Chapter 4 – Customer knowledge toolkit: how to gather customer data
Many industries have little knowledge about their ultimate customers, the people who actually use their products. Retail companies have access to more information, and some are able to collect a huge amount of data about their customers. The financial service companies were the first to exploit this information resource, followed by supermarkets, pharmacies and some other general retailers. Nowadays with the present usage of data by companies, particularly digital-only companies of products, content and services, data is considered the most valuable resource.
For financial service companies, this is a consequence of the characteristics of the services and products traded. For example, no one will provide a loan to an individual without knowing who they are lending to and how to contact them, and without having professional and family information, and information about guarantees and collateral.
Products such as credit cards, cheque books and debit cards can provide valuable information regarding consumer habits and frequency of purchases. This information was originally collected for credit and fraud prevention but has proved very useful in helping us to get to know our customers.
It is the nature of the financial service industry, and the minimum required by the regulatory authorities around the world, that this data is available, together with sufficient data storage and analytical capability to prevent or minimize losses from fraud and money laundering.
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