HOME WORK -2 Marketing of Financial Services

Topic:- Comparative analysis of the CRM strategies adopted by one Public sector bank, one private sector bank and an insurance company.

Submitted to: Ms. Shubhda Arora Lec. In LHSB«.

Submitted by:Puneet Soni Q1808A05

B.B.A(hons.)M.B.A

It is a process or a methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them.M. nurture and retain those the company already has. automate. which offers customers the convenience of one-stop shopping. and synchronize business processes principally sales activities.R. entice former clients back into the fold. customer service. It involves using technology to organize. sales. The three phases in which CRM can help to support the relationship between a business and its customers is explained below: y Acquire: A CRM initiative can help a business in acquiring new customers through excellent contact management. people. y Enhance: A web-enabled CRM combined with customer service tools offers customers excellent service from a team of trained and skilled sales and service specialists. and technical support. but also those for marketing. and win new clients. responsiveness and market trends.M. marketing effectiveness. selling and fulfillment. processes. and technology work in synergy to increase profitability. and reduce the costs of marketing and client service. Customer relationship management (CRM) is a broadly recognized. The overall goals are to find. . This process helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers. The term ³CRM´ stands for Customer Relationship Management. attract.R. Phases of C. y Retain: CRM software and databases enable a business to identify and reward its loyal customers and further develop its targeted marketing and relationship marketing initiatives. and reduce operational costs. direct marketing.Introduction to C. When an implementation is effective. clients and sales prospects. CRM is as a process that will help bring together lots of pieces of information about customers. widely-implemented strategy for managing and nurturing a company¶s interactions with customers.

y People: For an initiative to be effective. Benefits must be defined. Therefore. and cost quantified in three general areas: y Processes: Though these systems have many technological components. business processes lie at its core. resources. . before choosing a technology platform. an organization must convince its staff that change is good and that the new technology and workflows will benefit employees as well as clients.R. planners need to determine the types of client information that are most relevant. Moreover. key factors include alignment with the company¶s business process strategy and goals. Collaboration. and market trends. teamwork. marketing effectiveness. especially with respect to process improvement. enabled by technology that consolidates and intelligently distributes pertinent information about clients. choosing an application can take anywhere from a few weeks to a year or more. and sufficient ease of use that users won¶t balk. a complete and detailed plan is required to obtain the funding. y Technology: In evaluating technology. and company-wide support that can make the initiative successful.M Choosing and implementing a system is a major undertaking. Platform selection is best undertaken by a carefully chosen group of executives who understand the business processes to be automated as well as the various software issues. some will likely need re-engineering to better serve the overall goal of winning and satisfying clients. responsiveness. Depending upon the size of the company and the breadth of data. For enterprises of any appreciable size. a company needs to analyze its business workflows and processes. Senior executives need to be strong and visible advocates who can clearly state and support the case for change. It can be seen as a more client-centric way of doing business. the ability to deliver the right data to the right employees. sales. risks assessed.Strategy of C. and how best to employ them. and two-way communication should be encouraged across hierarchical boundaries.

They needed client/server architecture in place. Although the organi ation had a centrali ed system. the insurance major had little enterprise software to support its business and the processes were carried out in an ad hoc manner. . The system went live in 2004. Earlier. The challenge was to meet the demanding service and fulfillment levels of the growing insurance sector. the top management reali ed that technology was a crucial driver for product and service delivery. Although using the extensive SBI group platform for cross -selling products and services was a viable option. Early on. most of the work was done manually. It was clear as far back as 2002 that a durable and scalab system was going to be essential. But it was not integrated with the legacy systems. taking just four to five months to go online.SBI Life was on the lookout for a technology solution that was easy to implement costeffective and robust to expand its presence in the insurance sector and achieve a higher degree of service differentiation. The portal initiative started sometime in 2003.C R M i iti ti t t B y y y y y y y i t B it t i i i li : Personal Banking NR Servi es Agri lt re International Corporate SM Domesti Treasurer C R M and SBI li e Need for CRM The need for system automation became critical at SBI Life Insurance. le and it was felt that a Web portal would be the best solution as a part of SBI¶s CRM initiative. reaching and engaging the customer cost effectively required a technology backbone.

etc. Another important issue was support. Typically. . the vendor had to have a roadmap extending well into the future. Most importantly. SBI also spoke to some leading providers in the industry. many implementations are not up to the mark due to cultural aspects of business. using the Internet fits perfectly into their scheme of things. it decided to use the Internet to tackle the problem of linkage across locations in India. The other concern for SBI Life was connectivity.Various options were taken into consideration-recreating their entire operations in-house. Benefits of CRM in SBI Life y y Reduction in TAT (Turn Around Time) SBI Life can now integrate and manage content. allowing a vendor to provide the basic platform and then build applications on it. and finally decided to go for BE A WebLogic.000 branches. did some spadework. campaigns and merchandising to patrons via the Web y Streamlined product delivery and support processes with a single contact point on the Web y Site offers a one-stop-shop for customers' insurance needs The insurer was looking at a system that would be up and ready in the shortest span of time. Acceptance among staff and familiarity of employees with the system were two of the things we considered before they decided to go in for a full-fledged implementation. They believe that the product by itself should be mature enough to manage both its own complexity as well as that of the business. (SBI has a network of over 9. in a stable manner.) Since laying out the network. When looking for vendors SBI sought cutting-edge technology that did not cost the earth. and roll out business-critical applications. In India. Indian service providers do not have the capability to deliver the required services. application and infrastructure is time consuming and not very cost-effective. and also offer ease of use for those who work on it.

dial-up connections. insurance claims. The type of connectivity depends on the number of users in that particular branch and the kind of work being done there. the BEA solution was a model that enabled faster customization and development of applications. They are still adding new functionalities. . with better utilization of manpower. SBI has been able to decentralize 36 branches. etc. telephone lines. The solution has also brought down by 50 percent the time taken for specific processes like cash management.There were hiccups as various centers had problems connecting to the CRM portal. Outcome: Saving time and money Process improvements are evident. As a result. With almost 30 functions already running on the site. Unlike separate frameworks for integration and custom application development. and is looking at service oriented architecture (SOA) in the future. All of this happened with minimal system changes without adding to the existing infrastructure. broadband connections. They are using multiple types of connectivity. and accounting. The insurer has managed to save about 30 percent of costs on infrastructure. they feel that in future the portal has the capability to scale up to handle a much bigger transaction load. leased lines that terminate at the central data centre in Mumbai. The company is to add applications in a phased manner. and with an SOA they can maintain the value provided to our customers while minimizing investments in maintenance and development. which have been solved.

993.M. For the quarter ended December 31. As on December 31. 2007. the Bank had a network of 754 branches and 1. The bank's competitive strength lies in the use of technology and the propensity to deliver world -class service with rapid response time.R. the bank has been s ccessfully able to gain u market share in its target customer franchises while maintaining healthy profitability and asset quality.C. initiatives at HDFC About HDFC Promoted in 1995 by Housing Development Finance Corporation (HDFC . Within a relatively short span of time. . Total balance sheet si e too grew by 46. HDFC Bank is one of India's premier banks providing a wide range of financial products and services to its over 11 million customers across over three hundred cities using multiple distribution channels including a pan -India network of branches. 2007. wholesal banking.2%. 4. over the corresponding quarter of previous year.9 billion.3 billion. up 45. Total deposits were Rs. the bank reported a net profit of Rs. the bank has emerged as a leading player in retail banking. its three principal business segments. up 48.9% over the corresponding quarter of previous year. ATMs. Over the last 13 years. India's leading housing finance company.1. phone banking.3144 billion.7% to Rs. e and treasury operations. net banking and mobile banking.906 ATMs in 327 cities.

SMS or direct mail which vary from product y For cardholders who don¶t respond to the offer in the first wave.R. y These members are then segmented into distinct groups and are sent targeted offers via email. and right-time interaction management capabilities.The challenges:- y With HDFC Bank¶s success and rapid growth. . which resulted in reduction of acquisition cost by 60 percent due to effective targeting and channel optimization. multi-wave campaign has been designed. quick implementation as well as its robust modeling. in order to make sure new inactive card members are identified and communicated with on a timely basis. design. C. a targeted multi-channel. y It also needed a way to detect important events in a customer¶s life so that targeted communications could be sent at the right time to build relationships and increase profit. y This campaign automatically runs every ten days. HDFC Bank has boosted customer retention by four percent. inactive members are identified.M. email. automated process was required to access data across systems as well as plan. test. SMS and call centers. Credit card activation In order to boost credit card activation by a goal of seven to 16 percent. solution y After evaluating several vendors. y y For instance. y A central. optimize and execute marketing efforts across channels including direct mail. y Affinium was chosen for its ease of use. As ten days after a new cardholder is approved. stronger customer relationships. a second communication with a different offer is sent. and executed acquisition campaigns. customer analysis. Results:y With Affinium. HDFC Bank selected Unica¶s Affinium solution for enterprise marketing management. it needed an effective way to increase customer profitability through deeper.

in. the credit card activation campaign has achieved an incremental activation rate of 30 percent compared to activation efforts without predictive modeling. HDFC Bank Gold Credit Card. Free Airmiles across leading airlines on redemption of reward points. y It allows cardholders to create a secret password. y VbV is a global program by Visa. y The bank also offers its cardholders NetSafe. 5% Cash back on rail ticket bookings through irctc. for identifying and authenticating cardholders when they purchase on the Internet. For eg. based on 3-D secure technology. which should allow it to have one comprehensive and intelligent view of its customers.co.y Following the implementation of Affinium. Get 5% CashBack* on railway ticket booking through IRCTC on HDFC Bank Gold and Value Plus Credit Cards RAP computer technology integration:- y The bank is currently working on a customer data model that covers over 6. 5% Cash back on domestic air ticket bookings through domestic airline websites. Debit card early activation program resulted in incremental response of five percent over the normal activation rates. VbV facility for HDFC customers:- y HDFC Bank has introduced Verified by Visa (VbV) facility for all its credit and debit cardholders. y HDFC uses the data bases in its varied ways. which they require to authenticate the payment and complete the transaction when shopping online. .000 fields. a virtual card through which they can shop online without revealing their card number. They get the data from the various companies and formulate the offers keeping in mind the needs and the usage of the customers. Offers:y y y Exclusive travel benefits only on HDFC Bank Gold Credit Card. the campaign volume increased by over 200 percent y Lastly.

HDFC Bank has brought online its RAP Computer Telephony Integration (CTI) initiative for the bank's 14 contact centers. . it would affect the customer experience and adds to the call time. y The RAP CTI system pulls the select data from various screens in the host and makes it available as the agent picks up the call.000 actual calls per month. which service as many as 650. y The system gives the bank's contact center agents a view of data most often needed in standard customer interactions. the agent does not need to toggle between data sources any longer. If the agent were to toggle. y With the new system. The bank has populated the host system with offers available for qualified customers. y The agent is also able to see outstanding offers.y With regard to operational CRM.

insurance and other investments. Right from the moment the inquiry comes. CUSTOMIZED OFFERINGS TO THE CUSTOMER:. the bank has many customers in each category. saving account. Example If customer has saving account with the bank then we offer him loan. The processes for delivering CRM The tools and the processes are as follow ± y y y y y Customer application form Centralized software where the whole data is collected.up the customer and then make him to come to the bank occasionally and then regularly. they collect the data on one server and thus the company gets the personalized information on each customer by asking them to fill the information in customer application form. Wide range of offering. they also practice a concept called cross. CONVERTING A PROSPECTIVE CUSTOMER INTO A TRUE CUSTOMER. anywhere.CRM OF ICICI BANK:GETTING PERSONALIZED INFORMATION ON CUSTOMERS:. current account and fixed deposits. This process helps in collecting the data and knowing what the customer wants. Moreover. they follow. Centralized software where the whole data is collected. this helps in the further process of customized offerings and cross ±selling.The step which comes after deciding the value of the customer is that the company offers the person the customized product. So.:. Cross ± selling and Feedback forms Customer application forms:. .The bank collects all the information about the customers for processing.Bank collects all the data from customer application form and gets the personalized information to know which product to offer to which customer.selling over here. Cross ± selling refers to offering another product from the service offering of the bank to the customer which he has not gone for. So. Moreover. The data collected through customer application forms is available at one server and can be accessed anytime. ICICI bank has mainly 4 service offerings viz: loan account.The last approach of CRM according to ICICI bank is that they try to convert the prospective customer into a true customer.

Make balance enquiries. The customer feedbacks on the service.Wide range of offering :. Loans against Shares. The more business he gives us. ATM NETWORKS y y y y y More than 3500 networked ATMs across the country. Credit and Debit cards. Bonds. This depends on the value of the customer to the bank. In case the bank recognizes you as a valuable customer then is offers a more customized service. Demat Accounts. Make cash withdrawals Free access to all ATMs Trilingual ATMs . etc. Cross ± selling :-It refers to offering another product from the service offering of the bank to the customer which he has not gone for. Internet Banking. technology used. DIFFERENT CHANNELS FOR ACCESS SERVICES Bank Branch. team decides what product to offer to which customer. Feedback forms:.After collecting the data from the customer. Insta Banking. ATM Phone Banking. employee behavior and promptness in solving customer¶s problems. It depends on how loyal the customer is to the bank. Call Centre BANK BRANCH You can find a host of ICICI retail products at our widespread Bank Branch network-Bank Accounts. Mobile Banking.The bank distributes feedback forms at all its branches. For example If customer has savings account with the bank then they offer him a insurance. are taken and they are analyzed. fixed deposits etc. the more are his chances of being special services offered. Cross selling is not offered to every customer.

PHONE BANKING y y y y y y y y 24 hour manned Customer Care Center Interactive Voice Response (IVR) facility available.Com or call the phone banking number to do the same. phone etc. telephone. Bill pay requests Stop payment request Balance enquiries Give standing instructions for payments Open a Fixed Deposit Dial ± a ± draft INTERNET BANKING y y y y y y y Payment of Utility Bills-electricity. Mini statement shows last 10 transactions Ledger Balance available in Mini statement. Just log on to icicibank.y y y Payee name available on the Mini statement. y y y Check the status of the payments made Query on all the bill payments made by you The bill pay service is absolutely free of cost. Online Railway ticket booking 3-in-1 Demat Account Inter Bank funds transfer (available in select cities) Third party transfers Credit Card bill payments Enable mobile banking alerts Importance of Internet Banking for customers Bill payments:You can pay your bills like electricity. . mobile phone bills and insurance premium bills etc online. or through phone banking. gas etc.

m. You can avail of this anywhere-Anytime banking service through our 24-hour channels like ATM. .ICICI bank mobile banking can be divided into two broad categories of facilities: Alert facility: ICICI bank mobile banking alerts facility keeps you informed about the significant transactions in your accounts. These unique and user-friendly channels have brought banking services to your fingertips. Instant Voice Response (IVR) Banking and Mobile Banking. Internet Banking. and from 8 a. to 8 p. From balance enquiry to checking cheque status to ordering a new cheque book. you can communicate with ICICI Bank from the comfort of your home or in the middle of a busy day at the office. It keeps you updated wherever you go. INSTA BANKING ICICI Bank¶s ³Insta Banking´ enables you to conduct banking transactions anytime from anywhere.Mobile Banking y y ICICI bank mobile banking enables you to bank while being on the move . y Request facility: ICICI bank mobile banking requests facility enables you to query for your account balance.m.

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