The analysis is a key component of The Stellar Indirect Tool Kit℠ – it’s what allows us to help you get the most from your marketing dollars to maximize the transformation of indirect loans into PFI relationships. To facilitate this, Stellar uses your current and historical institution-wide account data to segment your existing indirect relationships into three categories. The ultimate goal of this segmentation process is to identify what we refer to as your “franchise” carrier routes. Based on 20 years or growing retail market deposit share for our clients, we have developed a formula for identifying future growth potential by geography in any given market. Here’s a high-level outline of our analytics process accompanied with maps of each segment in this particular market:
Depending on your specific market and branch footprint (both geographically and in terms of highway infrastructure), a number of indirect relationships will be designated as “Outliers”. These loans are unlikely to transition into PFI relationships, and are earmarked for a only small number of cost-effective marketing touches over their lifetimes.
The second category designated are the “Proximity” relationships, and are those that fall near enough your branches to have a meaningful in-branch experience if desired (and when required). Given the convenience of your branch locations to these customers/members, a more-frequent marketing plan is employed.
The final – and key – category are those of the “Franchise” segment. Indirect loan holders are elevated to this category based on a variety of historical trends seen across all account types. Not least of which is historical checking account activity – both incidence and duration. Stellar examines market penetration, historical account opening trends, and attrition-weighted account longevity to determine which subset of geographically-relevant indirect loan holders will tend to transition into full PFI relationships. An aggressive series of marketing campaigns is employed for this category.
While the volume and frequency of marketing touches to existing indirect relationships varies depending on the category to which they are assigned, all individual touches are timed based on the unique properties of the individual indirect account holder, and their level of additional account engagement (if any) with your institution. That’s an important point to remember – all efforts are tailored to the individual account holder. We use the three categories – “Outliers”, “Proximity”, and “Franchise” simply to help better allocate finite marketing funds for a higher overall projected ROI. The usefulness of these insights goes beyond indirect auto loans: The monthly analytics and targeting data that Stellar provides as part of the Indirect Tool Kit can be used for both external as well as existing internal marketing efforts, across all account types!