Data mining has been a driving force of ad placements, especially in the banking industry. While many companies focus efforts on gathering huge amounts of data for further analysis, Yodlee has already developed its own stores. With them, it has launched a new financial application called CrossSell to help banks more effectively market their relevant products to consumers.

Yodlee’s data collection has been going on for quite some time. The company powers financial transactions at eight of the top 10 financial institutions and at nearly 80 percent of the top 50. In an interview, Eric Connors, Yodlee’s Senior Vice President of Products, talked about the new application and how consumers will respond differently to new, data-targeted ads.

To summarize our conversation Connors stated, “Yodlee CrossSell is a product designed for a company with inventory to sell,” which I think is actually the perfect introduction to understanding the functions of this tool.

Accurate advertising

Financial institutions have been grappling with ways to connect to their audiences, but their efforts to target the right ads to the right people have fallen short. Instead, they tend to send annoying ads to irritated customers. This is the problem CrossSell hopes to solve. The application lets large banks run queries on their customers to see who would benefit from individual products.

“If you pay x amount for your mortgage and y for your loan, you may be the perfect candidate for a certain product from your bank while someone else may need a different one entirely,” Connors explained. “These two customers should not be viewing the same product at checkout.”

The more targeted ads will not be announced or, well, advertised, but banks hope that when you see them, they will work. They may appear as you log out of your online banking session or receive your bank statement in the mail. This will hopefully transform a useless bevy of annoying ads focused a large plurality of the population into a targeted and relevant campaign based on your personal information.

Not breaking any new ground

With CrossSell, Yodlee hopes banks will be able to target their advertisements to avoid exactly these problems. However, “data mining to determine the right products is one thing, but it all depends on whether the banks misuse it or not,” said Kathleen Day, spokeswoman for the Center for Responsible Lending. “Obviously we do not want them using our information to market worse products to us.”

In terms of whether this could be a breakthrough in targeted ads, Day said, “I’ve been hearing about similar ‘micromarketing’ advancements for decades,” as she recalled efforts by Michael Saylor to break down credit scores from 650+ as good, for example, into 25 different tranches. With consumer data, it “amazes me how much is captured and not effectively utilized.”

While Connors sees this as the future for more intuitive marketing for the banks, Day assures me that this is not the new and exciting field it appears to be. Targeted ads can certainly change consumers approach to both the ads and the products, but with all the dishonesty and corruption in banking, better ads may not sway any minds.

Banks must first overcome the notion that they are evil. Then perhaps customers will appreciate a slightly more appropriate ad after using the ATM.

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