Download the PDF Version

The Company

RBC Centura is the personal and commercial banking operation in the U.S. for the RBC Financial Group family of companies. RBC Centura delivers a wide range of financial products including deposit accounts, investments and mutual funds, financial advice, credit and debit cards, business and personal loans, insurance, and residential and commercial mortgages through RBC Centura Bank and other RBC companies throughout North America.

RBC Centura serves personal and commercial customers through more than 260 retail and business banking centers in five South Eastern states, concentrated primarily in North Carolina. RBC Centura is also a leader in e-commerce, offering a number of services delivered over the Internet.

The Challenge

RBCC needed to improve the likelihood of a customer qualifying for a loan.

Every year, RBC Centura updates its demographic information on its retail clients.

"Our hope," said Norman Glessner, Senior Manager, Customer Data Management at RBCC, "was to look at all the different characteristics of responders and non-responders from past campaigns and get as many data points as possible."

Glessner said he needed to outsource to a reliable company that could provide a vital supply of accurate information.

"We needed help to pick good targets for the future." he said. "We want to get everyone, as much as possible, fully banked with us."

Glessner said the end-user of this information is his sales force, and nothing makes them cringe more than calling someone to discuss a loan, then finding out that person won't qualify. RBCC wanted to improve the likelihood of a target qualifying for a loan.

"We have some understanding already internally," he said of prospects that do business with RBCC. "We already know they have a loan and pay on time with us but we don't know if they are slow elsewhere. In many cases, we have nothing to hang our hat on."

This challenge is made more difficult by the fact that if RBCC pulls a credit report on a person, based on stated criteria, it is then obliged to make an offer. Plus, accessing credit bureau information is costly, and Glessner's goal was to improve the quality of information while reducing expenses.

Glessner didn't want his sales force to expend any more time than necessary. He wanted a solution that was affordable—one that would not require him to make an offer of credit yet wouldn't constrain his message. "We are constantly trying to improve the leads that go out into the field to the sales force," he said.

The Solution

For a data solution that would enable RBCC to identify consumers at specific levels of creditworthiness within the RBCC database, Glessner turned to Sandy Hurst, Vice President of Sales at Acxiom.

The solution she proposed was their Real Insights Risk Assessment Tool, designed to help clients target segments of the population at varying levels of credit-worthiness.

Actual financial transactional data of hundreds of millions of consumers are aggregated at a zip+4 level. This tool uses a statistically derived scoring system to identify performance within a geographic area based on historical patterns of credit usage and payment behavior. The score is derived from such powerful predictors as mortgage, retail and credit card debt, and other tradeline information.

Real Insights uses a scoring system of 1-199 with the highest risk segments of the population falling at the bottom of the scale and the lowest risk consumers at the top. The risk scores are converted to an industry-like range of 450 to 850 to help customers more easily identify the particular segments they need.

RBCC Evaluates the Solution

RBCC typically purchases Beacon scores for all its active consumer loans and lines of credit on a regular, periodic basis for portfolio management purposes.

RBCC submitted its client list for appending demographic data including Real Insights Risk Assessment score. It sent client name and address (not account name and address) without social security numbers although RBCC does ascribe a social security number.

For evaluation purposes, RBCC isolated consumer loan social security numbers with Beacon scores purchased at roughly the same time that the Real Insights Risk Assessment Tool was applied. RBCC's task was further complicated by the fact that there is often more than one borrower on a file, and one borrower may be a far better prospect than the other, but which one? Looking only at a file, rather than individual borrowers, wasn't ideal.

RBCC isolated the Real Insights Risk Assessment scores and the client social security numbers associated with them. The two were merged on social security number and a random sample of the matched Beacon and Real Insights Risk Assessment pairs were selected. For each pair, the client calculated the difference between the scores by subtracting the Beacon score from the Real Insights Risk Assessment score. If the Risk score was 700 and the Beacon was 704, the delta would have been minus 4.

RBCC sorted these pairs by Real Insights Risk Assessment in descending order (highest scores at the top, and lowest at the bottom) and created 25 nearly equal groups. Each group has about 5,100 paired Real Insights Risk Assessment and Beacon scores: the best Risk scores in the top group, the worst in the bottom group.

The client averaged both the scores and the delta values in each group. Glessner stated, "It made sense that the delta averages are higher as you go up and lower as you go down because of the top and bottom limits. There are no opportunities for high negative variance and many opportunities for high positive variance in the top group. The opposite is also true in the bottom group, and the middle groups have nearly equal opportunities in both directions."

The average Real Insights Risk Assessment score was forced to descend by the sort imposed on the file of pairs. The paired Beacon averages could have gone any direction but, in fact, they actually descended.

"From my standpoint," said Glessner, "I can use Real Insights Risk Assessment as another factor to target a list. I know that other variables—age, income, presence of children, lifestyle, etc.—are not perfect, but we use them all the time. Often, we don't want to make hard offers of credit. We just want to generate lobby traffic or warm up a phone contact with direct mail. Anything we can do to improve credit-worthiness of a list, without the cost of involving a credit bureau, has value."

The Results

Glessner said the Real Insights Risk Assessment Tool was exactly what he needed. The score improved his results significantly and gave RBCC the ability to make more informed decisions.

“I would come back to [Acxiom] as they improved my ability to narrow down my list to better responders,” he said.

He said RBC Centura will begin incorporating Real Insights Risk Assessment scores into lists segmented for Invitation to Apply Campaigns. These are campaigns where RBCC doesn’t want to make firm offers of credit but instead wants to generate interest. By using Real Insights Risk Assessment, the credit-worthiness of RBCC’s prospect list is significantly improved without the cost of securing credit bureau information.

“This score really does lift [Acxiom] and put them above the next guy,” he said.

The Acxiom Team Helps You Grow Your Business

At Acxiom, we help companies increase their market share and create enduring customer loyalty.  Whether your order is $20 or $25,000 we will help you create the best marketing plan to generate new leads and grow your business.

Our knowledge of the direct marketing industry and the unparalleled quality of Acxiom data is the combination that leads to your success.  Our dedicated account team will work with you to make your job easier.   We know you’re busy enough doing your job.  Rely on us to do ours, and see the results.

Call us for a free consultation 866-977-6018
8:00 – 6:00 ET Monday through Friday

Email us any time with your questions:
IBLExpress@acxiom.com

To order Acxiom mailing lists online, go to:
www.mymailingleads.com

Return to Index