Understanding STICK
STICK is designed to analyze product adoption, activity levels, and household potential over specific stages of a customer’s or member’s relationship with the financial institution (FI). It focuses on understanding the stickiness of products and customer or member relationships, aiming to enhance engagement and increase cross-sell opportunities over time.
Data Points Analyzed in STICK
STICK examines several critical metrics to provide insights into engagement, growth potential, and the effectiveness of various product offerings, including:
- Product Mix: Analyzes which products or services customers or members have adopted over time. Understanding this mix can help in identifying opportunities for complementary product recommendations.
- Balances: Tracks account balances to assess the financial engagement and value of customers or members at different stages.
- Activity Levels: Measures customer or member activity, such as transaction frequency or login rates, to gauge engagement levels and identify early signs of potential churn.
- Household Potential: Assesses the potential for each household to expand their relationship with additional products or services, which informs cross-sell and up-sell strategies.
Objective
The primary objective of STICK is to optimize customer or member engagement and deepen relationships through tailored product offerings. By understanding engagement levels and product adoption patterns at each stage, businesses can make data-driven decisions to enhance satisfaction and increase lifetime value.
Customer or Member Stages
STICK focuses on specific stages of customer or member tenure, typically segmented as:
- First 90 Days: During this onboarding stage, customers or members are introduced to essential products and services. Engagement efforts focus on familiarizing customers or members with offerings and encouraging initial product usage.
- 90-180 Days: As the relationship progresses, customers or members might be receptive to additional products or services based on initial engagement patterns, prioritizing cross-sell strategies.
- 180+ Days: For long-term customers or members, efforts shift towards retention, deepening loyalty, and offering value-added services to enhance satisfaction and prevent churn.
Cross-Sell and Retention Opportunities
STICK insight helps identify the best times and methods to introduce additional products or services, such as:
- Early Cross-Sell Opportunities: During the first 90 days, introducing low-risk, complementary products may help solidify the relationship and reduce single-service churn.
- Tailored Promotions Based on Activity: For customers or members with high activity levels, personalized offers for related products (e.g., a savings account for frequent debit card users) can boost engagement and expand product adoption.
- Retention Campaigns for Long-Term Customers or Members: For customers or members in the 180+ day segment, loyalty programs, incentives, or exclusive offers can be effective in retaining their business and rewarding loyalty.
Data-Driven Decision Making
STICK insights inform strategic and operational decisions by helping businesses understand which products drive the most engagement and identifying patterns that indicate customer or member satisfaction or potential churn. Applications include:
- Tailoring product offerings and engagement strategies based on customer or member activity levels and preferences at each tenure stage.
- Developing targeted promotions to encourage product adoption for single-service customers or members and increase multi-product relationships.
- Allocating resources and customer or member support efforts more efficiently to prioritize high-potential households.
Applications of STICK in Marketing
STICK enhances marketing efforts and engagement in several ways:
- Lifecycle-Based Engagement Campaigns: By recognizing customer or member stages, businesses can create tailored marketing campaigns that introduce products or services aligned with each stage’s needs, such as introductory offers for new customers or members and loyalty rewards for long-term relationships.
- Cross-Sell and Up-Sell Programs: Using insights on product mix and household potential, businesses can identify prime cross-sell opportunities, crafting personalized recommendations to deepen relationships.
- Retention and Loyalty Initiatives: For long-term customers or members, STICK analysis guides loyalty and retention strategies by highlighting when and where to engage with high value offers, loyalty programs, or customer or member support to enhance satisfaction.
STICK is essential for understanding and enhancing customer engagement over time, helping businesses to provide the right products at the right times and foster long-lasting, profitable relationships. By optimizing each stage of the customer or member lifecycle, STICK plays a vital role in increasing product adoption and improving loyalty.