Beyond Basic Strategies

Document created by Makenna.Brei Advocate on Aug 17, 2017Last modified by Makenna.Brei Advocate on Oct 12, 2017
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Recommendation 1: Data

Regulatory changes have dominated strategy design

Focus on data availability, affordability and holistic customer view:

  • Out of Order across any card
  • Total cards utilization
  • Total Balance
  • Overindebtedness Indicator
  • Total Exposure
  • Sustained Minimum Payment Flag

Design data driven optimized strategies, challenge existing champions!

  • Valuable insights into decision key predictivness and data segmentation
  • Often simplifies strategies with significant increase in performance
  • Strategies large, complex with new policy constraints 'added on'

 

Recommendation 2: Increase use of Configurable Decision Areas

Identify and eliminate manual processes

Pricing and product change popular for identifying and encouraging 'front of wallet' behavior

  • Downwards pricing = encourages activation
  • Higher balances on other cards = offer card upgrade
    • Increases customer loyalty and spending

Reissue: warn out of order customers they might fail reissue

  • If the customer has other products with you, don't fail to reissue due to inactivity

Use FICO Customer Dialogue Manager

  • Multi channel marketing campaign management
  • Provides holistic view of your customers' interactions and behaviors
  • More targeted, relevant and timely communications

 

Recommendation 3: Additional Communication Offerings

Strategies remain aggressive, now to improve contact

More automated interactive voice campaigns and SMS, using tools such as FICO Customer Communication Services

  • Use for pre-delinquent and early 1 and 2 cycles
  • Ensures only 'connected' calls transferred and allows staff to work 'live' calls only
  • Substantial productivity improvements in customer contact and lower roll rates
  • SMS in particular provides less evasive customer contact

One US lender reported:

  • 42% increase in right party contacts
  • 30% increase in payments collected during contact
  • Average roll rate reduction of 8% with a large reduction in cost of staffing

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