Trended Data – Drive Profitable Growth While Minimizing Risk

This blog if the fourth article in a 5-part series. It originally published on January 26, 2017 and was updated on July 17, 2019. Trended data can help businesses strengthen marketing and risk management strategies. Having deep insights into a consumer’s financial profile and behaviors over time can improve risk and marketing performance beyond the static measures used today.

Expand Your Universe of Marketable Customers

Incorporating trended data into your marketing efforts can help expand your universe of prospective customers without changing your risk appetite. By analyzing financial behavior over a period of time, trended data delivers a more dynamic view of the customer. In turn, you can better gauge the trajectory of consumer spending and repayment behaviors – good or bad. What’s more, trended data helps you improve segmentation of consumers by prime, near prime and sub-prime segments.

For example, as companies are looking for new ways to expand their reach, they are generally looking to the near prime segment. Are consumers in that segment a good risk? Are they improving their financial profile, or is it on a downward spiral? Analyzing data over time shows you the trajectory of spend, repayment, income, and many other financial behaviors. Therefore, you can determine how a consumer manages his/her credit over time, allowing you to extend an offer of credit, increase a credit line or offer a lower interest rate without potentially affecting your existing risk appetite.

Deepen Customer Relationships

In addition, trended data can help you deepen relationships with existing customers. You can determine which customers may be more likely to respond to an offer, which customers may be most likely to repay a loan, which customers should get a line extension, and more. By knowing how consumers are behaving over time on your product and others, you can determine the most profitable ways to manage existing accounts, whether through credit line increases, balance transfers, cross-sell, or perhaps risk mitigation. In conclusion, trended data positions you to better calculate future account profitability, as well as customer lifetime value.

Learn how Equifax can help you drive more profitable growth. And read our other articles in this 5-part series:

• Part 1: Trended Data – Becoming Mainstream
• Part 2: Trended Data - Benefits to Lenders
• Part 3: Trended Data – Impact on Credit Decisions
• Part 5: Trended Data – Minimize Risk and Head-Off Default