In today’s competitive landscape, small business lenders face the ongoing challenge of marketing to new customers while keeping acquisition costs low. Too often, lenders rely on overused prospect lists which leads to low response rates. Companies need to grow profitability by acquiring more “ideal customers” using the most efficient tactics available. Innovative strategies fueled by alternative business data and automation are gaining traction across the lending industry. Let’s explore further how leading small business lenders boost marketing ROI by shifting their targeting and acquisition strategies.
How to use data to grow your prospect pool
Mass lead lists and recycled data are all too common. Available information is often outdated, and targeted customers may have a low probability of approval. So how are small business lenders growing their list of potential customers? One tool they are using is alternative business data, such as historical performance and customer sentiments. Alternative business data refers to a wide range of non-traditional sources that can provide valuable insights into a business’s creditworthiness, financial health, and potential risk. Using alternative business data helps lenders add previously overlooked businesses, such as companies with limited operating history, to their prospect list. Alternative business data not only facilitates a more accurate list of potential customers but also broadens the pool of potential targets for a lender.
Score prospects to ensure portfolio compatibility
Alternative data enables powerful insights not previously available. For example, lenders can now score prospective customers before executing any acquisition activities. Automatically scoring target customers is not only a fast and easy way to prioritize prospect lists, but it also helps evaluate prospective customers based on the criteria that matter most for a lender. A secondary benefit to scoring is that it helps pull forward risk mitigation efforts and ultimately target and acquire those customers that will lead to a healthier portfolio. Each lender may have criteria unique to their business so solutions like Verdata’s customizable marketing platform are the best fit. The correct alternative data and analytics partner can support small business lenders in identifying high-value customer targets that reflect their ideal customer profile.
Drive responses and boost ROI
Alternative business data and scoring analytics allow a vendor to focus outreach on the most-desired customers and drive efficiency throughout the marketing process. In addition, small business lenders can use insights to tailor marketing campaigns and messaging which can further improve response rates. A higher rate of response results in a larger volume of applications received. Leveraging a customized score to optimize your targeting increases the likelihood of approval delivering even more significant cost savings across underwriting and other functions within the company. This approach is viewed by many as an essential way to grow revenue while lowering acquisition costs. Small business lenders are jumping at the chance to jumpstart new and improved outreach and increase campaign ROI – especially if new strategies will deliver better long-term customers.
More effective marketing strategies are on the rise and alternative business data and powerful analytics are their driving force. If you are eager to break free from the recycling rut, improve response rates, and boost marketing ROI, learn more about Verdata.com’s marketing solution. Verdata’s proprietary risk model and verified data give you the edge you need to reach your ideal customers with ease and efficiency.