Data Mining to Identify New Markets (1,176 words)
"We did a three-year build on the file to reveal a potential field of 2.7 million in the geographic area. This included a combined 40 school districts in the 10-county Dallas area," he says.
The DTCU was granted its new charter on June 1 of this year.
Mapping Its Members
Geographic analysis of its data warehouse has been instrumental in helping DTCU in other ways, for instance to visually represent its member base within the surrounding communities. "The most exciting thing about all this is we can take the top 10 percent most profitable members and spatially map them across the field of the membership area," Thompson explains, adding "this is where the money comes from. These are the branches, the ATMs, they use."
Another interesting fact the DTCU learned is that it has almost 100-percent checking account penetration within a seven-minute drive of branch location. "Then it drops off dramatically. The real interesting thing here is that it's based on time, not distance. It shows that people want to be near a branch—whether they visit it or not. This is the reason the dot-coms are having so much trouble," asserts Thompson.
He adds, "Now we've taken this, overlayed it with Acxiom data and profiled with lifestyles, and Acxiom gives us back these clusters so we can decide where to build future branches."
As its member base grows, the Dallas Teachers Credit Union averages two new locations per year. More factors come into play than just the number of members when building a new branch. Sometimes the new branch needs to alleviate high traffic at an existing branch.
"We just opened a new branch in a suburb that is relatively close to a branch that was overloaded," Thompson says. "We wanted the drainoff."
By mining the data in its warehouse, DTCU was also able to learn some interesting things about its existing customers, such as the predictability of bankruptcies. "We looked at the data warehouse to find what about bankruptcies was predictive and then could track those individuals more closely," Thompson explains. This is important, since part of DTCU's charter as a credit union is to serve the community.