Using mobile location data to improve bank marketing results: A how-to guide
Columnist Michael Della Penna explores the challenges and opportunities that location data present for financial services marketers.
Increasingly, organizations of all sizes are turning to the power of location data to drive business decisions and outcomes that create better user experiences and financial results.
In fact, according to a recent report published by location intelligence provider CARTO, nearly all medium-sized and large organizations with over 500 employees (94 percent) leverage location data from mobile and IoT devices, and 66 percent believe location intelligence is very or extremely important to their organizations’ success today.
Perhaps even more telling is that the dependence on this critical data set is expected to accelerate even further, with 85 percent of respondents saying it will be very or extremely important to their organization just three years from now.
While most organizations believe that mobile location data is and will be critical to the success of their business, we are still in the early days of opportunity scoping and experimenting with the data.
Only a few organizations have already mastered the practical applications and use cases to leverage these insights, and even fewer have already been through the process of hiring the data analysts, marketers and location intelligence partners necessary to build the strategies and tactics to drive desired outcomes.
In this series of columns, we’ll explore how major brands across various vertical markets are moving beyond just collecting and storing location data, utilizing it to create behavioral trajectories that can enhance customer relationships and marketing effectiveness.
Vertical one: The bank marketer
There is little doubt that bank marketers view the mobile channel as critical to their marketing success. According to eMarketer, financial institutions’ digital advertising spend exceeded $8.37 billion in 2016 and will increase 50 percent to $12.44 billion in 2020. The same report predicted that financial companies would spend $7.17 billion on mobile ads in 2017, up 27.5 percent from the previous year.
But despite this massive focus on mobile, many bank marketers aren’t using mobile-related data. So, why are so few bank marketers effectively leveraging data collected from mobile devices?
- Lack of awareness of emerging datasets available.
- Lack of resources to properly leverage the data when they have it.
Understanding mobile data, including location data, provides financial services marketers with the opportunity to understand which venues consumers visit and how frequently, how much time they spend at a location, and ultimately, their journey over time.
Typically, these data assets can be pulled from the bank app (if users have provided permission) or through location data partners with similar permissions taken from third-party apps.
When leveraged, bank marketers can harness the power of these insights to enhance their marketing results in several core ways. Typical use cases include but are not limited to:
- Customer profile enhancement: Better understand where else consumer segments bank, how they spend their time and money and more.
- Customer segmentation: Most banks struggle with or are only just experimenting with customer segmentation. Mobile location data can help banks create segments based on actual behaviors including shopping, banking, travel and commuting.
- Features & functionality enhancements: Enhance relevant features and functionalities within your bank’s mobile application — such as new services, rewards, usage reminders and more — based on real-world behaviors.
- Marketing campaign management: Better understand campaign performance and attribution in real time through impression-to-visit rate measurement.
- Competitive intelligence: Better understand frequency and length of visits to both your branches and competitors’. Reviewing outliers can help pinpoint potential gaps in service or support levels.
- Branch performance: Data around time of visit and dwell time can provide critical insights on operational efficiency and on how customers engage with the brand.
While this data is no doubt powerful, it is also critical that brank marketers provide customers/users a clear benefit and value in having them share their location and be transparent in how this data will be used (e.g., analytics, advertising, marketing).
When leveraging third-party partners, do the diligence necessary to understand how the data was collected and, beyond evaluating its accuracy, make sure the key tenets of privacy are followed, including providing users notice, choice and access.
There is little doubt that as the world of marketing continues to evolve, data becomes an increasingly important competitive advantage (or disadvantage). As bank marketers turn to new and emerging data sets like location data for their marketing efforts, they will need to document the use cases, build and invest in the necessary in-house resources to create value for both their consumers and the bank and do the necessary due diligence to adhere to privacy best practices.
Then and only then will bank marketers have the opportunity to create new and powerful user experiences that will transform the way they market, engage, maintain and grow their customer relationships.