BlastPoint Deep Dive Podcast

External Data_ Financial Institutions' Competitive Edge
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[00:00:00] Welcome back to the Blastpoint deep dive, everybody. We explore the power of data and AI driven solutions here. Today, we're diving into the world of Blastpoint. Blastpoint, yeah. And they're this company that's really like showing financial institutions how to like really use data, you know? Yeah. And what's really cool is they're not just talking about like crunching numbers.

They're showing you how data can like change the game for. You know, crafting strategies, understanding customers, like, even predicting future trends. Yeah, it's like not just having the data, it's like, what do you do with it? Totally. So for this deep dive You know, you give us a bunch of Blastpoint's marketing materials, like white papers, case studies, you know, the whole thing.

Wow. And our amazing team and, uh, some AI magic have, like, pulled out all the good stuff just for you. It's like having a research assistant. Yeah, but way cooler. Way cooler, right? Okay, so let's get down to it. Okay. So Blastpoint[00:01:00]

works with these banks and credit unions. Mm hmm. And they're helping them see this thing that they've been missing for years. Really? It's the power of external data. Financial institutions have always just looked at internal data, right? Things like transaction histories, loan applications, account balances.

Yeah. But that only tells part of the story. Right. It's like trying to judge a book by its cover. You're missing all the good stuff inside, right? So, like, what are we missing? Yeah, so what are we missing? What is this external data? Yeah. What is it and why is it important? Yeah. Why is it so important? Okay, so imagine you're trying to understand a customer's needs.

Right. Internal data might tell you their income or their spending habits, but external data adds all this context. Oh. It includes things like local economic trends, house [00:02:00] market shifts, even consumer behavior patterns. So instead of just seeing like a snapshot, you get the whole picture. Yes, exactly.

Blastpoint calls this creating a 360 degree member profile. 360? Yeah. It's about like piecing together a much richer understanding of their needs and like how those needs intersect with like the bigger market trends. I see. I see. So in their white paper, Blastpoint gives this really fascinating example of a credit union that wants to grow its home loan business.

Can you tell us a little bit more about that? Yeah, sure. So the credit union had all this data about its own mortgages, right? Right. But that only showed them their own trends, right? So by like adding in external data, things like housing market forecasts, income growth in like specific neighborhoods, even employment rates, they were able to see exactly where the demand for these home loans was going to go up.

So they weren't just like chasing after existing customers, they were finding like Hidden [00:03:00] opportunities. Yes. Like almost predicting the future of the housing market. Yeah, yeah. Neighborhood by neighborhood. That's amazing. Yeah. And that's just the beginning. Wow. BlastPoint says that there are four major ways that this external data can completely change a financial institution's game plan.

Okay. I'm ready. What are these four game changers? Okay. So first is identifying new market opportunities. Okay. Like we just talked about with the credit union. We're talking about seeing trends before they become mainstream. So I'm guessing this is way beyond housing. Oh, yeah. What other opportunities can this kind of data show us?

Well, think about it. Population shifts can show you areas that are ready for certain financial products. Okay. So like a ton of young professionals moving into a city. Yeah. That might mean that they need programs for first time homebuyers or student loan refinancing options. That makes sense. But on the other hand, like an aging population could mean A higher demand for like retirement planning services or wealth management solutions.

So it's like matching what you offer [00:04:00] with like who's there and what the community needs. Exactly. That's really cool. Yeah. So the second big impact is making members more engaged and making things more personalized. Personalization. Yeah, because today's customers, especially like younger generations, they expect their financial institutions to know them, understand their needs and offer solutions that fit their lifestyles because no one wants to get those generic marketing emails anymore.

No, nobody wants that. It's all about that personal touch, right? And external data makes that happen. Okay. Imagine being able to segment your audience, not just based on like age or income, but on their spending habits, life stage, even their money anxieties. So you're not just sending out a mass email about a new credit card.

Right. You could target certain customers who are actually looking for a new card. Exactly. You could even predict which features would be most appealing to them based on what they've done before. Oh, wow. It's about going from one size fits all to perfectly tailored. It's like having a financial [00:05:00] advisor who knows you inside and out.

Exactly. This is blowing my mind. What's number three? Okay, number three is about standing out from the crowd. It's called strengthening competitive positioning. Competitive positioning. Yeah, because the financial world is super competitive these days. Yeah. Everybody wants the same customer. So how does data help you win?

Well, external data can make you a leader, not a follower. Like that. It lets you anticipate market shifts before your competitors even see them coming. Oh, wow. Imagine adjusting your interest rates, or launching new products based on like real time economic data, or even seeing new competitors pop up before they become a problem.

It's like having a crystal ball. In a way, yeah. Wow. It's about going from reactive to proactive. I see. Instead of just responding to trends, you're shaping them, becoming the go to financial partner that everyone trusts. Okay, this all sounds incredible, but I bet some people are listening and thinking, hold on.

This is going to be expensive. Is it really worth it? Yeah, that's a good question. Is [00:06:00] it? But BlastPoint says that the return on investment, the ROI, from using this data strategically is incredible. Okay. Think about it. Improving your targeting means your marketing campaigns are way more effective. You're reaching the right people with the right message so you get more customers and ultimately more profits.

So it's not just a cost. It's an investment that can actually help you grow. Exactly. Okay. Let's look at an example. By using economic and employment data to assess credit, a bank can really cut down on loan defaults. Right. Imagine being able to tell how likely someone is to default on a loan based on real time economic indicators.

Wow. That's huge for managing risk and making money. So it's about making smarter choices all around. Yes. From marketing to lending, by using data as a tool for growth. You got it. It's about making data work for you. This has been so insightful. I feel like I'm finally understanding the power of data. It's exciting, isn't it?

It is. We've only just scratched the surface of what's possible. [00:07:00] And I want to dive deeper. Yes. This is where Blastpoint's white paper comes in. The Essential Guide to External Data. Yeah, it seems like everyone in finance, or even just anyone who's interested in data, should read it. Absolutely. It looks like it goes into way more detail than we have today.

Yeah. It talks about the different types of external data, the best places to get it. Okay. It even has real world examples of how companies are using this data to grow their businesses. Wow. That sounds amazing. It really is. It's like a roadmap to success in the data world. So how can our listeners get this white paper?

It's easy. You can find a link to download the white paper in the episode description. Perfect. We'll make sure to include that link. So before we move on to part two, let's just recap the key benefits of external data for financial institutions. Sounds good. Okay. So we talked about how it helps find new market opportunities.

Right. Like finding those neighborhoods with tons of potential customers or figuring out which financial products will be in high demand. Yeah. And we talked about how it makes members more engaged and things more personalized. So institutions can really focus [00:08:00] on individual needs and make better offers.

No more of those generic emails, just messages that actually matter. Right, and of course we talked about how it makes you more competitive, letting institutions stay ahead of the game and use data to make decisions that give them an edge. It's all about being proactive, not reactive, and using data to become the trusted financial partner in your community.

Exactly. And let's not forget, the bottom line, external data helps with ROI by improving, targeting, reducing risk, and making operations better overall. It's all about turning data into real results. You said it perfectly. Are you ready to go deeper into the different types of external data that are making all this happen?

I'm all in. Where do we even begin? Um, let's start with what's called demographic data. Okay. And this is basically information about, like, the characteristics of a population. You know, think about age, gender, income levels, education, even things like marital status and family size. Okay. So I [00:09:00] see how knowing that about your customer base would be helpful, right?

But how does this demographic data actually help a financial institution? Like what can they actually do with it? So imagine a credit union is looking at this data and they see there are a lot of young families in a certain neighborhood. Okay. They could use that information to, like, tailor their marketing, you know, maybe highlighting products like first time homebuyer mortgages, education savings plans, or even financial literacy programs for young parents.

So it's like you're kind of anticipating the needs of different groups of people and then creating products and services that fit those needs. Exactly. Demographic data can also help. Find markets that are being underserved underserved Yeah, for example a bank might see that the number of retirees in an area is going way up Okay, but realize that what they currently offer doesn't really meet the needs of that group.

That's a huge opportunity, right? They could totally change their products and services to attract that growing market So it's all about finding the gaps and then like filling [00:10:00] them with solutions that really work for those customers Yes, that makes a lot of sense Now let's move on to another important type of external data economic indicators.

Okay. This data gives you insights into how the economy is doing. So we're talking about things like unemployment rates, GDP growth, inflation, consumer confidence. Yeah, all those big picture things and understanding those trends can really affect how a financial institution makes decisions. For example, if a bank sees that unemployment is going up in a certain area, I think, they might be more careful about giving out loans, you know?

Yeah, it makes sense to be more cautious when things are uncertain. Right. But what if the economic indicators are good? Then what happens? Well, in a strong economy where people feel confident, a financial institution might feel better about expanding its loan portfolio, investing in new branches, or even creating new products to meet the higher demand.

So you're basically adjusting your strategies based on what's happening in the economy. Exactly. Now, you mentioned [00:11:00] another type of data. Earlier, consumer behavior data. Yes, consumer behavior data. That sounds really interesting, but also kind of personal. It is personal in a way. It tracks how people spend their money, their buying habits, what brands they like, even what they do online.

Wow, that's a lot of information. How do financial institutions even get access to all that? They can work with companies that specialize in collecting this data. These companies gather information from all sorts of places, like loyalty programs, surveys, and even social media. They can also look at their own website traffic to see what's popular.

So if a bank sees a lot of people checking out travel rewards, credit cards on their website, Uh huh. They could focus their marketing on that product. Exactly. Or, if they notice that more and more customers are using mobile banking apps, Yeah. they might invest in making their app even better. It's all about keeping up with what customers want.

This is starting to feel like the future of banking. What's the last type of external data we need to know about? The last one is business activity data. [00:12:00] Business activity. Yeah, this focuses on how businesses are doing in a specific area or industry. Okay. This includes things like their revenue growth, how many employees they have, their plans for expansion, and even how they compare to their competitors.

I can see how that would be super helpful for banks and credit unions that work with a lot of businesses. Definitely. For instance, if a bank notices that a certain industry is growing really fast in their region, they might create special loan programs or financial advisory services just for businesses in that industry.

So it's about finding growth opportunities by understanding what's going on with businesses in the area. Exactly. And by looking at competitor data, they can spot potential threats or even chances to team up with other businesses. This is all so fascinating. I'm starting to see how these different types of data work together to give you a really complete picture of the market.

That's the cool part. It's like putting together a giant puzzle. A puzzle? Yeah, when you combine all these [00:13:00] pieces, the demographics, economic indicators, consumer behavior, and business activity, along with the financial institution's own internal data, you get a 360 degree view of the entire financial landscape.

It's like connecting all the dots. Exactly, and that brings us to the really exciting part, how financial institutions are actually using all this data to do amazing things, and that's what we'll explore in part three. Okay, so we've explored, like, what external data is It's, you know, the different types and where it comes from.

Right. Now let's talk about how it's actually used. Yeah. How are financial institutions actually using this data to, you know, get things done? Yeah. What are they doing with it? Well, the ways they use it are like super diverse. Okay. But let's start with something that's really important for every financial institution.

What's that? Managing risk. Oh yeah. Risk management is huge, especially in finance. How does external data help with that? So, traditionally, when a bank looks at a loan application, they focus on the person's credit history income and debt to income ratio, [00:14:00] but by using external data, they can get a much better understanding of, like, the applicant's overall financial stability.

So instead of just looking at the past, they're kind of getting a glimpse into the future. Exactly. Imagine you're a loan officer looking at an application. Okay. You see the person has a good credit score and a steady income. Right. But then you use external data and you see that their industry is about to have a bunch of layoffs in the area.

Oh, wow. That might make you think twice about giving them a big loan, right? Yeah, that makes sense. You're not just looking at their situation, but also what's happening in the economy around them. Exactly. It's about seeing the connections between someone's personal finances and the bigger economic picture.

I see that. And you can use this approach for other risk management stuff, too. Like what? Give me an example. Think about fraud detection. Okay. By looking at patterns in consumer behavior data, financial institutions can spot weird transactions that might have slipped through the cracks. Oh, that's interesting.

Yeah, like if someone suddenly starts buying a ton of stuff outside of their [00:15:00] normal spending habits, that could mean something fishy is going on. So it's like using data to prevent problems before they even happen. Exactly. It's about being proactive, not reactive. Using data to stay ahead of the game.

Okay, so we talked about risk management. Mm hmm. What other areas are being changed by this external data? Well, one of the most exciting areas is marketing and getting new customers. Oh, yeah. Financial institutions are realizing that those generic marketing campaigns don't work anymore. Right. People want personalized experiences and data helps make that happen.

Yeah, I totally get that. I'm way more likely to pay attention to something that seems like it's for me. Exactly. With external data, financial institutions can create those super targeted marketing campaigns that reach the right people with the right message at the right time. Okay, so how would that work?

Like, give me a specific example. Let's say a credit union wants to advertise a new savings account for young adults. Okay. Using demographic data, they can find the neighborhoods where a lot of young people [00:16:00] live. Right. Then, using consumer behavior data, they can tailor their messages to talk about the features and benefits that those young people would care about.

So it's about speaking their language. Exactly. Meeting them where they are. And this data driven approach can be used to improve other parts of their business, too. Oh, really? Like what? Think about where they put their branches. Okay. Instead of just guessing or using old market research, Uh huh. financial institutions can use external data to make smart decisions about where to open new branches or even close old ones.

So they could look at things like how many people live in an area, traffic patterns, and even spending habits in different neighborhoods. Yeah, to find the best spots for a new branch. Wow, this has been such an eye opening deep dive. I'm seriously impressed by how powerful this external data is in the financial world.

It's a really exciting time to be in this field. We're seeing how data is not just changing how financial institutions work. Right. But also creating better, more personalized experiences for their customers. [00:17:00] Definitely. So before we wrap up, I want to remind everyone about BlastPoint's white paper. The Essential Guide to External Data.

Yes, it goes into so much more detail about everything we've talked about. Yeah, it's a great resource for anyone who wants to use external data to get ahead. You can find a link to download it in this episode's description, and don't forget to subscribe to The Deep Dive for more explorations into all kinds of cool topics that are shaping our world.

We'll see you next time.