Category Archives: Customer Acquisition & Retention

Data Driven Retail: The Path to Maximize Shopper Experience

Retail

Data Driven Retail: The Path to Maximize Shopper Experience

On our recent webinar with Omer Minkara from Aberdeen Group , we learnt that“94% of companies are not satisfied with their use of customer data”, yet retailers still want more data to gain valuable customer insights to drive improvements in the shopper experience. But the top challenge they face when managing customer data as part of their business activities is the quality of the data.  Data-Driven retailers are characterized by their ability to balance quantity and quality of data effectively.

Shoppers expect consistency in their interactions with you, whether it’s the same price across channels, accurate shipping information or when they are calling a contact center. However, one of the top frustrations for consumers is the need to provide the same information over and over as they interact with the retailer. This data is already captured in multiple systems but is not connected or clean. Fragmented views of customer data across multiple systems makes it harder to personalize shopper interaction and enhance the overall customer experience.

Bring your data management to today’s omni-channel world

By standardizing customer data across the organization and having a centralized repository of product and service information available to all customer facing roles, data- driven retailers have enjoyed increased margins, higher returns on marketing investments, shorter delivery times and improved time to market for products and services.

Data-driven retailers are not just meeting customer expectations, they are exceeding them.

In my next blog I will look at some of the questions we did not get to answer during this session. In the meantime, why not register for our next webinar “Calculating Omni-Channel Customer Experience – March 19 Webinar” with Arkady Kleyner, Solution Architect, Intricity.

Don’t to follow us on twitter @INFARetail.

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Payers – What They Are Good At, And What They Need Help With

healthcare_bigdata

Payers – What They Are Good At, And What They Need Help With

In our house when we paint a room, my husband does the big rolling of the walls or ceiling, I do the cut-in work. I am good at prepping the room, taping all the trim and deliberately painting the corners. However, I am thrifty and constantly concerned that we won’t have enough paint to finish a room. My husband isn’t afraid to use enough paint and is extremely efficient at painting a wall in a single even coat. As a result, I don’t do the big rolling and he doesn’t do the cutting in. It took us awhile to figure this out, and a few rooms had to be repainted while we were figuring it out.  Now we know what we are good at, and what we need help with.

Payers roles are changing. Payers were previously focused on risk assessment, setting and collecting premiums, analyzing claims and making payments – all while optimizing revenues. Payers are pretty good at selling to employers, figuring out the cost/benefit ratio from an employers perspective and ensuring a good, profitable product. With the advent of the Affordable Healthcare Act along with a much more transient insured population, payers now must focus more on the individual insured and be able to communicate with the individuals in a more nimble manner than in the past.

Individual members will shop for insurance based on consumer feedback and price. They are interested in ease of enrollment and the ability to submit and substantiate claims quickly and intuitively. Payers are discovering that they need to help manage population health at a individual member level. And population health management requires less of a business-data analytics approach and more social media and gaming-style logic to understand patients. In this way, payers can help develop interventions to sustain behavioral changes for better health.

When designing such analytics, payers should consider the following key design steps:

Due to payers’ mature predictive analytics competencies, they will have a much easier time in the next generation of population behavior compared to their provider counterparts. As clinical content is often unstructured compared to the claims data, payers need to pay extra attention to context and semantics when deciphering clinical content submitted by providers. Payers can use help from vendors that can help them understand unstructured data, individual members. They can then use that data to create fantastic predictive analytic solutions.

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Posted in 5 Sales Plays, Application Retirement, Big Data, Cloud Application Integration, Cloud Data Integration, Customer Acquisition & Retention, Customer Services, Data Governance, Data Quality, Governance, Risk and Compliance, Healthcare, Total Customer Relationship | Tagged | Leave a comment

Asia-Pacific Ecommerce surpassed Europe and North America

With a total B2C e-commerce turnover of $567.3bn in 2013, Asia-Pacific was the strongest e-commerce region in the world in 2013, as it surpassed Europe ($482.3bn) and North America ($452.4bn). Online sales in Asia-Pacific expected to have reached $799.2 billion in 2014, due to latest report from the Ecommerce Foundation.

Revenue: China, followed by Japan and Australia
As a matter of fact, China was the second-largest e-commerce market in the world, only behind the US ($419.0 billion), and for 2014 it is estimated that China even surpassed the US ($537.0 billion vs. $456.0 billion). In terms of B2C e-commerce turnover, Japan ($136.7 billion) ranked second, followed by Australia ($35.7 billion), South Korea ($20.2 billion) and India ($10.7 billion).

On average, Asian-Pacific e-shoppers spent $1,268 online in 2013
Ecommerce Europe’s research reveals that 235.7 million consumers in Asia-Pacific purchased goods and services online in 2013. On average, APAC online consumers each spent $1,268 online in 2013. This is slightly lower than the global average of $1,304. At $2,167, Australian e-shopper were the biggest spenders online, followed by the Japanese ($1,808) and China ($1,087).

Mobile: Japan and Australia lead the pack
In the frequency of mobile purchasing Japan shows the highest adoption, followed by Japan. An interesting fact is that 50% of transactions are done at home, 20% at work and 10% on the go.

frequency mobile shopping APAC

You can download the full report here. What does this mean for your business opportunity? Read more on the omnichannel trends 2015, which are driving customer experience. Happy to discuss @benrund.

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Posted in CMO, Customer Acquisition & Retention, DaaS, Data Quality, Manufacturing, Master Data Management, PiM, Product Information Management, Retail | Tagged , , , , | Leave a comment

Healthcare Consumer Engagement

The signs that healthcare is becoming a more consumer (think patients, members, Healthcareproviders)  driven industry are evident all around us. I see provider and payer organizations clamoring for more data, specifically data that is actionable, relatable and has integrity. Armed with this data, healthcare organizations are able to differentiate around a member/patient-centric view.

These consumer-centric views convey the total value of the relationships healthcare organizations have with consumers. Understanding the total value creates a more comprehensive understanding of consumers because they deliver a complete picture of an individual’s critical relationships including: patient to primary care provider, member to household, provider to network and even members to legacy plans. This is the type of knowledge that informs new treatments, targets preventative care programs and improves outcomes.

Payer organizations are collecting and analyzing data to identify opportunities for  more informed care management and segmentation to reach new, high value customers in individual markets. By segmenting and targeting messaging to specific populations, health plans generate increased member satisfaction and cost effectively expands and manages provider networks.

How will they accomplish this? Enabling members to interact in health and wellness forums, analyzing member behavior and trends and informing care management programs with a 360 view of members… to name a few . Payers will also drive new member programs, member retention and member engagement marketing and sales programs by investigating complete views of member households and market segments.

In the provider space, this relationship building can be a little more challenging because often consumers as patients do not interact with their doctor unless they are sick, creating gaps in data. When provider organizations have a better understanding of their patients and providers, they can increase patient satisfaction and proactively offer preventative care to the sickest (and most likely to engage) of patients before an episode occurs. These activities result in increased market share and improved outcomes.

Where can providers start? By creating a 360 view of the patient, organizations can now improve care coordination, open new patient service centers and develop patient engagement programs.

Analyzing populations of patients, and fostering patient engagement based on Meaningful Use requirements or Accountable Care requirements, building out referral networks and developing physician relationships are essential ingredients in consumer engagement. Knowing your patients and providing a better patient experience than your competition will differentiate provider organizations.

You may say “This all sounds great, but how does it work?” An essential ingredient is clean, safe and connected data.  Clean, safe and connected data requires an investment in data as an asset… just like you invest in real estate and human capital, you must invest in the accessibility and quality of your data. To be successful, arm your team with tools to govern data –ensuring ongoing integrity and quality of data, removes duplicate records and dynamically incorporates data validation/quality rules. These tools include master data management, data quality, metadata management and are focused on information quality. Tools focused on information quality support a total customer relationship view of members, patients and providers.

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Getting Personal with Data as a Service (DaaS)

Getting Personal with Data as a Service (DaaS)

Getting Personal with Data as a Service (DaaS)

Last week, I spent three days at Retail’s Big Show hosted by the National Retail Federation (NRF) in New York City. This annual event gives retailers the opportunity to network with their colleagues from all over the world. In addition, they get the chance to interact with technology vendors that can help them improve their business.

From marketing automation to analytics software, there were countless technology offerings showcasing how to best assist the modern marketer in making every customer interaction personal. Throughout the week, I had numerous conversations with retail professionals about the importance of personalization in marketing and what it means to their organization’s future plans.

At the heart of their plans was the need to understand the data that they have today, and how to verify the data that they will inevitably acquire in the future. If it’s accurate, if it’s reliable, if it’s complete – customer data can fuel your ability to engage and interact.

The data driven marketer derives insight and ultimately provides a personalized experience by leveraging this valuable data for each customer.

And why is this important?

Well, according to McMurrayTMG, 78% of buyers believe that organizations providing a personalized experience are interested in building good relationships. But it all starts with accurate data.

Knowing who your customers are, how you can contact them, and what they are interested in are essential in order to engage with your customers. With the abundance of data available today, you have to figure that if you aren’t ensuring that your customer interactions are personalized, then your competitors are gaining ground. Every interaction, every correspondence counts towards a positive perception as well as increased sales and customer satisfaction.

By fueling your interactions with Data as a Service (DaaS) for accurate customer data, you will ensure that your customers have a personalized experience with your brand and ultimately accelerate your business.

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Posted in CMO, Customer Acquisition & Retention, Customers, DaaS, Data Quality, Retail, Total Customer Relationship | Tagged , , , , , , , | Leave a comment

Does Your Sales Team Have What They Need to Succeed in 2015?

Like me, you probably just returned from an inspiring Sales Kick Off 2015 event. You’ve invested in talented people. You’ve trained them with the skills and knowledge they need to identify, qualify, validate, negotiate and close deals. You’ve invested in world-class applications, like Salesforce Sales Cloud, to empower your sales team to sell more effectively. But does your sales team have what they need to succeed in 2015?

Gartner predicts that as early as next year, companies will compete primarily on the customer experiences they deliver. So, every customer interaction counts. Knowing your customers is key to delivering great sales experiences.

If you’re not fueling Salesforce Sales Cloud with clean, consistent and connected customer information, your sales team may be at a disadvantage against the competition.
If you’re not fueling Salesforce Sales Cloud with clean, consistent and connected customer information, your sales team may be at a disadvantage against the competition.

But, inaccurate, inconsistent and disconnected customer information may be holding your sales team back from delivering great sales experiences. If you’re not fueling Salesforce Sales Cloud (or another Sales Force Automation (SFA) application) with clean, consistent and connected customer information, your sales team may be at a disadvantage against the competition.

To successfully compete and deliver great sales experiences more efficiently, your sales team needs a complete picture of their customers. They don’t want to pull information from multiple applications and then reconcile it in spreadsheets. They want direct access to the Total Customer Relationship across channels, touch points and products within their Salesforce Sales Cloud.

Watch this short video comparing a day-in-the-life of two sales reps competing for the same business. One has access to the Total Customer Relationship in Salesforce Sales Cloud, the other does not. Watch now: Salesforce.com with Clean, Consistent and Connected Customer Information.

Salesforce and Informatica Video

Is your sales team spending time creating spreadsheets by pulling together customer information from multiple applications and then reconciling it to understand the Total Customer Relationship across channels, touch points and products? If so, how much is it costing your business? Or is your sales team engaging with customers without understanding the Total Customer Relationship? How much is that costing your business?

Many innovative sales leaders are gaining a competitive edge by better leveraging their customer data to empower their sales teams to deliver great sales experiences. They are fueling business and analytical applications, like Salesforce Sales Cloud, with clean, consistent and connected customer information.  They are arming their sales teams with direct access to richer customer profiles, which includes the Total Customer Relationship across channels, touch points and products.

What measurable results have these sales leaders acheived? Merrill Lynch boosted sales productivity by 15%, resulting in $50M in annual impact. A $60B manufacturing company improved cross-sell and up-sell success by 5%. Logitech increased across channels: online, in their retail partner’s stores and through distribution partners.

This year, I believe more sales leaders will focus on leveraging their customer information for competitive advantage. This will help them shift from sales automation to sales optimization. What do you think?

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Posted in 5 Sales Plays, Business Impact / Benefits, Business/IT Collaboration, CIO, Cloud, Cloud Computing, Cloud Data Integration, Cloud Data Management, Customer Acquisition & Retention, Data Integration, Data Quality, Enterprise Data Management, Intelligent Data Platform, Master Data Management, Operational Efficiency, SaaS, Total Customer Relationship | Tagged , , , , , , , , , , , , , , , | 1 Comment

Is Your Data Ready to Maximize Value from Your CRM Investments?

Is Your Data Ready to Maximize Value from Your CRM Investments?

Is Your Data Ready to Maximize Value from Your CRM Investments?

A friend of mine recently reached out to me about some advice on CRM solutions in the market.  Though I have not worked for a CRM vendor, I’ve had both direct experience working for companies that implemented such solutions to my current role interacting with large and small organizations regarding their data requirements to support ongoing application investments across industries. As we spoke, memories started to surface when he and I had worked on implementing Salesforce.com (SFDC) many years ago. Memories that we wanted to forget but important to call out given his new situation.

We worked together for a large mortgage lending software vendor selling loan origination solutions to brokers and small lenders mainly through email and snail mail based marketing.  He was responsible for Marketing Operations, and I ran Product Marketing. The company looked at Salesforce.com to help streamline our sales operations  and improve how we marketed and serviced our customers.  The existing CRM system was from the early 90’s and though it did what the company needed it to do, it was heavily customized, costly to operate, and served its life. It was time to upgrade, to help grow the business, improve business productivity, and enhance customer relationships.

After 90 days of rolling out SFDC, we ran into some old familiar problems across the business.  Sales reps continued to struggle in knowing who was a current customer using our software, marketing managers could not create quality mailing lists for prospecting purposes, and call center reps were not able to tell if the person on the other end was a customer or prospect. Everyone wondered why this was happening given we adopted the best CRM solution in the market.  You can imagine the heartburn and ulcers we all had after making such a huge investment in our new CRM solution.  C-Level executives were questioning our decisions and blaming the applications. The truth was, the issues were not related to SFDC but the data that we had migrated into the system and the lack proper governance and a capable information architecture to support the required data management integration between systems that caused these significant headaches.

During the implementation phase, IT imported our entire customer database of 200K+ unique customer entities from the old system to SFDC. Unfortunately, the mortgage industry was very transient and on average there were roughly 55K licenses mortgage brokers and lenders in the market and because no one ever validated the accuracy of who was really a customer vs. someone who had ever bought out product, we had a serious data quality issues including:

  • Trial users  who purchased evaluation copies of our products that expired were tagged as current customers
  • Duplicate records caused by manual data entry errors consisting of companies with similar but entered slightly differently with the same business address were tagged as unique customers
  • Subsidiaries of parent companies in different parts of the country that were tagged again as a unique customer.
  • Lastly, we imported the marketing contact database of prospects which were incorrectly accounted for as a customer in the new system

We also failed to integrate real-time purchasing data and information from our procurement systems for sales and support to handle customer requests. Instead of integrating that data in real-time with proper technology, IT had manually loaded these records at the end of the week via FTP resulting in incorrect billing information, statement processing, and a ton of complaints from customers through our call center. The price we paid for not paying attention to our data quality and integration requirements before we rolled out Salesforce.com was significant for a company of our size. For example:

  • Marketing got hit pretty hard. Each quarter we mailed evaluation copies of new products to our customer database of 200K, each costing the company $12 per to produce and mail. Total cost = $2.4M annually.  Because we had such bad data,  we would get 60% of our mailings returned because of invalid addresses or wrong contact information. The cost of bad data to marketing = $1.44M annually.
  • Next, Sales struggled miserably when trying to upgrade a customer by running cold call campaigns using the names in the database. As a result, sales productivity dropped by 40% and experienced over 35% sales turnover that year. Within a year of using SFDC, our head of sales got let go. Not good!
  • Customer support used SFDC to service customers, our average all times were 40 min per service ticket. We had believed that was “business as usual” until we surveyed what reps were spending their time each day and over 50% said it was dealing with billing issues caused by bad contact information in the CRM system.

At the end of our conversation, this was my advice to my friend:

  • Conduct a data quality audit of the systems that would interact with the CRM system. Audit how complete your critical master and reference data is including names, addresses, customer ID, etc.
  • Do this before you invest in a new CRM system. You may find that much of the challenges faced with your existing applications may be caused by the data gaps vs. the legacy application.
  • If they had a data governance program, involve them in the CRM initiative to ensure they understand what your requirements are and see how they can help.
  • However, if you do decide to modernize, collaborate and involve your IT teams, especially between your Application Development teams and your Enterprise Architects to ensure all of the best options are considered to handle your data sharing and migration needs.
  • Lastly, consult with your technology partners including your new CRM vendor, they may be working with solution providers to help address these data issues as you are probably not the only one in this situation.

Looking Ahead!

CRM systems have come a long way in today’s Big Data and Cloud Era. Many firms are adopting more flexible solutions offered through the Cloud like Salesforce.com, Microsoft Dynamics, and others. Regardless of how old or new, on premise or in the cloud, companies invest in CRM not to just serve their sales teams or increase marketing conversion rates, but to improve your business relationship with your customers. Period! It’s about ensuring you have data in these systems that is trustworthy, complete, up to date, and actionable to improve customer service and help drive sales of new products and services to increase wallet share. So how to do you maximize your business potential from these critical business applications?

Whether you are adopting your first CRM solution or upgrading an existing one, keep in mind that Customer Relationship Management is a business strategy, not just a software purchase. It’s also about having a sound and capable data management and governance strategy supported by people, processes, and technology to ensure you can:

  • Access and migrate data from old to new avoiding develop cost overruns and project delays.
  • Identify, detect, and distribute transactional and reference data from existing systems into your front line business application in real-time!
  • Manage data quality errors including duplicate records, invalid names and contact information due to proper data governance and proactive data quality monitoring and measurement during and after deployment
  • Govern and share authoritative master records of customer, contact, product, and other master data between systems in a trusted manner.

Will your data be ready for your new CRM investments?  To learn more:

Follow me on Twitter @DataisGR8

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Posted in Architects, Cloud, Cloud Application Integration, Cloud Computing, Cloud Data Integration, Cloud Data Management, CMO, Customer Acquisition & Retention, SaaS | Tagged , , , , , , , , , | Leave a comment

Smarter Dummies, Connected Hangers and Personalized Mirrors!

Smarter Dummies, Connected Hangers and Personalized Mirrors

Smarter Dummies, Connected Hangers and Personalized Mirrors

With CES and the NRF Big Show just over and many exhibitors talking about the “Internet of Things” below I take a quick look at what is happening for retailers with the “Internet of Things”.

Consumer demand is driving the adoption of IoT as they embrace the new technology to improve health (Garmin Vívoactive), energy savings (NEST), safety (BeClose) and a better overall experience including shopping (beacons?). However, getting the balance between privacy, intrusion and relevance can be tricky for both the retailer and shopper.

While shoppers are willing to give up some level of privacy in return for personalization, I am not convinced most are ready of what the “Internet of Things” brings. I recently purchased a smart TV and was surprised when I was asked to accept terms and conditions before using, what are they capturing, how will it be used, will I see any benefits?  Retailers need to demonstrate value and trust to the consumer.

While RFID has been around for many years the next wave of intelligent “things” bring both opportunities and challenges. Retailers need to decide which ones truly enhance the shopping experience.

“Psst! It’s Me, the Mannequin. This Would Look Great on You.” (Rachel Abrams, NY Times)

Smart Dummies (mannequins) – Last year House of Fraser started rolling out beacon-enabled mannequins to engage directly with shoppers and passers-by. Shoppers within a 50-metre range will receive information from the mannequins, which may include details about the clothes on display, with links to make a purchase from a website, or details of where the outfit can be found in the store. The next step could link customer preferences, profile and past purchases and suggest matching accessories, check customers size availability or monitor how long they browsed and offer a digital coupon.

Connected Hangers – While you browse through the racks, real-time reviews are displayed on the hanger, size availability or images & videos displayed on screens showing the garment in use. Retailers can capture how popular an item is but never purchased.  Taking the clothes and hanger try on could provide personalized recommendation on shoes and accessories.

Personalized Mirrors – I recently read an article in Time (Dec 29th) about Rebecca Minkoff’s new store in Manhattan, where they installed a giant mirrored panel showing images of models walking down the runway. The panel acts as a mirror and touchscreen, where shoppers can order up a personalized fitting room, offering style tips based on their selection. This is connected to a mobile app that saves their browsing history and style preferences for their next visit. When a customer is ready to purchase a sales assistant takes payment on an iPad.

In future blog I will discuss how location based services are machine-to-machine technologies are impacting retailers and consumers.

Data Privacy

With so many devices connected and larger volumes of data captured this raises concerns around data privacy and security. In the past year we have seen too many stores on data breaches and retailers. While shoppers are prepared to share more information for relevance they expect you to keep it safe and secure. Retailers must have a solid data governance framework and process in place or risk losing the trust and loyalty of their customers.

Sensor Driven Analytics

The Internet of Things presents retailers with a wonderfully opportunity to understand and engage the customer like never before. However, retailers need to manage the explosion of data available through smarter devices to gain insight into shopper behaviours and preferences and turn into a more rewarding experience for the consumer.

However, before loading an analytics engine they need to ensure the data is clean, connected and safe. Without this any decisions made are flawed and will impact their brand and ultimately the bottom line.

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What Do Your Insured Members Look Like?

What Do Your Insured Members Look Like?

What Do Your Insured Members Look Like?

As I was changing my flight this morning, I needed to make sure that my checked bag made the change as well (because who wants to get to a meeting with nothing to wear but yoga pants and t-shirts?). During the conversation with the gate agent, I was told that the reservation system accessed through a phone call is separate from the flight system that the desk agent had access to. As a result the airport baggage folks had no idea that my flight had changed. The entire time I was working with the gate agent, I kept thinking that they needed a complete view of me as a customer. *I* don’t care that the systems aren’t integrated and sharing information, I only want my bag to make it where I’m going.

The same applies to insurers. Your members don’t care that you don’t have access to their enrollment information when they are calling about a claim. In order to provide better service to your members – you need to be able to get a complete 360 degree view of your members. If you can get a complete view of your insured members while they are talking to you on the phone – that will enable you to give them better customer service. You want to focus on your member’s experiences. This includes strengthening member relationships and fostering high levels of satisfaction to gain member’s trust and easing members’ concerns.

In many insurance companies, getting a complete picture of what each insured member looks like is cumbersome – with one system for enrolling members, another system for member benefit administration and a third for claims processing. These systems may be cumbersome legacy systems designed for an employer-focused market. These legacy systems have been modified over the years to accommodate changing market needs and government regulations. You may be able to access information from each of these systems over time through batch file transfer, reporting against the various systems or having a customer service representative interact with each system separately.

In order to be competitive in today’s marketplace with the focus changing from employers providing the insurance to the individual, you need to provide your members with the best possible service.

Imagine the confidence I would have in the airline that could easily change my flight and re-route my baggage and interact with me exactly the same whether I am speaking to someone on the phone or standing in front of a gate agent. Imagine how much better my customer satisfaction ratings would be as a result.

What do your insured members look like?

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Posted in Business Impact / Benefits, Customer Acquisition & Retention, Customer Services, Data Integration, Data Integration Platform, Healthcare, Real-Time | Tagged , , , , , , | Leave a comment

How to Improve Cross Sell and Customer Experience in Banking

Customer Experience in Banking

Customer Experience in Banking

I recently refinanced an existing mortgage on an investment property with my bank. Like most folks these days, I went to their website from my iPad, fill out an online application form, and received a pre-approval decision. Like any mortgage application, we stated our liabilities and assets including credit cards, auto loans, and investment accounts some of which were with this bank.  During the process I also entered a new contact email address after my email service was hacked over the summer.  The whole process took quite a bit of time and being an inpatient person I ended up logging off and coming back to the application over the weekend.

I walked into my local branch the following week to do a withdrawal with my bank teller and asked how my mortgage application was going. She had no clue what I was talking about as though I was a complete stranger.  When I asked her if they had my updated email address that I entered online, she was equally puzzled stating that any updates to that information would require me to contact all the other groups that held my brokerage, credit card, and mortgage services to make the change. That experience was extremely frustrating and I felt like my bank had no idea who I was as a customer despite the fact my ATM card as printed on it “Customer Since 1989″! Even worse, I expected someone to reach out to me after entering my entire financial history on my mortgage application about moving my investment accounts to their bank however no one contacted me about any new offers or services. (Wondering if they really wanted my business??)

2015 will continue to be a challenge for banks large and small to grow revenue caused by low interest rates, increasing competition from non-traditional segments, and lower customer loyalty with existing institutions.  The biggest opportunity for banks to grow revenue is to expand the wallet with existing customers.  Though times are ahead as many bank customers continue to do business with a multitude of different financial institutions.

The average U.S. consumer owns between 8-12 financial products ranging from your basic checking, credit card, mortgages, etc. to a wider range of products from IRA’s to 401K’s as they get closer to retirement.  On the flip side the average institution has between 2-3 products per customer relationship.  So why do banks continue to struggle in gaining more wallet share from existing customers?  Based on my experience and research, it stems down to two key reasons including:

  • Traditional product-centric business silos and systems
  • Lack of a single trusted source of customer, account, household, and other shared data syndicated and governed across the enterprise

The first reason is the way banks are set up to do business. Back in the day, you would walk into your local branch office. As you enter the doors, you have your bank tellers behind the counter ready to handle your deposits, withdrawals, and payments. If you need to open a new account you would talk to the new accounts manager sitting at their desk waiting to offer you a cookie. For mortgages and auto loans that would be someone else sitting in the far side of the building equally eager to sign new customers. As banks diversified their businesses with new products including investments, credit cards, insurance, etc. each product had their own operating units. The advent of the internet did not really change the traditional “brick and mortar” business model. Instead, one would go to the bank’s website to transact or sign up for a new product however on the back end the systems, people, and incentives to sell one product did not change creating the same disconnected customer experience.  Fast forward to today, these product centric silos continue to exist in big and small banks across the globe despite CEO’s saying they are focused on delivering a better customer experience.

Why is that the case? Well, another reason or cause are the systems within these product silos including core banking, loan origination, loan servicing, brokerage systems, etc. that were never designed to share common information with each other. In traditional retail or consumer banks maintained customer, account, and household information within the Customer Information File (CIF) often part of the core banking systems. Primary and secondary account holders would be grouped with a household based on the same last name and mailing address. Unfortunately, CIF systems were mainly used within retail banking. The problem grows expotentially as more systems were adopted to run the business across core business functions and traditional product business silos. Each group and its systems managed their own versions of the truth and these environments were never set up to share common data between them.

This is where Master Data Management technology can help.  “Master Data” is defined as a single source of basic business data used across multiple systems, applications, and/or processes.  In banking that traditionally includes information such as:

  • Customer name
  • Address
  • Email
  • Phone
  • Account numbers
  • Employer
  • Household members
  • Employees of the bank
  • Etc.

Master Data Management technology has evolved over the years starting as Customer Data Integration (CDI) solutions providing merge and match capabilities between systems to more modern platforms that govern consistent records and leverage inference analytics in to determine relationships between entities across systems within an enterprise. Depending on your business need, there are core capabilities one should consider when investing in an MDM platform. They include:

Key functions: What to look for in an MDM solution?
Capturing existing master data from two or more systems regardless of source and creating a single source of the truth for all systems to share. To do this right, you need seamless access to data regardless of source, format, system, and in real-time
Defining relationships based on “business rules” between entities. For example: “Household = Same last name, address, and account number.” These relationship definitions can be complex and can change over time therefore having the ability to create and modify those business rules by business users will help grow adoption and scalability across the enterprise
Governing consistency across systems by identifying changes to this common business information, determining whether it’s a unique, duplicate, or update to an existing record, and updating other systems that use and rely on that information. Similar to the first, you need the ability easily deliver and update dependent systems across the enterprise in real-time. Also, having a flexible and user friendly way of managing those master record rules and avoid heavy IT development is important to consider.

Now, what would my experience have been if my bank had capable Master Data Management solution in my bank? Let’s take a look:

Process Without MDM With MDM Benefit with MDM
Start a new mortgage application online Customer is required to fill out the usual information (name, address, employer, email, phone, existing accounts, etc.) The online banking system references the MDM solution which delivers the most recent master record of this customer based on existing data from the bank’s core banking system and brokerage systems and pre-populates the form with those details including information for their existing savings and credit card accounts with that bank.
  • Accelerate new customer on-boarding
  • Mitigating the risk of a competitor grabbing my attention to do business with them

 

New email address from customer Customer enters this on their mortgage application and gets entered into the bank’s loan origination system MDM recognizes that the email address is different from what exists in other systems, asks the customer to confirm changes.The master record is updated and shared across the banks’ other systems in real-time including the downstream data warehouse used by Marketing to drive cross sell campaigns.
  • Ensure every part of the bank shares the latest information about their customer
  • Avoids any disruptions with future communication of new products and offers to grow wallet share.

The banking industry continues to face headwinds from a revenue, risk, and regulatory standpoint. Traditional product-centric silos will not go away anytime soon and new CRM and client onboarding solutionsmay help with improving customer engagements and productivity within a firm however front office business applications are not designed to manage and share critical master data across your enterprise.  Anyhow, I decided to bank with another institution who I know has Master Data Management.   Are you ready for a new bank too?

For more information on Informatica’s Master Data Management:

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