by: Kesna Lawrence
Gone are the days when marketing campaigns were carried out without researching the target audience in advance—the old-school “shotgun” approach. In this era of tight marketing budgets and specialized competition, targeted marketing, which offers maximum bang for your buck, is key. But for targeted marketing to work, you have to be able to determine in advance those who are both interested in, and qualify for, your offer. This requires the collecting of customer information, which, however necessary, raises legitimate privacy concerns.Through the use of third-party data providers, however, you can procure the data you need in order to prescreen customers while remaining fully compliant with legal and ethical requirements. Here’s how it works.
Understanding Permissible Purpose
In order for financial marketers to properly prescreen potential customers, they need to be able to access financial data. It’s equally important that this data be obtained in an ethical manner, without impinging upon consumer privacy. Through the provisions of the Fair Credit Reporting Act, the federal government regulates this access to credit information.
The key principle involved is “permissible purpose”: in order to access customer data, a financial institution (FI) needs to have legally acceptable grounds for doing so. For example, the need to determine if a customer qualifies for a particular product and the need to set interest rates for both consumers and products are both legally permissible reasons for accessing consumer data.
Editors Note: You can learn more about Demystifying Prescreened Offers in Vicky Hendrickson’s blog from earlier this year.continue reading »