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4 Ways Economic Insights Can Sharpen Your Customer Focus

As progress toward a post-pandemic economy continues, there is a good deal of pent-up demand in the market and many consumers are ready to spend. But how can you identify and reach audiences that are likely to have the financial ability to take advantage of your offers? Do you know which consumers have extra cash or the income levels to buy? How about which consumers have the right financial profile for pay-over-time goods and services?

Marketers’ ability to answer these questions was previously hindered by a lack of quality data. Many data sets that offer consumer financial insights rely on survey-based data that represent less than 1% of households across the United States. This survey data is often old or incomplete, offers inconsistent coverage, or lacks insights on local attributes and behaviors. Furthermore, legacy technology and data access methods meant you had to cobble together these traditional data sets and undertake the time-consuming task of transferring, standardizing, and sharing the data across business users.

The good news is that Equifax and Snowflake have come together to help marketers overcome these challenges. 

Economic Insight measures from Equifax rely on a foundation of anonymous, directly measured consumer investable assets—about 45% of the nation’s assets—collected from its network of financial services firms. These measures shed light on the consumer wallet, and many marketers have successfully used them to:

  • Segment and target new and existing consumers
  • Drive customer acquisition
  • Increase marketing engagement
  • Improve marketing return on investment
  • Increase customer lifetime value

Now, Economic Insight measures from Equifax are conveniently available on Snowflake Data Marketplace, providing improved accessibility, flexibility, and governance. Through Snowflake Data Marketplace, you can access live, ready-to-query data and layer these exclusive insights with your own internal data or other third-party data to both fuel your marketing and enhance internal analytics. Without the legacy technology barriers of the past, business users can realize value from their data much more quickly.

Incorporate the key ingredients that drive consumer spending

Developed using anonymous financial data, Economic Insight measures from Equifax can help companies target prospects and customers with data that estimates:

  • Affluence (Affluence Index™)
  • Total income (Income360®)
  • Capacity to spend on discretionary items (Spending Power™)
  • Ability to pay (Ability to Pay Index™)
  • Financial durability (Financial Durability Index™)
  • Credit availability, needs, and usage (CreditStyles® Pro)

With a deeper understanding of customers’ estimated affluence, income, ability to spend, and other economic attributes, marketers can:

  • Target the right audiences based on likely ability to purchase.
  • Tailor messaging to different audiences with insight on financial capacity to spend.
  • Cross-sell appropriate products and services—or upsell premium products and services to those that likely have the ability to spend more.
  • Enhance regional marketing by developing advertising and location-planning strategies based on the economic profiles of local areas.

According to the Equifax financial assets data, true wealth is consolidated in the hands of the few: affluent households hold 69% of the nation’s assets, yet represent just 7% of households. With Economic Insights, you can target consumers who have the right economic profiles for whatever you are selling—whether it’s luxury travel, a family automobile, telecom package upgrades, or financial services.  

Here are four ways that companies are using Economic Insight measures from Equifax to boost their acquisition and customer marketing efforts:

  1. Enhance prospecting to hone in on high-potential households and reallocate marketing spend

Directing resources to the right audiences is critical—and for many marketers, the “right audience” is consumers with the ability and interest to spend on their goods and services. For example, companies can target consumers by likely total income (such as $100,000 to $200,000) and discretionary spending power (for example, $75,000 to $100,000). Or they can profile their best customers to determine which income and spending power ranges are most prevalent, and then develop prospect target audiences using the same criteria.

Based on prior analysis conducted by Equifax, consumer marketers that use Economic Insights measures can expect to discover that 10-40% of their prospect lists do not meet their desired criteria. Instead, marketers can make their list selections “smarter” by reallocating spend—sometimes as much as 60-80%—toward other consumers that are likely to have the economic attributes (estimated income, spending power, etc.) to drive conversion. 

  1. Identify audiences for top-tier treatment groups, service levels, and loyalty program benefits to increase revenue

Marketers generally strive to provide top service and offers to their best customers, but often struggle to recognize which customers truly hold the most value.

By segmenting households by their likely spending capacity, marketers can better identify those customers that warrant premium service, automatic loyalty program membership, invitations to exclusive events, and top-tier offers. For example, retailers that conduct such an analysis can expect to increase revenue potential by as much as 25% according to an Equifax internal study.

  1. Identify higher-risk segments 

For companies that offer monthly-billed or pay-over-time products and services, economic attributes can help identify current accounts that present more risk, such as non-payment, churn, likelihood of delinquency, and more. Those attributes can then be applied to enhance future marketing campaigns.

An analysis conducted for a communications provider used Economic Insight measures to better identify accounts in its portfolio that were most at risk of non-payment. The analysis revealed a segment of accounts that was 10x more likely to have a non-pay disconnect of their service. Based on this data, the provider could apply specialized treatment strategies to this account segment, while also using the same economic criteria to inform targeting of future campaigns to reduce the rate of non-paying accounts.

  1. Evaluate local markets by economic potential 

By incorporating economic insights into market analytics, companies can better assess market opportunity—or lack thereof—to find untapped markets for new locations, pinpoint existing branches and outlets that are underperforming, or identify sites for possible closure.

An auto dealer researching sites for new dealership locations used Economic Insights to assess the consumer purchase potential surrounding current markets and new potential markets. The analysis enabled the auto dealer to narrow down its list to the best 10 target markets for expansion, after initially considering over 20 locations. At the same time, the analysis revealed that several current dealerships were in low-growth markets and could be evaluated for potential resource reductions. 

Marketers need high-quality data to find the right audiences, engage with new and existing customers to realize their full purchase or payment potential, and inform market and inventory planning decisions. Consuming these powerful insights via a modern data platform like Snowflake is a game changer for marketers who can now readily access, aggregate, and share the data to quickly drive informed business decisions. Check out the Economic Insight measures from Equifax on Snowflake Data Marketplace.

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