September 18, 2001 - Oakbrook Terrace, IL
Raddon Financial Group (RFG) announced the addition of checking account transaction data into several of its key product lines, notably their Windows®-based MCIF system, iNTEGRATOR, and their CEO Strategies Group profitability analysis program. Additionally, a new product dedicated to the analysis of activity data was announced: the Delivery Channel Analysis Report provides an in-depth look at how consumers use an institution's delivery channels. According to Bob Lawhead, President and CEO of RFG, "Activity-based data lets us analyze an institution's customers to identify profitability, channel and product usage. Until now, this level of activity-based analysis was not widely available to financial institutions. We can show an institution how the delivery channel usage of a customer can directly reflect in the profitability of that customer."

Understanding the customer's transaction and channel activity is critical to CRM and database marketing functions. Considering each checking account has a unique cost based on the customer's delivery channel usage, and each checking account has unique non-interest income based on fee and interchange income, activity dramatically impacts profitability. The most important insights we learn from analyzing customer activity are:

•  profitability and product usage differ based on delivery channel usage,

• product design should match the customers' delivery channel preferences, and

• activity-based segmentation can improve target marketing efficiency. 

RFG collects key transaction data and specific fee income data, from which RFG can provide more accurate account and household profitability. Plus, activity data provides a unique channel user profile and activity-based segmentation to show institutions how channel usage correlates with product usage.

"Our preliminary analysis showed us how activity data can enhance an institution's management information. This data identifies the value of various delivery channels. For example, the profitability of a PC Banking household is much different than households that primarily use automated voice response or even households that primarily use ATM's" said Mark Riddle, Senior Research Analyst with RFG. 

According to Curt Johnson, Vice President of Software Development, "incorporating activity data has been a development priority for more than two years, but making this solution widely available has been difficult due to the complexity of activity data and the many data processing systems used throughout the industry. We now have the ability to deliver activity information through the strategic and tactical programs we offer to the financial industry."

"We are looking for a way to more accurately match costs and fees to account activity," says John Tippets, President and CEO of American Airlines Federal Credit Union, a Dallas based $2.7 billion credit union and RFG client. "Analyzing account activity will give us a much better feel for which members are our most profitable, which products are the income generators, and which products need to be modified" added Tippets. 

For over twenty years RFG has provided national consumer research to the financial services industry. RFG's line of research and analysis programs offer financial institutions a unique and integrated solution for gaining insightful management information. To learn more about RFG's integrated solutions, call 800.827.3500 or visit www.raddon.com

For more information contact: 
Raddon Financial Group (RFG), Oakbrook Terrace, IL 800-827-3500. 
Dan McGowan, Marketing Director, ext. 330
Bob Lawhead, President & CEO, ext. 387