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3 Smart Ways for Credit to Segment Customers

How Can Finance Rethink Customer Data Management?

When customer data becomes unwieldy, we need an organized approach to reining it in.

Enter segmentation.

For finance and credit teams, segmentation enables the financial manager to step back from individual transactional line items and analyze one account in the context of the entire portfolio. Here's how.

1. Proactively Perform Account Reviews

For credit teams today, deteriorating customer credit levels is a top challenge. Many companies perform account reviews based on sales channels. Segmenting by industries and corporate family trees can also provide insight into risk factors.

And don't forget that you're not just looking for the negative; upsell and cross-sell opportunities arise during this process.

2. Collaborate with Sales and Marketing

As you start the segmentation process, you're drilling into what sales reps are most concerned about. What anomalies present themselves? What behavior trends? Which accounts are under-utilizing credit limits and therefore are low-risk targets? Answering these questions tells you a lot about your portfolio - and sharing the insights with sales lets you build what's probably the most critical cross-functional relationship for driving growth.

3. Manage Risk Strategically

A company may have a decent number of strategic accounts it deems most important. Oftentimes, however, those accounts prove to be the worst payers. Because the dollars are so heavily weighted in their favor, they dwarf anything coming beneath them. They're big, so they can often dictate terms. The point is segmentation is important in determining the payment behaviors of customers and vendors, because you can identify interesting behavior patterns that you just might be able to leverage.

Perfect your portfolio perspective

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