Companies from all industries need to better understand their customers, but in the financial services space, it’s more critical than most. Whether you work for a bank, insurance company or in the investment sector, you’re challenged to have a better and more complete understanding of your customers than in most other sectors. Missteps in the financial services industry are critical because the engagement with our customers concerns a subject near and dear to their hearts – their financial well-being.

I read the story recently of Orbitz learning that customers using Macs and PCs tend to be looking for different things as they search their website. So they decided to offer Mac visitors the higher-priced travel offerings and PC users the lower-priced deals. Of course there were outraged Mac users, but imagine if it was Bank of America offering lower interest rates to PC users? There would be hell to pay from consumers and regulators alike. Learning more about your customers should be a way to give them more of what they want, not less.

Data Integration is the start.

It’s just a start, but it’s a big one. Bringing all of your customer data together across organizational and internal political boundaries is the first challenge, and one which many financial services firms have mastered. But gathering data from online behaviors and adding that to the mix? For many financial services firms, this still needs work. Financial Services Marketers should be looking for providers and investing in marketing datamarts that can capture the full range of customer data and interactions in one place – both online and offline. And for most, there are major silos that need to be torn down to accomplish this.

Once that’s done, there are a number of ways for you to learn more about your customers.

  1. Demographic Profiling – Once data has been consolidated and householded, you can and should append demographic information to your retail customers and firmagraphic information to your business customers. Just the basics – income, marital status, occupation, education, SIC codes, sales, etc., will go a long way to improving your ability to target the right customers with offers that make them feel they are getting your full attention. Would you rather try to sell cash value life insurance to a married high-income professional with two young children, or to a single person with no kids living in a studio apartment? The money you’ll save in marketing costs is far greater than what you’ll pay to append demographic information.
  2. Lifestyle Profiling – A customer’s hobbies and habits are a window into the way that they lead their lives. Linked with your customer data, they can be powerful predictors. For example, a person who’s into mountain biking is also more likely to be interested in other outdoor or fitness products. They may also be more interested in disability insurance or retirement plan rollovers – your data will guide you to patterns that make sense for your business.
  3. Web Behavior Profiling – Different segments of your customers will use your website differently, and search for information differently as well. You need to understand the barriers they are finding as they try to do business with you – not so you can take something away from consumers, but so that you can give people a range of relevant choices. Once you’ve understood these patterns of web behavior, evaluate what types of web behaviors should be captured at the individual level and stored back to the database for future use.

Regardless of which sector of the financial services market you work in, gaining a better understanding of your customers remains on your critical to-do list. The above analytical areas are now table stakes in marketing best practices in your industry.

Next time I start researching a financial services product, should I use a Mac or a PC?