As a Credit Union, Is Segmentation Software Worth Investing In?

If you are in an administrative position at a credit union, there are many decisions you have to make. You might agree that many of them revolve around improvising the experience that your members have with your institution. After all, one of the key selling points of credit unions over banks is their superior, personalized customer support. 

In this context, many credit unions are choosing to invest in technology that improves this aspect even more.  Customer segmentation software is one such example that you might have heard of. Is it worth looking into? Let’s find out today.

What Is Segmentation Software and Why Is it Important?

Segmentation is exactly what it sounds like. You are creating categories of data—in this context, customer data. This often includes the entire range of customer actions and behaviors. For instance, their basic demographics, their purchasing trends, their location, and more. 

Customer segmentation in banks and credit unions is extremely important. We know that quality segmentation offers greater personalization to clients, which ends up increasing customer satisfaction. 

As Lumin Digital states, banks and credit unions have been using segmentation strategies for a long time. However, because credit unions tend to be client-focused, they are more likely to invest in solutions that improve the user experience.

Such data can be used to better understand customers, their needs, and their priorities. Customer segmentation isn’t something specific to credit unions. Virtually every business today makes use of it in some shape or form to improve their service. 

One can argue that credit unions that aren’t analyzing customer data need to step up their game. Segmentation software instantly sifts through customer data and provides you with insights that your representatives can then make use of. 

Segmentation Software Allows for Targeted Marketing Campaigns

With enough insights gathered, it becomes incredibly simple to understand what a particular demographic is looking for in your location. Rather than relying on generic advertisements, you are now able to craft messages that resonate closely with the needs of your target audience. 

For instance, while it may be obvious that younger members are often focused on information related to student loans, segmentation software allows you to go deeper. For instance, you are able to understand the needs of young members who are recent graduates versus those who are early in their careers. 

Such seemingly small differences play a massive role in the effectiveness of your marketing campaigns. Likewise, rather than drawing generalizations about seniors and retirement planning, you are able to understand the varying priorities among senior members. This can include the diverse preferences they may have with real estate investment, and guidance on wills and trust. Some seniors might show great interest in travel and leisure activities and knowing how to cater to such members will be important. 

Potential Considerations for Implementing Segmenting Software

Before you choose to look into segmentation software, you do want to prepare accordingly. While many options come with promises of easy integration, there’s still some work to be done on your end. For instance, there will have to be some level of staff training in order to use the software. 

Similarly, you will have to prepare your data in such a manner that it can be imported as the software requires it. If you happened to rely on paper until now, then this will require some work. On the other hand, if you used something like Microsoft Excel, then all that you may need to do is adjust your formatting a little bit. 

Lastly, you want to ensure that you know how to use the insights that you gain. Segmentation software will provide insights, yes, but to get the best return, you need to combine it with a broader strategy. 

For instance, you will need to find ways to integrate the insights with your communication, member retention, and product/service development efforts. This will require close planning with your strategists and possibly some consulting help. 

The last thing you want is a haphazard implementation.  Without this broader integration, you waste the time of your employees and also the investment you made.

In conclusion, investing in segmentation software is very much worth it if you have a clear strategy in mind. Credit unions are customer-focused, and these solutions can considerably improve your marketing and customer service efforts. 

Yes, there will be some effort that needs to be put in with regard to employee training and data preparation, but that’s to be expected. Once you establish a proper system in place, you will soon be witnessing how transformative this type of technology can be.