With most financial providers heavily focussed on acquisition, a declining retention rate can slip under the radar. There is immense (often unseen) potential in an active database waiting to be released. Exposing this potential and targeting the right people with the right message will maximise bottom lines, but what is the best way to approach this task?
By evaluating customers’ behaviour and identifying significant trigger characteristics within the data, an active file can be split into three simple tiers:
- Stickers: customers likely to be retained
- Checkers: customers whose likelihood to be retained is undetermined
- Switchers: customers unlikely to be retained
The stickers automatically draw your attention, loyal customers often result in the most profit with the least effort, however, the greatest potential lies with the checkers. This group of individuals are most persuadable and with the correct targeting generate the most return.
Marketing Metrix used this technique when targeting Tesco Bank motor insurance policy holders before their 12 months and 24 month renewal dates. The results proved that there was a lot of previously unseen potential to be tapped in to.