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Credit bureau associates are working closely with Total System Services Inc., the second-largest card processing company, in a bankruptcy-fighting effort that integrates the credit bureau's Bankruptcy Navigator account-management tool with Total's data-processing systems. The Navigator provides monthly updates of bankruptcy predictions with 24-month forecasts for up to 231 statistical areas in the U.S.
Its data can now be fed directly into the TSYS General Cardholder and TS2 card processing systems. Meanwhile, Experian last year acquired Direct Marketing Technology Inc., which operates out of a recently built regional headquarters for Experian in the Chicago suburb of Schaumburg, Ill. Experian Chairman and Chief Executive D. Van Skilling says it has become crucial for credit-reporting agencies to provide comprehensive services in credit-reporting, risk-scoring, and database marketing. "Direct Tech not only has vital capabilities in list processing and customer database management, but also brings expertise in the catalog, retail, and high-technology markets," Skilling says.
Tom Newkirk, chairman of Direct Tech, adds that "combining Direct Tech's list processing, database management, and analytical services with Experian's proprietary databases will make us a formidable force in the direct-marketing industry." The company also is building on the expertise of its European operations based in Nottingham, England. One of the fortes Nottingham offers is more experience than Experian's U.S. operations in working with marketing database services. Experian's North American operations are divided into four divisions that break down information services into the categories of real estate, direct-marketing, credit-reporting, and risk-scoring services.
"Direct-marketing people need the right information at the right moment of time," says Margaret "Peg" Smith, co-president of Experian's Strategic Solutions Division. "For a long time, Experian and other agencies have been in the business of providing data content, and Experian is trying to transform that data into intelligence to make decisions. So whether you're targeting a direct-mail piece or doing account management on a portfolio, you've transformed data into knowledge for solving problems."
A plus Direct Tech brings to Experian is its strength in serving both credit card issuers and catalogue companies. For instance, Experian and Direct Tech have developed a new a marketing tool, DT-ABC, that scores and segments consumers targeted in direct-mail campaigns by their expected level of response.
The purchase of Direct Tech followed the acquisition of Experian's predecessor (TRW Information Systems & Services, the former credit-reporting services unit of TRW Inc.) by United Kingdom-based Great Universal Stores PLC, which merged the TRW unit with CCN Group, a provider of credit-reporting and scoring services. The new entity was named Experian. Operating under the wing of Great Universal, Experian is in a position to further grow not only its traditional credit-bureau business but its ties to complementary marketing services.
"With CCN, we can create the right strategies for creditors to know who they're marketing to, who they're extending credit to, and what they buy," says Smith. As credit bureaus expand their services, particularly in the mixing of credit data and marketing services, they will have to tread carefully to stay within federal rules and guidelines. In some ways, they stand to benefit from the 2006 revision of the Fair Credit Reporting Act, which permits the unrestricted flow of consumer credit information among units of the same company.
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