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Cross-Selling Made Simple

Banks have a treasure of data about their customers that, by all accounts, mostly goes to waste.

But, in at least one niche, this is about to change.

Some companies that provide personal financial management technology to banks are incorporating a new cross-sell engine—which makes it easy to deliver very targeted offers.

Want to promote a credit card? Serve up a banner ad to only those customers who have a credit card elsewhere at a higher interest rate.

Eager for more boat loans? Select customers who have used their credit or debit card at a marina or a bait shop.

“I haven’t seen anything that could be this targeted before,” says Brad Strothkamp, a Forrester analyst who looked over what Intuit Financial Services began offering in May to the 400 banks and credit unions that use its FinanceWorks. He described the new functionality as exciting and innovative.

The startup Geezeo has a similar offering, now being deployed at the $1.4 billion-asset First Mariner Bank in Baltimore and a handful of credit unions.

The lure for consumers who use PFM is the ability to see all of their finances in one place. They can aggregate accounts from different financial institutions, to get an overview of how much money they have, how much they spend each month and how much they owe.

The spending is automatically categorized—from clothing to restaurants—and shown in pie charts. Handy tools allow for creating budgets, setting up alerts and bill reminders, and establishing goals.

“To have that level of detail and granularity in the system for marketing efforts, to me, was a selling point,” says Steve Kruskamp, e-commerce marketing manager at First Mariner, which expects to begin offering PFM to its customers in June. “We don’t have that capability with anything else.”

Particularly attractive is the ability to parse information about accounts a customer has elsewhere, he says.

Setting up a marketing campaign can take just minutes. Banks input the criteria for who should see an offer and type in the message they want to deliver.

Variables could include, for example, age, geographic area, spending behavior or goals. Or the focus could be customers who do business with a specific competitor or have certain types of accounts elsewhere.

The ads appear to customers only when they are using the PFM website.

To protect privacy, financial institutions never see the names of customers who are the target of a particular campaign.

Both Intuit and Geezeo give a summary of the campaign after it gets underway, showing the number of times overall that an ad appeared on screen and how many clicks it received.

Geezeo also shows, when a campaign is created, the number of customers who fit the selected criteria.

The two companies say marketers can change the criteria at any time if they decide too many, or too few, customers are being targeted.

They also say it is not apparent to customers that an ad is based on a scan of their personal information.

“They may get uncomfortable if we put, ‘Hey, Mark, we can save you money,’” says Mark Shulman, a senior product manager for Intuit.

Marc DeCastro, a research manager for IDC Financial Insights, agrees that people can get “creeped out” when a company seems overly familiar with their finances. So being less obvious is smart.

But DeCastro says he thinks many people are leery of aggregating their finances online, making him skeptical of the cross-sell potential.

“You have to convince your customers—and a significant portion of your customers for it to be really worthwhile to you—to sign up and utilize PFM,” he says.

Intuit says, on average, about 23% of the customers who use online banking at a financial institution, sign up for FinanceWorks within 18 months of it becoming available. Some banks that promote the service see adoption and usage as high as 40%.

One in five FinanceWorks users aggregates an average of five external accounts, in addition to those at the primary financial institution. (Intuit says Americans typically have about 11 financial relationships.)

For his part, Kruskamp, who uses a PFM website himself, is enthusiastic. He says First Mariner expects its free service to help attract younger customers and foster deeper relationships.

“PFM is still in its infancy. There is going to be a heavy educational push we’re going to have to do to get people to use it,” he concedes. “But for us, as a local bank, a good portion of our customer base is older, and we need to get new customers in the pipeline, so having this type of offering is really attractive to us.”

First Mariner intends to add PFM to its website under a separate tab. Customers would sign in with the same user name and password they use for online banking.

As with all those who use Geezeo’s technology, the bank would brand the service with its own name.

Of its overall deposit customers, roughly 35% use online banking, and the goal is to get half of those into PFM, says Kevin Lynch, First Mariner’s e-commerce director.

Both Intuit and Geezeo say improvements to their cross-sell tools are already in the works. They plan to evolve the technology rapidly, based on continuous feedback from the banks and credit unions using it.