Single Service Households

If you have spent the time to read a prior article on Service Per Household you will find a case study that notes it is not prudent to use the measurement of SPH to drive your institution. However by collecting this data there is a portion of the information that is extremely important to all institutions.

Single Service Households or those clients that only have one product type with you have a more likely chance to leave your organization.  So likely that a single service client has an 80% more likely chance of leaving your institution within the first 12 months.  It is very important to begin an engagement program as soon as possible.

However before we get to marketing programs let us first work to determine what percentage of clients you have that are single service.

Most if not all MCIF systems will have built in reporting tools that will extract this data quickly and efficiently.  If you know how build it, and more importantly building in a batch function that will allow you to obtain the data each month, go for it.  But if not my suggestion is to contact your vendor or read your manual.  The best results will be by company and then by branch, then the most important, monthly trends along with branch ranking.  Each of these will serve a very important role in your analysis.

As a NOTE: If you are proficient with your MCIF you should run some preliminary cleansing filters prior to finishing the output.  I have learned from experience that data is never clean and if you are going to obtain accurate information sometimes you must dig deep to understand what is being provided and even if it is correct.  

Take for instance single service households that just look odd.  Review those products that must have an association with another just to be legitimate.  For example: Single Service Bill Pay, Internet Banking, an ATM or Debit Card.  Each of these must have an association with another account and if they are not then some type of anomaly has occurred.

Run a simple household report extracting these very products and services by household where total services = 1 and service type = any of the above.  What are the counts? Try to determine how this could have occurred.  For us this was a normal occurrence and here is why.

Say a spouse comes in and changes the address on several accounts.  If there are two names on the account on of the individuals has authority to make the change.  As for these other types of accounts ATM, Debit, etc., they are owned by a single individual and federal regulations require a signature of the change for each. .  Was a signature card ever given?  Was one given but never returned?  These two scenarios result in all other information being changed with the exception of the other spouses because of the lack of a signature.  The next time you update your MCIF the addresses will not match and a new household is created for the orphaned account, making it a new single service household.

Anomalies will occur and they need to be fixed, however they will continually plague you data.   Make your group aware of the issues, and then move on.  The best resolution is to exclude these from your data.  Add this exclusion criteria in your batch.

Once the data is available you may find some very staggering results.  I've heard of organizations with single service households compiling more than 60% of their over all client base.  Going back to what I noted earlier that single service households have an 80% greater chance in leaving your organization within the first 12 months.  Unless you just love to do nothing but acquiring accounts getting a handle on this number by branch will be extremely important.

I'd say the average should be from 40% to 50%, however with a concentrated effort over years that number can come down.  With my prior employer we had managed to get that number in the low to upper 20's.

So how do you go about fighting these numbers?  First clean up your messes and second begin a sales culture that requires associates to ask for the business.  Third as a marketer that owns an MCIF system simple mailings to new and existing clients on an array of your product offerings will get the ball rolling.

I would suggest you build reports and begin sales initiatives that look at SS households with checking.  These should be offered, ATM or Debit Cards, or even Internet Banking or Bill Pay.  These may not produce revenue for your organization, however it will produce a sticky value that will retain that customer longer.

New households no matter if they are single service or not should always be contacted to increase cross-sell.  If you own a Matrix Mailing component make sure you set this tool up to monthly or quarterly contact your single service clients.

If you are diligent over time these numbers will come down and your associates will begin to understand their work will become easier.    

Once you have a year or so under your belt, trend results hopefully will see improvements.  Ranking branches can be very important to determine those locations that have issues.  Take the bottom 25% and dig into the data more.  See why there are issue.  One of the best ways to analysis your branch network is by observation.  Hang out at the branch, watch the interaction, see if other services are offered to the client, help where you can.  If you can bring the bottom 25% up your averages will climb at a good pace.

Good luck!

If you have additional questions about this or any other topic please send me an e-mail or leave a comment below