By Scott Logie is Customer Engagement Director at marketing data and insight company REaD Group and Chair of the Customer Engagement Committee of the DMA (Data & Marketing Association).

Now more than ever, data is the key to building long-lasting customer relationships and engendering loyalty. Customers expect their financial service provider to recognise them across multiple platforms and channels online and offline, and to know about them so they can receive personalised comms. At the same time, they expect those providers to keep their information secure and treat it with respect.

As a financial services provider, the information you hold on your customer is the foundation of any lasting relationship. Think about it like this: when you go on a first date, the majority of time is spent trading data to find common ground. You then need to make sure you retain, use and update that data correctly over time. Forgetting your date’s surname or when they change their mobile phone number is not going to help you build a long lasting relationship! It is no different as a financial institution: you still need to build up knowledge, and retain and keep that knowledge up-to-date.

You must also use this data accordingly. ‘Using it accordingly’ can be explained by the ‘concierge v creep’ concept. The concierge gets it just right – ensuring you have your favourite drink in your hotel room, getting tickets for a show they know you would like. People find that thoughtful and inspiring. When it strays over into creep is when it goes a bit far – over-using your first name, for example.

In financial services terms, this might be using the data you hold on someone to notice they are sliding into debt and extending their overdraft (concierge) or noticing they spend a lot of money on nappies and congratulating them on the birth of their baby (creepy, surely!). It’s all about balance.

There are a number of ways to make sure your customer data is in excellent condition, and we’ll explore those here, along with some examples of how this data can be used to develop deep and meaningful relationships with your customers.

Keep it clean

When you realise the rate at which data decays, keeping it clean is a no brainer. Data decays faster than ever before: every day, 9,590 households move; 1,671 individuals pass away; and there are 3,000 daily changes to the Postcode Address File (PAF). No wonder, then, that almost one in five businesses have lost a customer because of incomplete or inaccurate data.

But more than that, the law necessitates clean data: GDPR Article 5 requires that personal data be kept current and accurate, so as a business, you must ensure that the quality of your data is optimised and completely compliant. Choose a trusted data cleaning suite to keep your data clean in real-time: suppress relocated customers and find verified forwarding addresses and new occupier details for these contacts; and screen for deceased contacts. As well as ensuring you are compliant, it also delivers huge cost savings, improves ROI and reduces the risk of brand damage.

Enhance it

The more you know about an individual, the better your marketing will be: the right data means better marketing decisions and increased ROI. With a trusted data partner, you can access comprehensive, clean, accurate and responsive consumer marketing data to find and get to know your customers better or find new ones to approach thanks to a greater breadth of understanding. Sourced from lifestyle, digital and transactional data as well as open source information available at postcode level, this GDPR-compliant data is offered with hundreds of variables to aid your selections.

Act on it

You may have a lot of information about your customers, but it is knowing what to do with that information that is the key to true engagement, success and more profitable relationships.

To further improve your customer relationships, analysis from top line insight and profiling through to complex modelling will turn raw data into actionable knowledge. This will enable you to uncover new markets and customer insights to optimise customer acquisition and retention campaigns.

Here are three ways you can use data insight in order to improve your customer relationships.

1. Personalise it

Data enables you to personalise your marketing campaigns and in turn increase ROI. Personalisation should be a basic hygiene factor in customer engagement now. And this isn’t just about knowing a name and salutation but about using the data you hold sensibly, sensitively, and accurately.

Using the data you hold on your customer’s lifestyle and interests, you can build a better relationship by ensuring that the engagement is relevant and helpful. This will in turn increase a response and hopefully engender trust.

2. Re-engage

It is possible to select or append financial-specific variables to retail or re-engage with customers, e.g. financial products owned, investment activities, affluence indicators, high net worth, disposal income, spending behaviour and so on.

You can also engage with customers at different life stages; those that influence their financial decisions and planning, such as buying a house or having children (but remember, don’t be creepy). Data on home mover indicators and presence of children can help inform better communications with existing and/or lapsed customers.

3. Protect vulnerable customers

The world has changed dramatically, with less face-to-face contact and a corresponding increase in digital services. At the same time, many individuals are newly suffering from financial difficulties. More than ever, financial institutions need to ensure they are targeting all their customers appropriately, especially the vulnerable ones, and again, data is an invaluable tool to help them do just that. Not only can data give you a greater insight into your customer base at local and national level, enabling you to maximise marketing and sales opportunities and operational efficiencies, but you can now add to this the fundamental requirement of post-COVID communications: communicating appropriately with vulnerable and potentially vulnerable customers.

A successful, long-lasting relationship

The key to a long-lasting customer relationship is data. But, as we’ve hopefully demonstrated, not all data is equal. Put in place good data practices – it’s never too late to start – to keep your data clean, compliant and up-to-date. With that foundation in place, you can then start to build a valuable and valued relationship with your customers thanks to the actionable insight that data will yield. Most importantly, think like the concierge: if you can deliver what your customer needs, even before they know they need it, you’ll have a connection for life.