By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
SmartData CollectiveSmartData Collective
  • Analytics
    AnalyticsShow More
    data Analytics instagram stories
    Data Analytics Helps Marketers Make the Most of Instagram Stories
    15 Min Read
    analyst,women,looking,at,kpi,data,on,computer,screen
    What to Know Before Recruiting an Analyst to Handle Company Data
    6 Min Read
    AI analytics
    AI-Based Analytics Are Changing the Future of Credit Cards
    6 Min Read
    data overload showing data analytics
    How Does Next-Gen SIEM Prevent Data Overload For Security Analysts?
    8 Min Read
    hire a marketing agency with a background in data analytics
    5 Reasons to Hire a Marketing Agency that Knows Data Analytics
    7 Min Read
  • Big Data
  • BI
  • Exclusive
  • IT
  • Marketing
  • Software
Search
© 2008-23 SmartData Collective. All Rights Reserved.
Reading: How Predictive Analytics Turns Banks into Fortune Tellers
Share
Notification Show More
Aa
SmartData CollectiveSmartData Collective
Aa
Search
  • About
  • Help
  • Privacy
Follow US
© 2008-23 SmartData Collective. All Rights Reserved.
SmartData Collective > Analytics > Predictive Analytics > How Predictive Analytics Turns Banks into Fortune Tellers
Predictive Analytics

How Predictive Analytics Turns Banks into Fortune Tellers

Brett Stupakevich
Last updated: 2011/11/03 at 3:39 PM
Brett Stupakevich
4 Min Read
SHARE

predictive analytics turns banks into fortune tellers 300x200 photo (financial services)

Author: Linda Rosencrance
Spotfire Blogging Team

predictive analytics turns banks into fortune tellers 300x200 photo (financial services)

More Read

big data makes ach payments viable for small businesses

Big Data Makes ACH Payment Viable for Small Businesses

5 Ways Your Retail Banks Can Use Data to Better Serve Digital Natives
How AI Is Solving Banking Challenges During The Coronavirus Pandemic
Here’s How Blockchain Can Change Bancassurance
Here’s How Big Data Influences Banking And Online Lenders

Author: Linda Rosencrance
Spotfire Blogging Team

Did you know those stuffy old financial institutions steeped in tradition have joined the ranks of 21st century companies by employing predictive analytics , these to improve customer service? Yup, using predictive analytics, banks are devising more effective ways to manage their relationships with customers including developing better advertising and marketing campaigns; determining customer buying habits (up selling and cross-selling initiatives); and creating long-term customer loyalty, retention, customer screening and rewards programs.

For example, Chase “has harnessed the power of predictive analytics to make data-driven decisions about its consumer loan and myriad other lines of business,” according to this blog post by Beth Schultz. The bank is analyzing its data to target customers with products of interest to them. And one customer, at least, seems to be all for it.

This customer was shocked—pleasantly so—to get a letter from Chase suggesting she consider refinancing her mortgage. Chase hit her with that idea because she was such a great customer.

And how do you think Chase knew she was such a super customer and that she qualified for its “lower your mortgage” program for valued customers? Well, predictive analytics, of course.

There are a number of ways banks use predictive analytics to improve customer service, according to Schultz colleague’s, Cordell Wise.

Wise says, “Believe it or not banks have developed fairly sophisticated processes for optimizing customer value that are effective, practicable, and adaptable.”

Wise gave Schultz some examples of how financial institutions use predictive analytics:

  • Credit card companies use predictive analytics to manage credit lines and collections as well as to target customers with exactly the right direct mail campaigns
  • Insurance companies use predictive analytics to set premiums
  • Banks, insurance companies and even government agencies have turned to analytics to root out fraud.

In fact, Wise says any company can use predictive analytics to anticipate risk, including interest rate risk in financials or price (market) risk in commodities or exposure in energy markets.

Banks can also use analytics as interactive tools to help them plan their strategies and make better decisions by creating interactive maps of the problems they’re trying to solve “complete with decision levers, reactions to decisions and ultimate objectives,” according to this article.

By mapping the connections among them, banks—or any company for that matter—can see the assumptions they’ve made, then use those assumptions as well as the pertinent data to “see what happens” when they change some of their assumptions.

Bottom line—banks will make better decisions if they use predictive analytics, than if they don’t.

Next Steps

Want to learn how to make better decisions with predictive analytics? Register for our live webcast Predictive Analytics with Spotfire tomorrow, November 4th, at 11:00 AM EDT.

Linda Rosencrance
Spotfire Blogging Team

Photo Courtesy of JohnLund.com – “The Stock Photo Guy”

TAGGED: banking
Brett Stupakevich November 3, 2011
Share This Article
Facebook Twitter Pinterest LinkedIn
Share

Follow us on Facebook

Latest News

smart home data
7 Mind-Blowing Ways Smart Homes Use Data to Save Your Money
Big Data
ai low code frameworks
AI Can Help Accelerate Development with Low-Code Frameworks
Artificial Intelligence
data Analytics instagram stories
Data Analytics Helps Marketers Make the Most of Instagram Stories
Analytics
data breaches
How Hospital Security Breaches Devastate Local Communities
Policy and Governance

Stay Connected

1.2k Followers Like
33.7k Followers Follow
222 Followers Pin

You Might also Like

big data makes ach payments viable for small businesses
Big Data

Big Data Makes ACH Payment Viable for Small Businesses

5 Min Read
big data in banking
Big Data

5 Ways Your Retail Banks Can Use Data to Better Serve Digital Natives

9 Min Read
AI is solving banking challenges
Artificial IntelligenceExclusive

How AI Is Solving Banking Challenges During The Coronavirus Pandemic

7 Min Read
blockchain can change bancassurance
BlockchainExclusive

Here’s How Blockchain Can Change Bancassurance

7 Min Read

SmartData Collective is one of the largest & trusted community covering technical content about Big Data, BI, Cloud, Analytics, Artificial Intelligence, IoT & more.

ai is improving the safety of cars
From Bolts to Bots: How AI Is Fortifying the Automotive Industry
Artificial Intelligence
ai in ecommerce
Artificial Intelligence for eCommerce: A Closer Look
Artificial Intelligence

Quick Link

  • About
  • Contact
  • Privacy
Follow US
© 2008-23 SmartData Collective. All Rights Reserved.
Go to mobile version
Welcome Back!

Sign in to your account

Lost your password?