20 Questions

A few reflective questions about how well you know you're customer economics

Sometimes the question matters more than the answer

With the 2023 planning cycle underway, a little introspection can help inform your perspective and point you toward building a stronger/more sustainable institution. With that in mind, a few questions (20 more or less) to ask yourself:

  • Are we getting our money’s worth, i.e., what is our actual cost of acquisition? By segment?
  • What do our top clients have in common? Or another way, what characteristics could we use to identify our best customers before they are customers?
  • How much is our marketing activity adding to customer acquisition and retention? Not attribution, but real incremental effect?
  • How much revenue (interest/non-interest) does each customer generate? Can we accurately predict how much they will generate (at the individual level)?
  • What is our customer churn? How long do we retain customers? By demographic segment? By acquisition channel?
  • What is the ratio of lifetime value to acquisition cost? Considering margins on the products involved, how long until we can recoup those costs?
  • Can I identify the likelihood of conversion for cross-sale campaigns? Do you have an offering personalized for every customer interaction?
  • What share of my customers do my competitors have (like payment processors for SMBs, for example)? Do I have a win-back campaign planned/executing for each?
  • For all of these numbers, how do we compare to banking industry averages? Our top competitor? Who you benchmark against/hope to be like? Best in class?

Not even the most data-driven organization that spends 5% of its assets on analytics can completely answer all of this. But one more question for you, by not knowing the answer, which of these questions is keeping you from reaching your goals? That should guide your plans and activity rolling into the new year.

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