When you are a banker, sometimes your workload doesn’t come in neat memos or emails. A lot of stuff just gets dropped off on your desk with notes to “Fix This” (like below) or solve that. Fortunately, a lot of these problems are easy to solve. In fact, one of the most popular strategic initiatives among community banks right now is the nebulous “Need to increase profitability,” which for more than half the estimated banks is an easy one to solve.
Tag: Big Data
Those Somali pirates are a wily bunch. While pirate attacks off the coast of East Africa are down, the average ransom is up. Most of the increase can be attributed to going after more modern ships and with better negotiating tactics. The Economics of Security research initiative looked at 179 hijackings and interviewed professional pirate negotiators to see what can be gleaned. The results were not only interesting; they hold the keys for bankers looking to negotiate bank acquisition, a branch purchase, product pricing or a loan workout.
While most bankers are familiar with the probability of default for various lines of business, many do not have a feel for the volatility of the lending category nor the correlation to the US economy.
If you think your bank has tough employees, consider a bank that brought in a motivational consultant that had the employees walk on a 6 ft. wide path of hot coals.
Understanding your retail customer is important when it comes to bank marketing, product design, and sales. While most community banks know what their average customer looks like regarding age (greater than 35 years old), gender (male), education (college degree) and average household income ($67k), the current state of social media and data analytics can uncover a wealth of insight. We take a look at some of the stronger correlations and discuss some ways to take advantage of the huge amount of data on social media.
No doubt you are sick of hearing how “big data” will change bank marketing. As we have said before, it is all about “small data” and how to leverage simple sources of data to boost the bank’s brand and products. The question that most banks have is where do you get this data? Below is a breakdown of common sources of data that can boost your digital marketing efforts. Oddly, missing is credit file information, but we will tackle that another day. In this article, we highlight where and how to leverage some key sources of data that matters.
In a moderate corner of the big data world, lies a discipline called text analytics. Text analysis is the mining of data contained in natural language done to derive bias, sentiment, sentence structure and word usage. If you have seen a “word cloud” you have seen the basic building block of text analysis. While banks generate a lot of numbers, we generate almost as much narrative from such documents like new product approvals, customer surveys, legal agreements and mostly, credit memorandums created to document the underwriting on a loan.
When it comes to bank marketing, nothing is more important than directing your message at the right audience. In most cases, it is necessary to know a potential customer on a level deeper than their account number in order to earn their business and trust. Banks today are facing more competition than ever before, so treating someone as an individual rather than a one-dimensional account can be the deciding factor between gaining a life-long brand champion and losing one.
One problem with training bank staff is the proverbial “Man with a hammer syndrome.” If you only have a hammer, then every problem appears to be a nail. In other words, if your bank has only solved problems one way, then it is a fair bet to say that they will keep on solving problems the same way. The problem is that bank staff needs to be trained with new mental (or physical) models so that they have more tools than just a hammer.
As many of you heard, Charles Barkley got into a verbal battle with the General Manager for the Houston Rockets, Daryl Morey, last week. The money quote was Sir Charles’ Luddite-like statement that Morey is “one of those idiots who believes in analytics.” Part of that is Charles being Charles, but part of that is the all-too-common fear of the unknown and fear of anything new. Barkley should know that 75% of the NBA teams not only believe in analytics but have full-time statisticians on staff.