Sunday, August 1, 2010

Bad Data Costs Your Bank Money

Banks and Credit Unions of all sizes can cut a large chunk of operational and marketing expense by simply paying more attention to the quality of customer data. As absurd as this may sound, it is absolutely true. Routine and marketing mailings to bad addresses, as well as service and marketing calls to bad phone numbers are costs that add up very quickly and waste your valuable operations and marketing dollars.

Consider this example:

Marketing or operational mailing pieces per month = 20,000
Cost per mailing piece (production and postage) = $1.25
Total monthly cost = $25,000
Total annual cost = $300,000

Month 1 bad/outdated addresses = 1,000 (5% of mailing)
Cost of month 1 bad/outdated addresses = $1,250

Add 1% growth of bad/outdated addresses per month = 16% annually

Even if half of the bad addresses at some point in the year update their addresses, that is still 8% annually or $2,000 per mailing and $24,000 per year.

If your bank/credit union is like most institutions, you could probably put that money to use somewhere else where you would see a return on it.

So, do you have a strategy in place to deal with the degrading quality of your customer data? Do you have a process to regularly audit and review customer data with those who know the data best, the customers themselves?

Quest Analytics works with clients on these very scenarios. As a result, we now offer our IQDataQuality(TM) solution. It puts a proven process in place to ensure your customer information is validated at routine intervals by your front line. Our solution works directly with all teller applications and core systems.

Click here for more information on IQDataQuality:

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