Failing to Monetize Data? You Can Bank on It.

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A few years ago my family decided to move from one of the western suburbs of Chicago to one of the northern townships about 30 miles away. As with anyone who sells a house via a realtor in the U.S., the home listing in the MLS database is more-or-less public information available via realtors or real estate aggregators like Zillow or websites.

If you have gone through the dreaded process of selling a home lately, you remember being inundated with mailings from real estate companies, mortgage brokers, moving companies and other businesses looking to latch onto your move. It seemed every local business related to moving or home buying had contacted us, except one: our own bank.

Through a series of acquisitions over the past 40 years, I now bank with one of the largest financial institutions in the world. (Hey, it’s nice having a seven digit account number I can memorize.) Even with a relationship spanning several decades, including a dedicated banker, I didn’t receive a piece of mail, an email, a phone call or text. Think about that for a moment.

When is the number one milestone that compels people to change banks? When they move, of course. It seemed my bank either didn’t know or didn’t care that I was moving. Either way, it’s unconscionable that my bank failed to:

  • Offer me a mortgage
  • Offer me a home equity line of credit
  • Introduce me to a new local branch and banker
  • Update our address information on file
  • Remind me or help me move the items in our safety deposit box
  • Offer to print new checks

In fact over a year after we moved and I sorted out all these items on my own, I received a call from my private banker at the old location who still didn’t know we had moved. By then this bank had even subsumed the mortgage from the originator! Yet they were still unable to make the connection internally.
How stupid-simple would it be for even just a high school kid to write an app that matches homes in the MLS with the bank’s customer database? Probably one night’s worth of coding, an energy drink and a protein bar.

But my bank isn’t unique. Recently I spoke with the chief data officer (CDO) of another major bank that fails to track anything about its customers’ activities other than their transactions. And the CIO of a local community bank admitted to me that they’re losing business as their clients age. I asked if they knew anything about their clients’ children–the obvious choice for wealth/company inheritance and relationship continuity. Of course not.

In today’s world of readily-available exogenous data and easily-implementable predictive analytics, there’s simply no excuse for failing to understand your customers beyond your immediate touchpoints with them, and to anticipate their needs. As a business, your survival depends on it. And as a CDO or CIO your career probably depends on it too. Time to get moving.

(About the author: Doug Laney is vice president and distinguished analyst, Chief Data Officer Research and Advisory at Gartner Group. This post originally appeared on his Gartner blog, which can be viewed here)

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