How To Use Behavioral Data To Close More Loans

You know your customers well. However, customer behavior isn’t static. Sentiments change over time and events like the COVID-19 pandemic can cause major shifts in behavior overnight. You may understand your customers today — but will you fully grasp their needs tomorrow?

These days, businesses need to be able to adjust and re-optimize their customer experience as needed, and lenders are no different. Behavioral analytics solutions give you power to see exactly what your customers are doing when they interact with your business in a digital environment. Data-driven insights allow you to meet your customers’ needs exactly, even if those needs change frequently. Keep reading to learn more about the value you can derive from behavioral analytics.

Build evolving customer personas

In the past, customer behaviors changed slowly. Significant shifts in consumer patterns happened over decades or even over generations. According to McKinsey & Company, the COVID-19 pandemic resulted in much more rapid and widespread alteration of consumer behavior. Between April and July 2020, 75% of consumers tried a new store, brand, or way of shopping. For lenders, this trend translates to higher numbers of digital mortgages.

Prior to the pandemic, businesses could create buyer personas and rely on them for years. That’s no longer true. Now, businesses need to constantly reassess customer needs and behaviors. Real-time analytics enable you to update your buyer personas frequently so you can be sure you’re always acting on the most up-to-date and relevant information.

Remove any obstacles in the customer journey

Online applications have become the norm. As such, making every online interaction as smooth and seamless as possible will enable you to close more loans. 

Specifically, behavioral data analysis can show lenders where customers are getting stuck in the process. This could be something simple, such as a set of instructions that could be worded more clearly. Or, it could indicate a staffing issue, such as when there aren’t enough loan officers available to answer customer questions in a timely manner.

Once you’ve identified friction within the customer journey, you can take steps to help borrowers have a better experience.

Make conversion predictions

Each click borrowers make generates data. Given enough information, you can use your findings to make predictions about future customer interactions. Utilizing big data analytics, you can get a better understanding of which customers are most likely to convert to closed loans.

For example, let’s say that the data shows that customers who chat with a loan officer are 50% more likely to convert to a closed loan. Based on that finding, you might create a prompt encouraging new customers to chat with a loan officer as soon as they arrive on your website. 

Increase customer lifetime value

With a deep understanding of the borrower journey, you can fine-tune each step between attracting potential customers and closing loans. In addition, lessons gleaned from behavioral analytics can help you keep your customers happy over the long term. 

A first-time mortgage customer might be interested in other financial services and products months or years down the line. Analytics will help you understand when to approach each customer with new offers, increasing their lifetime value to your organization.

And as you retain existing customers, you likewise increase your chances of generating new referrals from those same satisfied customers. The cumulative effect, then, can totally reshape the future trajectory of your business.

Want to close more loans? Get in touch with Roostify today.