Don’t let the magnitude of “big data,” or uncertainty over how best to use it, paralyze your credit union’s ability to take advantage of its great promise.
Large corporations and financial services competitors already rely on big data, increasingly using it to siphon away business opportunities with your members, says Peter Halenar, vice president of strategic partnerships for MoneyDesktop.
“I would highly suggest that you start to have the conversation internally,” Halenar told CUNA Community Credit Union & Growth Conference attendees Thursday. “You can either start to address it now, or after it’s passed you by and you have to play catch-up. That’s not a situation you want to be in.”
The world produces as much data in two days as in the previous 5,000 years, Halenar said, offering a treasure trove of information if interpreted properly. Predictive policing helps departments target areas where crime is on the rise. Netflix analyzes usage patterns of its 30 million customers each day to recommend movies or other content for their queues. Retailers target advertising to customers based on their recent purchases.
“Information is the oil of the 21st century, and analytics is the combustion engine,” Halenar said, quoting Peter Sondergaard, senior vice president and global head of research at Gartner.
Financial institutions can use big data to track when members are due for a car loan, or when they need a mortgage or other services. Credit unions also can determine which members are banking elsewhere and make detailed offers explaining how much money they’d save if they brought all their business in-house.
“When you learn to corral that information, and turn it into actions that benefit your credit union, you’ll gain wallet share, increase membership, and turn more people into the all-important primary financial institution (PFI) members.”
Many credit unions’ efforts to get involved with big data fall short because of a lack of resources, Halenar said. Personal finance management (PFM) products like MoneyDesktop filter and sift external and internal data sources and provide customized, user-friendly reports without taxing information technology departments.
Big data can free up your IT department to let it concentrate on other things that are mission-critical, he said. “Put that technology into your hands, so that you can parse, slice, dice the data in ways that are meaningful to you,” Halenar said. “It makes the organization more efficient.”