Dashboard opened a new loan within 47 days5 of the simulation.

Image showing creditview with offers

Here’s where credit information platforms can offer tremendous value to both customers and lenders. When customers log in to view their credit information, there’s likely a reason for doing so. Smart lenders, using the right data, can present a relevant offer right there and then, making their products more appealing to customers who are already open to exploring them.

A single platform for education and engagement

Lenders using CreditView already have a powerful customer engagement platform. With the latest add-on from TransUnion, CreditView with Offers, this solution can also be used as a marketing platform for any financial institution, and for any strategy.

CreditView with Offers turns this customer interaction into a marketing channel. It allows lenders, even those with limited resources, to target customers with tailored offers at an opportune time. By using its powerful data-driven engine, lenders can match and analyze customers against multiple criteria to list offers by customer fit for multiple product types ranging from personals loans and credit cards, to vehicle, asset finance and insurance.

Financial institutions decide on the criteria for the offer and which customers would be the best fit. Depending on the business strategy and desired outcomes of the campaign, they can then tailor the offers with as few or as many criteria as they like, as qualification rules can take into account a range of variables, including credit status, (from sub-prime to super-prime), region, demographics, credit history and recent or historical credit behaviour.

Credit bureau information and scoring models enable lenders to choose from a range of variables to use in configuring the offer and determining which customers would best qualify. By leveraging credit report characteristics, scores and algorithms information to get a holistic view of the consumer before extending an offer, lenders are able to hone in on candidates that are the best fit for a particular offer at a particular time, driving meaningful uplift in response rates.

For large banks and monolines, there’s the option to create complex rules and matrices on how to qualify someone for an offer. For smaller organizations, or those that don’t have similar resources or budget, there’s the option to reach customers with relatively simple campaigns, using just a few rules and values.

Then it’s just a matter of activating the offer to prequalified customers so they see it when they log in to view their credit information. From there, the application, verification and review processes are managed by the lender as normal.

Success you can measure

Campaign metrics help to determine the cost of acquisitions, response rates and conversions. This data can be compared with the success rates of other marketing campaigns and can assist in refining future marketing efforts. Digital marketing, compared with some conventional marketing programmes, has the advantage of improving response rates, and requires minimal overhead and ongoing investment.

CreditView with Offers enables lenders to increase their new account acquisition and customer management strategies by presenting the right offer, at the right time: when a customer is already thinking about their financial needs and actively looking for information on their credit status. The platform is already there—it’s just a matter of presenting the offer to capitalize on that engagement and give the customer an opportunity to apply right then and there, if they see the offer as relevant to their needs.

Discover how CreditView with Offers can help you turn credit education into digital engagement:

1,2Used with permission from Bain & Company:
3TransUnion Credit Monitoring Analysis, Jan – Jun 2017
4The percentage of subscribers simulating who opened a new loan
5The median number of days from simulation date to new loan open is 47 days

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