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We are excited to announce the annual launch of our Global data management research! This year, we surveyed 700 business leaders across the U.S., U.K., and Brazil to get their perspective on usage of data throughout the pandemic. There’s no question that data initiatives have been on the to-do list for over a decade now, but as the pandemic came storming in, businesses quickly realized that data management never made it to the top of the list. In other words, most businesses were not prepared for the rapid transformation they needed to sustain during the global health crisis because their data, simply, was not ready. There are three major takeaways from this year’s study: An acceleration of digital transformation has made businesses reliant on high-quality data. We find that business priorities have remained the same over the last few years: Customer experience and data security. However, these initiatives are more important than ever before, especially when it comes to digital transformation. Seventy-two percent say an acceleration to digital transformation has made their business more reliant on data and data insights. Why? With dramatic changes in customer buying behaviour during the pandemic, and most employees still working remotely, digital engagement and operations have become key to sustaining business growth during economic crisis. Our research finds that seventy-five percent of respondents say they have seen a dramatic change in their customer’s buying behavior during the pandemic. With stores closed, overwhelmed distribution and shipping warehouses, and unpredictable supply chains (bread flour, anyone?) …businesses need to leverage online platforms, like their website and social media, to stay engaged with customers. Nowadays, it’s not unusual for a brand’s customer experience to be solely digital. Furthermore, with increased online activity and non-essential employees working from home, there’s a chance consumer or operational data could be at higher risk of unwanted actions or unauthorized users. This is where data security plays an important role in keeping records, and the business, safe. From the efficiency of the customer experience online to the data that helps us analyze markets and attitudes changing at a dizzying pace…the right data has become indispensable. The need for a data-driven digital operation and customer experience has made companies realize how mature their data functions are, or where there is opportunity for improvement. Data was not ready to sustain the impact of the pandemic. For many years, we have looked at the maturity level of data quality in the market. Our hope was that this maturity level had increased to handle the new demands and desire for insight. Unfortunately for many, levels of quality data continued to fall short. Fifty-five percent of business leaders say they lack trust in their data assets, hindering their ability to be fully data driven. The level of inaccurate data has remained high over the past five years of this study. Organizations believe about a third of their customer and prospect data is inaccurate in some way. Additionally, only fifty percent believe their CRM/ERP data is clean and can be fully leveraged. Poor data quality creates several roadblocks within organizations, regardless of their maturity. While data can be inaccurate for a wide variety of reasons, such as human error or natural data decay, the impact is the same. Ninety-five percent of businesses have seen impacts related to poor data quality. This could mean that poor quality data damages the reliability of analytics (36%), negatively affects customer experience (32%), and negatively impacts reputation and customer trust (32%). These challenges are difficult to overcome in any economy, especially one facing a pandemic. Another challenging area is the inability to be agile with data. While eighty-four percent of respondents experienced greater demand for data insights, sixty-two percent admit a lack of agility in data processes hurt their response to changing business needs. Ensuring high-quality data and agility within data practices is vital to improve customer experience, streamline operations, and accelerate digital transformation. By investing in data management now, businesses can sustain success despite any future market changes that are out of their control. Investing in data now will help businesses weather the next crisis. Over the next six months, sixty-three percent of organizations see data management initiatives becoming more urgent—and the reason is resilience. Nine out of ten businesses are focused on improving data management resilience to at least some degree over the next year. Businesses are investing in several key areas of data management like improving data quality, refining data governance, moving data to the cloud, and automating data processes. With over three quarters of our respondents saying, “investing in data management initiatives today will help businesses better weather the next crisis,” organizations across industries are hopping onto the data train. This means that businesses need the right: People Processes Technology It’s important for companies to invest in the right areas of data today to recognize return on investment more quickly, build data resilience, and secure their future. During the pandemic, businesses continue to struggle with a lack of technology, data quality, and skills. Data validation software verifies data at the point of capture and can automate the data cleansing process, ensuring data pipelines are accurate and contain valuable insights. This will enable team members to analyze and manage valid data and streamline their time to focus on growth-building strategies. The right people, processes, and tools will not only help a business respond to the challenges they face in today’s environment, but also ensure a stable foundation. Now, more than ever before, have we seen the true power of data. With reliable insights, businesses have the strength to confidently pivot strategies as market shifts arise, sustain the impact of the global health crisis, and prepare for what’s ahead. Read the full report to learn how what you can do today to leverage data to respond to the current global health crisis and prepare for tomorrow. Download the research.
As businesses across the globe have started to see their operations stabilize, they will be tested once again as the world faces another resurgence of the Covid-19 but this time consumer expectations will be much higher. According to the latest Experian’s Global Insights Report, 60% of consumers have higher expectations of their digital experience than before Covid-19. The study which surveyed 3,000 consumers and 900 businesses in 10 countries, including: Australia, Brazil, France, Germany, India, Japan, Singapore, Spain, the United Kingdom and the United States, found that while many consumers may have stayed loyal to businesses they frequented before COVID-19 initially, that may no longer be the case. High expectations for security and convenience compounded by the increased demand for online payments, banking and shopping are pushing businesses to re-imagine the customer journey and the investments needed to drive future growth. In fact, the study found that one in three consumers are only willing to wait 30 seconds or less before abandoning an online transaction, specifically when accessing their financial accounts. This means that businesses have an increasingly short time frame to prove the experience will be safe and convenient. Businesses have no choice but to invest in their digital presence and experience. We believe the cost of doing nothing will be greater than what it will cost to invest in the customer journey. While half of the businesses we surveyed have either mostly or completely resumed operations since Covid-19 began, only 24% are deliberately making changes to their digital customer journey. This is not enough. The integration of data, analytics and technology is the key to enable businesses to quickly adapt decisioning strategies to minimize risk, preserve valuable relationship and remain fair and compliant. In order to strengthen digital transformation, Experian recommends that retail banks, payment providers and retailers consider the following: Understanding the customer Businesses need to understand their customers more than ever before. They need to understand their behaviors, preferences, and financial situation. Each transaction creates hundreds of different touchpoints that financial institutions and retailers need to accommodate across all devices. The tricky part is using the right technology to put all the datapoints together and to link them into one single-view of the customer. Use of AI to improve and automate customer decisions Being able to make the right decision is more important than ever. Today’s economic conditions are unprecedented, and unfortunately we don’t have historic data to count on. Therefore, we need to use data and technology better than before. In the area of artificial intelligence, businesses are strengthening the security of mobile and digital channels, new credit risk analytics and artificial intelligence (AI) models and increasing digital customer acquisition and engagement. Strengthening security of mobile and digital channels Businesses need to provide not only a convenient experience but also a secure one. In order to improve security, businesses need to use a multi-level approach where they can easily access and layer fraud solutions to catch more fraud and reduce friction for genuine consumers. Discover more insights from our longitudinal study of the impact of Covid-19 on businesses and consumers.
The COVID-19 pandemic reshaped Americans’ personal and financial lives. If you find yourself in a situation that could make fulfilling your credit card, loan, or mortgage payments challenging, you may be wondering what relief options are available to help navigate these changes. The good news is there are options if you need financial support during this time. However, it can be difficult to know where to start. The two primary relief avenues are deferment and forbearance. While different in practice, these terms are often used synonymously, even by those within the credit industry. While similar at first glance, there are significant differences between forbearance and deferment agreements. While both are intended to pause or reduce payments for a certain period, there are variances when it comes to how you must repay the delayed payments. It’s important to understand how these two options work when speaking with your lender, so you can choose the best path for your personal financial situation. Whichever avenue you take, remember that deferment and forbearance are both temporary measures and shouldn’t be used as permanent solutions. Pausing Payments with Deferments You may have seen the term deferment in the news more recently with mortgage relief and student loan deferral options. So, what exactly is deferment? Through this option payments are put on pause and deferred until a later date. This is a longer-term strategy that enables you to pay back your loan over time, when your financial situation puts you in a position to do so responsibly. Interest can sometimes accrue during a deferment period, depending on the type of loan and the lender you’re working with, so it is important to talk with your lender to fully understand your agreement terms. Periods of deferment vary in length – in some cases lasting as long as your financial situation requires. You should opt for deferment if your financial situation or an unexpected event, such as being let go from your job, creates an undue burden that makes it impractical or impossible to keep up with regular payments. Temporary Relief with Forbearance The other option to discuss with your lender is forbearance. Whereas deferment allows you to pay back a loan over time, forbearance is a relief strategy that typically requires the borrower to pay a lump sum and accrued interest at the end of the forbearance period. For example, if you paused payments for five months, at the end of those five months, you would pay your lender the total of paused payments and the accrued interest. If you’re seeking forbearance for federal student loans, there are two different types of forbearance: mandatory and discretionary. With mandatory forbearance, lenders are required to pause payments if a borrower meets a set of financial criteria that could prevent them from making payments on time. Eligibility for mandatory forbearance includes: enrolment in a medical or dental residency program, payments on your federal student loans being greater than 20% of your total monthly gross income, and other circumstances that could hinder your ability to make payments. Confirm whether you’re eligible with your lender. Discretionary forbearance means the lender makes the decision at their discretion to put payments in forbearance based on your unique financial situation. Forbearance is generally a shorter-term option and the avenue to take if you don’t qualify for deferment. Consider forbearance in times of true financial crises, such as an unexpected medical bill, that would temporarily inhibit you from making a monthly payment. How to Work with Your Lender on Relief Options While discussing these options with your lender, it is critical to have a full understanding of what the agreement will entail – from interest rates to your timeline for payment – to ensure you’re in the best position to fulfill the agreement with your lenders once your payments resume.
While consumers throughout the U.S. continue to manage the impacts of COVID-19, aside from health and wellbeing, one of the most salient concerns has been around the health of consumers’ finances. With many falling under some form of stay-at-home order since the onset of the pandemic, local economies have been jolted and some consumers may be feeling the financial impacts. As part of Experian’s commitment to improve the financial health of Americans and educate on debt and credit, we focused our research efforts to analyze internal and external data to show how consumer finances have changed in recent months. Through our initial review, we found that certain measures of consumer finances, on average, had improved since the onset of the pandemic. Whether due to the unprecedented government stimulus, or changes in spending, consumers saw a reduction in average debt and increased average credit scores. Though the data is rapidly changing and the true financial implications of the pandemic may be partially obscured by governmental stimulus efforts, we wanted to take a snapshot and highlight how consumers are faring in the moment. By providing these insights, we can use data for good, helping organizations, experts, and others apply learnings that may positively guide efforts in the future for the benefit of all. Our Main Findings from January 2020 to May 2020: The average VantageScore has increased by 5 points Total average consumer debt total declined by 1% Average consumer credit card balances have decreased by 14% The average credit utilization ratio has dropped 5 percentage points These findings offer an important snapshot of consumers five-months into the COVID-19 pandemic stay-at-home orders. Though initially positive, we want to keep an eye on these trends as they could change over time as government policies and stimulus efforts are amended to adjust to future conditions. To continue providing relevant insights on prevailing trends in consumer finances, we will work to maintain updated research content as the data become available. You can find links to our most recent research below, and check back at Experian.com/research for updated articles over the coming weeks. Our Most Recent Research Articles: COVID-19 Impact: Changes to Consumer Debt and Credit COVID-19: Consumers Reduce Overall Debt During Pandemic COVID-19: Credit Utilization Drops as Consumers Cut Spending
As I reflect on the impact COVID-19 has had on my work and family life, I’m reminded of the things I once took for granted. My day-to-day routine has evolved into one of working from home, helping to take care of my toddler, and at times, doing so while on conference calls, sorting out the next grocery delivery, and writing this blog. While it’s a challenge, I’ve come to appreciate and value many of the things I’ve once taken for granted. But I also understand, I’m not the only person experiencing change. Across the globe, lives have been upended. The impact of the COVID-19 outbreak has been far-reaching and felt by hundreds of millions of people; whether due to family members that have fallen ill, job loss, shortened working hours or their children out of school. COVID-19 is an existential challenge that no one industry or entity can single-handedly address; we all need to play our part. Some companies, such as Fanatics, Ford, General Motors and Tesla, have shifted production efforts to focus on manufacturing medical resources, including personal protective equipment and ventilators. Others are donating free meals and resources to help consumers across the globe manage during this unprecedented time. Much like these organizations, Experian is committed to helping consumers and businesses navigate our current environment. We’ve expanded our financial education programming with the goal of helping consumers maintain good credit and protect their financial health. We’ve also offered small businesses free access to their Experian business credit report to help them better gauge their financial options and understand what capital is available to them. But as the world continues to combat the pandemic, we, like others, must look for new and additional ways to help. As essential organizations extend outreach efforts for those impacted by the outbreak, we believe data and technology can help them identify the groups that are most at-risk. With finite resources and limited bandwidth, it’s important for these organizations to communicate with at-risk populations and provide essential products and services as quickly as possible. With this urgency in mind, Experian developed At-Risk audience segments, which it is making available free of charge to essential organizations, such as government agencies, healthcare providers and non-governmental organizations, to help combat the fallout of the COVID-19 outbreak. The segments are built in a privacy-compliant manner and provide insights to help essential organizations reach those most in need. Organizations can use the information to determine where to allocate emergency funds, as well as redirect healthcare resources. Because the situation associated with the pandemic is changing seemingly every day and is impacting individuals in different ways and times, we also instituted a daily survey of the general population to gain insights around shifting consumer sentiment as a result of COVID-19. The insights from the survey will help organizations understand consumer sentiment during this difficult time and begin the process to identify at-risk populations. As of April 8, 2020, the survey found that: 73 percent of Baby Boomers are concerned about visiting the doctor and/or would hold off seeking care. 60 percent of Americans are concerned about filling prescriptions and/or accessing healthcare resources. 64 percent of Americans are concerned about their ability to access food and other essentials. COVID-19 has impacted consumers and businesses across the globe. As we all adapt to the new environment, we need to work together and collaborate to find ways to combat the fallout. Experian will not be stopping here, and we are committed to developing new ways to use our resources, data, technology, and creativity to help be part of the solution.
The following is written by Mike Kilander, Global Managing Director, Data Quality, at Experian With companies facing increasingly complex data challenges that can determine the success or failure of their business, never has it been so important to have accurate and reliable data. Businesses encounter almost continuous disruption – frequently driven by accelerated data insights – and increasing regulatory pressure to improve transparency and ensure consumer privacy. Moreover, the modern consumer brings online expectations and digital demands, requiring companies to respond ever faster and more than before. One-to-one marketing has become the new digital experience. To handle these new digital demands and market pressure, organizations must improve their ability to leverage their data and gather key insights, especially on their ever-changing customers. But while there is more information available than ever before, data is a largely untapped resource. Why are we drowning in data, yet starved for insight? There are two key areas where organizations are struggling: developing trust in the accuracy of their data and gaining access to it. Organizations told us they suspect almost a third of their data is inaccurate, which limits their ability to leverage data to drive improved business outcomes. If you can’t trust your information, how are you supposed to make big strategic business decisions with it. Second, the average business user can’t get timely access to the data or insight they need. In fact, 70% say that not having direct control over data impacts their ability to meet strategic objectives. Too often, access to data only comes after the submission of an IT ticket and weeks of waiting. We see, year after year, many businesses fail to take full advantage of the opportunity their data. Current infrastructure and management practices are often not set up to handle today’s digital consumer, the volume of data generated, and the multitude of systems collecting the data, leaving users with inaccurate data and limited access. Consequently, they have been limited in their ability to leverage new data talent, technology, and best practices that can help them gain the necessary insight to innovate and stay competitive. In the past several years managing data became more complicated because of the increasingly diverse group of stakeholders who want to leverage and have access to data. It isn’t enough now just to make sure the data is right, which most companies still have not cracked. Now you also must make sure that insight is provided with the right context, to the right business user who can make the most effective decisions for the organization. These challenges will only become more acute as organizations not only continue to delay meaningful investment in data management, but also miss the emerging trend of democratization of data control in the organization. When investing in technology, few stop to think about the overarching operational data strategy and how decentralized data manipulation has become. Organizations need the right ownership or strong data leadership that allows them to access data and take advantage of insight, while considering consumer privacy, data security and data governance. Experian just released a new report looking at customer experience data trends, developing trust in information and changing data ownership. I encourage you to read this new report in the hopes that it will shed light into best practices around leveraging data. Download the new 2019 Global Data Management report here.
Digital commerce has changed the way consumers interact with businesses. More people are transacting online versus going into retail stores, and more than half of banking is done via mobile channels. Yet both businesses and consumers still want convenience and security, without increased fraud risk. And as interactions have become more anonymous in an online space, trust is based on businesses protecting consumers from fraud while still providing a great customer experience. So, what does it take to build trusted relationships online? New research from our 2019 Global Identity and Fraud Report shows that 74% of consumers see security as the most important element of their online experience, followed by convenience. In the past, businesses have often invested in one at the expense of the other, and our research suggests that consumers can expect both security and convenience without the trade-off. The availability of information consumers share with businesses make this possible, and consumers are willing to share more personal information if they believe it means greater online security and convenience. In fact, our research found that 70 percent of consumers are willing to share more personal data, particularly when they see a benefit. However, this value exchange of more personal information for a better online experience is the same information that puts consumers at a greater risk for fraud. Instead, businesses need to demand more from the information they already have access to and use more sophisticated authentication strategies and advanced technologies to better identify their customers and deliver tailored, streamlined experiences without increasing their risk exposure. Findings from the study reveal that consumers and business leaders agree that security methods enabled by new technologies and advanced authentication methods instill online trust. In fact, consumer confidence grew from 43 percent to 74 percent when physical biometrics was used to protect their accounts. The report also found that businesses are beginning to embrace the changing technology, while half of organizations globally reported an increase in their fraud management budget over the past twelve months. And lastly, the report looked at transparency and how that impacts consumer trust. In order to create even more trust online, many businesses are proactively sharing with customers how they use their personal information. The report found that nearly 80 percent of consumers say the more transparent a business is about the use of their information, the greater trust they have in that business. And the good news is that 56 percent of businesses plan to invest more in transparency-inspired programs such as – consumer education, communicating terms more concisely, and helping consumers feel in control of their personal data. Fraud remains a constant threat and it should come as no surprise that nearly 60 percent of consumers worldwide have experienced online fraud at some point. However, both business and consumers are getting smarter about how they manage fraud and it comes down to the important theme of trust. In order for consumers to trust businesses, they need to feel secure. And by adopting better security measures, businesses can embrace the important role of protecting customers and giving them the experience they want and deserve. Download the new Experian 2019 Fraud & Identity report here.
In our increasingly digital world, there’s a growing expectation among consumers to only receive personal and relevant content from brands.
According to a recent Experian survey among 500 child identity theft victims who are now adults, one in four survey respondents are still dealing with issues more than 10 years after the fact, and 35% have sought professional help in dealing with related stress, anxiety, anger or depression related to the theft.