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Is Your Bank (Really) Their Primary Financial Institution?

In today’s rapidly evolving financial landscape, outdated methods for identifying primary clients cost banks revenue and growth potential. Competitors who use data to identify their clients’ primary financial institutions are gaining an edge over banks with a limited understanding of their most valuable customers. 

The concept of a “primary client” is essential for driving customer loyalty and maximizing long-term profitability. However, relying on traditional metrics like account balances and a limited set of products is no longer enough in today’s complex financial world.

While some banks try to improve their approach with metrics like average balances or direct deposits, these methods offer incomplete snapshots and miss the bigger picture. The explosion of online banking and financial products and services further complicates matters, making it incredibly difficult to gain a clear understanding of a customer’s true financial relationship with your institution.

Uncovering customer insights from massive amounts of data

The key to unlocking this valuable insight lies in customer behavior. There’s no better way to understand behavior than through transaction analytics. However, the challenge lies in the sheer volume of data involved. Millions upon millions of records — deposits, withdrawals, transfers, bill payments, etc. — create a complex web of financial activity. Sifting through this data manually is simply not feasible.

The good news is that technology offers us a powerful solution. By embracing products like Salesforce Data Cloud, which can consolidate information from disparate sources and harness the rich insights within transaction data, we can redefine what it means to be a primary client with remarkable accuracy. Once identified, Data Cloud can also help banks proactively identify churn risks, tailor product recommendations for greater customer satisfaction, and spot prime growth opportunities. 

Think of transaction data as a treasure map. Every single deposit, withdrawal, bill payment, and transfer tells a story about a customer’s financial habits, priorities, and income level. By analyzing spending habits, usage of accounts, and relationships between accounts, banks can gain crucial insights. 

For example, a customer might hold a mortgage with you but pay it consistently from an external bank account. This suggests a weaker primary relationship and the potential for cross-selling checking or savings products to capture more of their financial activity.  

This focus on behavior over simple account metrics provides a significant advantage to banks in a fiercely competitive market. Transaction and broader relationship data offer a more nuanced and dynamic way to define primary clients because they reveal true behavior, are hard to manipulate, and can produce early warning signs that a relationship is shifting. 

When you combine this transaction data with other readily available information, such as loan activity, demographics, and product holdings, you gain a remarkably detailed picture of a customer’s true banking relationship.

Why does this enhanced definition of primary clients matter?

Here are a few key reasons:

Identifying growth potential: Transaction analysis reveals who’s ready to convert from a non-primary to a primary client. Maybe they exhibit consistent saving patterns or have recently started using your institution for bill payments. These are signals of deepening engagement and a prime opportunity for targeted outreach and product offerings.

Preventing false positives: Not all increases in primary clients are equal. Seasonal surges (e.g., tax refunds) can temporarily inflate numbers. Transaction data in banking helps us see through these fluctuations, ensuring we focus resources on customers with genuine long-term potential.

Uncovering hidden opportunities: A customer might hold a mortgage with you but pay it from an external bank account. This suggests a weaker primary relationship and the potential for cross-selling checking or savings products to capture more of their financial activity.

The competitive edge: Banks that understand their primary clients through transaction data can outperform competitors still relying on outdated models. This leads to more successful marketing and more personalized product recommendations. 

By analyzing transaction data, banks can understand a customer’s unique financial journey. This allows for personalized offers and proactive guidance, solidifying the bank’s role as a trusted primary financial partner.

Empowering proactive strategies

By leveraging the power of Salesforce Data Cloud and transaction analytics and understanding income dynamics, financial institutions can move away from a one-size-fits-all approach to identifying primary clients. 

Instead, they can:

  • Deliver personalized product recommendations based on actual needs, behaviors, and income levels.
  • Offer targeted financial guidance that strengthens customer relationships and builds trust.
  • Identify high-risk customers likely to churn and proactively intervene to retain them.
  • Gain a strategic advantage by understanding client behavior in a way that competitors cannot.

Ultimately, redefining primary clients with sophisticated data analysis is about more than just a label. It’s about understanding the evolving nature of customer relationships and using those insights to build a stronger, more sustainable customer experience.

Let’s talk solutions

Financial institutions face immense pressure to keep up with today’s digital capabilities. That’s where our team comes in. Atrium’s certified experts have decades of industry experience in Salesforce Data Cloud, transaction analytics, and income insights to help businesses like yours understand your primary clients and build a scalable data strategy.

Learn more about our solutions for financial services firms.