By: Ellyn Raftery
Chief Marketing Officer & Global Sales Operations, FIS

You almost certainly remember receiving a heartfelt card in the mail. It could have been a congratulatory note or condolences, from a loved one or a friend. Knowing someone was sharing that life experience—a graduation, their wedding, birth of a new child—made a memorable impact.

That, in a nutshell, is life events marketing: Being there to support a customer through a big transition, like having a baby or, as is becoming common as Baby Boomers age, managing through a wealth transfer.

Life events marketing is nothing new but, as social norms have shifted, it has become much more difficult to do this well. To be successful, bank marketers are encouraged to take a much broader, holistic view of their customers—to align with and understand the overall storylines of their lives.

Before a Planned Life Event, There’s an Aspiration

According to FIS’ 2017 Performance Against Customer Expectations (PACE) Report, which surveyed U.S. bank customers, the number-one way for banks to grow their businesses is through supporting their customers in “achieving financial goals that are important to my life.” However, the PACE Report found that banks are falling short at doing this, based on consumer expectations.

Why? Because these big life-changing events play out over months and years of planning and banks need to be there for their customers throughout that process. The good news for banks is that the PACE data also showed that, across the board, when asked where they would turn for financial assistance for a future life event, consumers overwhelmingly cited their primary bank as the first choice. Yet, the data still shows that the primary bank loses out on more than half of their customers’ auto loan, home mortgages, and investment accounts.

An approaching life event is both a great risk and opportunity for a bank, as it is a moment when the consumer’s purchasing behavior can radically change. A misstep in or lack of communication can result in a lost customer, so the offer, timing, and message must be just right.

Moving from Shotgun Marketing to Highly-Targeted Rifle Shots

The trap for bank marketers is to continue to rely on traditional product marketing: Blanketing a zip code with postcards or shotgun email blast that asks, “Need a Mortgage?” But, to establish a deeper, long-lasting relationship with today’s digital-first customers, banks need to be much more targeted in their messages and marketing tactics. The key is not just better data analytics—bank marketers have heard this for years—but actionable predictive analytics.

Bank marketers can now proactively identify types of financial activities that may indicate an imminent life event, predictive data points FIS calls “Key Lifestyle Indicators (KLIs)”, based on real-time analysis of customer transactional data and socioeconomic information. This information can then feed a highly tuned algorithm to develop the most-appropriate offer based on that specific customer’s life situation, risk profile, and value to the bank.

Finally, a highly-targeted message is sent via that individual’s preferred channel, as indicated by his or her past interactions. Results can then be used to validate or alter the KLIs used by the bank’s prediction engine as well as optimize offers and messaging for stronger conversion over time.

Examples of Key Lifestyle Indicators

Here are some examples of common customer profiles and potential corresponding KLIs:

  • For College-bound: Birth records, age of current children, purchases at college bookstores, and of course tuition payments.
  • For Newlyweds: Purchases related to wedding boutiques, venue rentals, photographers, etc.; opening a joint account or naming a new beneficiary; address and name changes are critical clues.
  • For Home Buyers: Credit checks, pre-approval requests, website viewing habits, debt-to-income ratios, history of rent payments.
  • Future Wealth Transfers: Age and location of children, retirement/social security filings, senior memberships, cash inflow from investment accounts such as 401k plans.

Even with technology taking a lead role, the bank teller or call center is still the most critical touch point. They can instantly confirm expected life events and gather customer information not captured in swipes and clicks. Importantly, if alerted about a targeted offer they are in a powerful position to reinforce the offer and move a potential opportunity forward.

Building Trust Long Before a Life Event Arrives

Another key finding of the PACE Report is that, across all age segments, consumers report being most frustrated in “finding out what the best investments are for me personally” and “finding someone trustworthy and knowledgeable about my options.” To marketers, the message is clear: Free and trusted information is crucial for building better relationships with customers and capturing more of their business.

Unfortunately, “apply for a loan” doesn’t help a potential first-time home buyer understand what they can afford in their market. The opportunity then is to strive to transition from a single-minded focus on “product” promotion to becoming trusted educators and advisors. This is especially true when marketing to millennials, a generation far less “do it yourself” than previous ones.

Blogs are not a magic bullet, as people engage with information differently. How-to guides, walk-through videos, infographics, calculators, checklists, etc.— all need to be part of your content mix. Most importantly, it must be easy to understand and even easier to find through a bank’s website, social media, and even mobile application.

While not every bank is ready to jump into the deep end of predictive analytics, we can all make it easier for customers to find the trustworthy information they so desperately want.