Michael Yanuzzi, senior vice president of Business Intelligence at Standard Chartered First Bank Korea, calls the decision to invest in Teradata Relationship Manager a “slam dunk.”
in the bank
Standard Chartered First Bank Korea earns better results with more timely and targeted marketing offers.
In an increasingly competitive market, innovation is essential. For Standard Chartered First Bank Korea (SCFB), the South Korean subsidiary of international bank Standard Chartered PLC, maintaining its business advantage required a new approach: a customer-centric business model.
“We were doing well as a product-centric bank,” explains Michael Yanuzzi, senior vice president of Business Intelligence at SCFB. “But as the needs of our customers changed and our competitors became more skilled at product development, we saw an opportunity to shift to a more customer-focused approach.”
In fall 2007, SCFB began transitioning to a model that stressed providing specific products at specific times to meet each customer’s changing needs. It quickly became apparent that the bank also needed to alter its marketing campaigns to better attract and retain customers. “In some cases, our direct marketing campaigns had become a bit stale,” acknowledges Yanuzzi. “We weren’t being as innovative as we wanted, we weren’t increasing the number of campaigns, and they weren’t targeted as well as they could have been.”
The goal was to re-energize marketing efforts by more effectively targeting customers with creative, timely, personalized campaigns. To support this effort, the bank needed technology that would enable business users to create their own campaigns, without adding to the workload of IT or Yanuzzi’s analyst team. Just as SCFB began considering its next steps, Teradata consultants provided a path to more effective customer relationship management (CRM): Teradata Relationship Manager.
For many years, SCFB had successfully used an enterprise data warehouse (EDW) and CRM solutions from Teradata. In the Teradata Relationship Manager demonstration, SCFB executives and top management saw sophisticated features with a user-friendly interface brimming with possibilities. The bank could use existing EDW and IT infrastructure to improve the quality and number of its marketing campaigns. What’s more, the new solution would enable business users to develop and support their own campaigns while reducing the number of analysts required to support them.
“We knew that we needed to make our marketing campaign system easier to use,” says Yanuzzi. “Business users and front-line workers needed to be able to generate targeted lists and campaigns on their own. With Teradata Relationship Manager, the user-friendly interface allows anyone with basic computing skills to get on the system and create a campaign.”
Impressed with the capabilities, SCFB never considered any other solution. “We looked at the incremental value of investing in Teradata Relationship Manager, and the numbers were quite impressive,” he explains. “We calculated that we could achieve a return on investment [ROI] in less than one year, even using highly conservative numbers. Once we completed the business case, it was really a slam dunk.”
“With Teradata Relationship Manager, the user-friendly interface allows anyone with basic computing skills to get on the system and create a campaign.”
In fall 2008, the company installed Teradata Relationship Manager within its existing IT infrastructure. To kick-start the implementation, the bank conducted user training in parallel with the installation. Teradata Professional Services delivered workshops for SCFB’s Business Intelligence department, explaining the value of the new campaign system, showing how it could support event-based marketing, and detailing the plan to push out campaign management capabilities to business users. Training for power users followed, demonstrating optimal campaign design and techniques for generating targeted marketing. The installation and training were completed later that year. Immediately thereafter, the bank began rolling out the solution to 10 of its more than 300 branches. These early adopters began piloting the new event-based marketing and campaign management capabilities.
“We’re in a test-and-learn phase of the rollout now,” says Yanuzzi. “We are making sure that the pilot branches are generating high-quality campaigns, and we are tracking the results.” A phased rollout of the solution will continue this year, with workshops and training designed for new users combined with best practices learned from the SCFB early adopters. Yanuzzi expects all branches to be using the solution by the end of 2009.
Technical issues and training were not the only aspects of the deployment that required careful handling. Despite the support of executive management for the new system, some business users responded skeptically when asked to conduct their own marketing campaigns.
“Although my group is a service provider, there was an initial concern that we were trying to push work onto the business units,” says Yanuzzi. “It didn’t take long for the users to see how quickly and easily they can generate their own campaigns and get relevant market intelligence using Teradata Relationship Manager. We’re getting positive feedback from the business users about how easy the solution is to use.” A few power users even built an event-based marketing community, where they share best practices and innovative ideas.
“It didn’t take long for the users to see how quickly and easily they can generate their own campaigns and get relevant market intelligence using Teradata Relationship Manager.”
Given the difficult global economic climate, the bank may need a little more than 12 months to meet its ROI goal. Yet Yanuzzi says that SCFB is already realizing benefits.
Users can automatically generate increasingly targeted information, as well as data that details each customer’s relationship with SCFB. This information helps identify clients with the lowest risk, highest profitability and greatest loyalty. Over time, the bank hopes to use this information to migrate its best customers to more profitable products while reducing the resources dedicated to single-product or high-risk customers.
Campaign for customers
Marketing initiatives developed by the business are already being designed with greater thought and intelligence, Yanuzzi notes. As a result, some of the first event-based offers generated response rates of 10% to 15%, exceeding company expectations. The SCFB team plans to launch as many as 40 event-based marketing campaigns by the end of 2009.
The solution has also provided financial benefits. Automation features enabled the bank to reduce the number of analysts on the campaign management team from eight to six and redeploy these workers. The bank also spends less time on each effort. “With Teradata Relationship Manager, campaigns operate on auto-pilot, so we don’t need to assign resources to manual processes as we did before,” says Yanuzzi. “And when we want to tweak the campaign or track results, it is much easier to do with the Teradata solution.”
According to Yanuzzi, the information coming from the bank’s marketing system is richer and responses are timelier than before. “The quality of the campaign assessment is better, and analysts can quickly show key performance indicator results for campaigns,” he says. As a result, the bank can take faster, more focused action.
For example, the system helps SCFB recognize and respond quickly to an individual’s life events. “If a customer makes a significant deposit, we can now respond the next day with a targeted offer for a more profitable deposit or wealth management vehicle,” he explains. “If she takes a large advance on her credit card, we can call right away to offer her a lower-cost way of getting cash the next time.”
Focus on the future
Looking forward, SCFB hopes to increase the breadth and frequency of modeling activities at the end of each campaign, so marketers can better understand performance and fine-tune future efforts. The bank also plans to open its event-based marketing to additional customer channels, such as its ATM network. SCFB’s parent company, Standard Chartered, is so impressed by the new solution that it is considering using Teradata customer relationship solutions in other local offices.
Yanuzzi says the bank’s shift from a product-centric to a customer-centric business model was streamlined through the use of Teradata Relationship Manager. “The Teradata solution aligned perfectly with our strategy and initiatives to move to a customer-first approach, not only within Korea but also globally,” he says.