WINTrust Uses NuEdge To Identify New Customers

Institution seeks superior returns through demographics.

WINTrust believes that children are the future. As the sponsor of coloring contests, petting zoos and summer carnivals, WINTrust, a Lake Forest, Ill., holding company with $3.2 billion in assets, has built-up a sizable clientele in its Junior Savers program. "We've been able to target households that do indeed have the presence of children under the age of 17," said Jay Ross, vice president of database marketing, WINTrust. "They can start putting some money away and learn what it means to have a bank account."

Junior Savers aren't the only ones who appreciate the community events and life lessons. "Lo and behold, the parents start opening accounts at the bank," said Ross. "It's something unique that a lot of banks don't do and couldn't do properly."

WINTrust uses software and services from NuEdge, an Experian subsidiary based in Waukesha, Wis., to identify cross-sell opportunities for its own customers.

Ross joined WINTrust in 1997 after working at a catalog company in Omaha. As such, he's used to working with large quantities of data. But banking poses a slightly different challenge. "The quantity of data is higher on the catalog side, but the complexity of data is higher on the financial side," said Ross.

The NuEdge system incorporates demographic data that helps the bank to come up with more insightful results. On top of what it knows about a particular customer from its own interactions, WINTrust can incorporate several sources of information from the consumer marketing databases of Experian and Acxiom. For instance, a bank can find out about a customer's family structure, including marital status and family composition. Other variables include estimated home value and dwelling size. Even purchase preferences and lifestyle choices-such as whether someone responds to direct mail or has an interest in coin collecting-can be included in an exploratory statistical analysis.

Then, using statistical techniques such as regression and Chi-squared Automatic Interaction Detection (CHAID), WINTrust can identify the most relevant predictors of profitability. "We let the data fields tell us where should be looking," said Ross.

Despite the plethora of data sources available, it usually comes down to fairly simple indicators. "We're usually looking at elements like whether they own or rent, the length of residence, estimated household income, number of children, and age of head of household." Once a target has been identified, the bank crafts a marketing message. Then, the NuEdge system helps to manage the customer mailing, and, finally, it can "very precisely quantify a response," reported Ross.

Successful experiences at one bank usually find their way to other banks within the WINTrust family. "We can roll that out to other banks and just tweak the target segment to make it applicable to their market," said Ross.

Bank Achieves Rapid Growth

From the beginning, the bank has used core banking software from Metavante, based in Milwaukee. Now, Metavante and NuEdge have formed a partnership that will make transferring data between the two systems easier.

Such improvements will help the bank to continue reaching its internal goal of building a larger asset base without having to spend exorbitant amounts to do so. "Early on our CEO made a directive that he considers any marketing project having a 'marketing cost per asset' of less than one percent to be what he would define as a successful project," said Ross. "To date, over the last five years, we've actually been able to average a marketing cost per asset of less than 0.1 percent."