Fannie Mae Analyzes Ethnic Housing Patterns
The nation's largest financier of home mortgages aims to determine settlement patterns for owning versus renting to better target its outreach efforts. Helping in this endeavor is the Geoscape Intelligence System for data exploration, visualization and analyses.
"Previously they looked at tabular [U.S.] census data reports, and they used a desktop system," said Cesar M. Melgoza, CEO of Geoscape International Inc., Miami. "Neither were optimal due to the combination of technical requirements and lack of visualization capability."
Hosting vast quantities of data that change quickly was another issue for Fannie Mae, Washington. It hopes to address these many concerns as a beta user of Geoscape.
Fannie Mae, or Federal National Mortgage Association, has offered mortgage loans worth more than $4 trillion to 49 million families since 1968. It now looks to narrow the country's homeownership gaps through a $2 trillion "American Dream Commitment." The company aims to boost homeownership rates and focus on 18 million targeted U.S. families by 2010.
The use of Geoscape, which began in mid-March, is part of that mission.
Geoscape includes data that give companies deep understanding of the U.S. ethnic market landscape. Specifically, it drills to the household level through demographic data and name-based technologies to reveal characteristics of the multicultural consumer. But the nine interactive modules are at the heart of the system.
For example, Fannie Mae can pull up a geo-demographic profile using the 2000 census data as well as Geoscape's own 2003 and 2008 estimates. This can be done on a map by zooming into ZIP code data. The data can be viewed onscreen or downloaded in Excel format for analysis.
Likewise, Geoscape will allow for queries to find a particular target. It could be ethnicity or income cross-section. The system's multidimensional reporting analyzer quickly pulls up large volumes of data, summarizing, expanding and reporting such information for further analysis.
Other features include retail targeting as well as examining media targeting, initially radio and television, for characteristics of that coverage.
There are other key offerings. The DirecTarget function identifies groups within a company house file for better understanding, modeling and analysis. The List Gateway lets companies like Fannie Mae build a complex query. It gives an account of the number of people within a certain ethnicity who are in a state or metropolitan area. This helps with telemarketing and e-mail outreach.
Geoscape's product is accessed online through a $795 annual subscription for the Marketscape and reporting functions with 2000 census data. Users can generate unlimited reports and maps. But access to other modules is on a pay-as-you-go basis. So, analyzing a retail site to profile its database can cost $50.
Fannie Mae is not the only user of the Geoscape Intelligence System. New York multicultural agency GlobalWorks uses it to understand automotive dealer characteristics in a challenging retail environment. And researcher Synovate's Miami-based diversity division subscribes for generating better surveys based on the ethnic composition of markets.
Though Geoscape includes general market data, the chief lure is its data on Hispanics, Asian Indians and other growing ethnic segments. Fannie Mae's main interest is an ethnic market with buying power estimated at $580 billion for 2002 and $925.1 billion by 2007, according to the University of Georgia's Selig Center for Economic Growth.
"Fannie Mae's using it for all the interesting things that they're targeting, especially in Hispanic and other multicultural mortgage lending," Melgoza said.