Channel integration lets banks retain happy customers

Financial institutions can enhance customer satisfaction by leveraging branch activities with self-service kiosks and auto teller machines.
Written by Sol E. Solomon, Contributor

With today's ever-demanding and competitive banking environment, financial institutions cannot ignore the importance of not just attracting, but also retaining customers.

Ricardos Khoury, Asia-Pacific regional vice president and head of banking at Wincor Nixdorf, said the landscape will continue to be more challenging and competitive for financial institutions.

However, through the integration of technologies such as customer relationship management (CRM) with the automated teller machine (ATM), banks can continue to understand their customer needs and offer relevant products in a timely and cost-effective manner, Khoury said in an e-mail interview.

Wincor Nixdorf offers services to help retail banks handle the interface between the branch, Internet and call center. It integrates the bank's CRM functions, business intelligence and document and system management tools, with its own products and services and that of third-party vendors.

Roland Slee,
Oracle Asia-Pacific
Today customers have easy access to information on a dazzling array of competing financial solutions. The infrequent trickle of communication has become a raging torrent.

According to Wincor Nixdorf, the branch remains the most important service delivery channel due to its proximity to customers, and the availability of staff trained to handle the increasingly sophisticated needs of a bank's retail clientele.

However, the Internet, advancements in self-service kiosks and ATMs, have changed the way banks interact with their customers. Services that are made available through self-service technologies help free up bank tellers so that they can focus on consulting work.

Khoury said: "It's about getting rid of the standard teller in the branch and transforming that person into a trusted consultant who can deliver a higher level of customer intimacy."

Although banks in Singapore, Indonesia and the Philippines have generally continued to adopt one-to-one marketing in branch outlets to enhance service levels and capture cross-sell opportunities, Khoury said these can be handled by self-service systems or Internet terminals with an option that links customers with consultants whenever necessary.

"[For example], Internet-based marketing functions can be integrated into existing ATM applications," he said. After the customer's identity has been authenticated through a bank card at the ATM, data tied to that customer is then transferred to the CRM application in the backend network. A customer profile is then analyzed and used to compile a personalized product offering, which is displayed on the ATM screen while the customer waits for the transaction to be completed.

How OCBC scores on customer satisfaction

OCBC Bank's multi-channel strategy that incorporates customer relationship management (CRM), has enabled the bank to offer services that are relevant and differentiated to meet customer requirements.
Patrick Chew, the bank's head of group delivery, said in an e-mail interview: "For example, by incorporating our customers' needs into our ATM functionalities, we are able to deliver customized marketing messages where customers are able to respond instantaneously at the ATM to targeted offers."
Customizable transaction options include giving customers the option to set their own ATM transaction parameters. "With this personalized feature, our customers’ transaction time has been reduced by up to 75 percent," said Chew.
In 2007, the bank introduced a CRM-enabled feature at its ATMs that prompts ATM users to immediately update their contact details. It boosted a 9 percent response rate of customers completing their updates over the ATM, which Chew said was "significantly higher than the typical 1 to 2 percent using traditional methods of direct mailers and e-mail". It also helped OCBC achieve cost savings of over 60 percent, according to Chew.
CRM capabilities have also enabled the bank to send one-to-one targeted promotional messages to its Internet banking customers. For example, online banking customers will receive birthday greetings with personalized product offers.

"This process transforms a self-service system into an interactive delivery channel," Khoury said, adding that banks across Asia are already "excited about this".

Customer data collated in the CRM database is evaluated regularly to determine a customer's buying preferences, interests and interactions with the bank. Targeted marketing promotions can be designed and launched, and presented to customers with offers that are tailored to their specific needs.

Roland Slee, Oracle's Asia-Pacific vice president of financial services industry business, noted what he described as technology's "mostly positive impact" in recent years on the way customers interact with their financial institutions.

"They say information is power and not long ago, that power resided mainly with the institutions," Slee told ZDNet Asia in an e-mail interview. "Customers had very little ability to compare or contrast competing financial offerings."

"Today, customers have easy access to information on a dazzling array of competing financial solutions." He added that there is currently a "near-constant flow of information", facilitated online and via the telephone, between these institutions and their customers.

"The infrequent trickle of communication has become a raging torrent, [where] customers want to be in the know and be kept abreast of what is most relevant to them," Slee said.

Kept in the loop
At Great Eastern Life Assurance, data mining applications have enabled better communication lines between the company and its customers.

The Singapore-based insurer's executive vice president, Ng Koh Wee, said data mining helps the company detect customers based on their demographic profiles, and identify those that have not had any contact with the insurer for some time.

"A direct mailer goes out to them about certain products that might interest them, and our Life Planners would then make a call," he told ZDNet Asia in an e-mail interview. "We have been somewhat successful, achieving better response rates than normal 'cold call' type of mailers."

Slee concurred that data warehousing and data mining technologies have enabled financial institutions to understand their customers better than ever before.

"Most [customers would] acknowledge that the change has led to better customer service and more appropriately targeted offerings," he said. "Indeed, we now belong to micro-segments in which we are offered financial services that more closely match our specific requirements."

"Loyalty schemes encourage us to use our cards for almost every transaction, and while some used to worry about the loss of privacy associated with this, most seem to have become comfortable with the new environment," he added.

In addition, consumers today enjoy strong consumer protection, Slee said. "For instance, using our cards online for what seems like an exceptionally [high-value] transaction, would normally trigger a near-immediate phone call from the card issuer [requesting] verification."

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