Customer-centric technology
Article Abstract:
The strategic use of the right technology is crucial to a bank's continued success. Banks must be able to utilize technology to develop a new business model of banking, instead of using it merely for piecemeal automation, to achieve the level of organizational agility, responsiveness, efficiency and service quality necessary to outperform the competition. The new retail banking model involves a multiproduct, cross-channel service and sales capability that is effectively coordinated and efficiently tailored to the unique needs of individual customers. Laying the foundations for this model presents three management challenges: modifying bank marketing and sales approach to allow the provision of custom products/services, customer focus and multiple robust delivery channels; shifting information and systems architecture to the hub-and-spoke approach; and placing greater importance on flexibility and customer-tailored solutions.
Publication Name: Banking Strategies
Subject: Business
ISSN: 1091-6385
Year: 1997
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Deposit wars
Article Abstract:
The main culprit behind decreasing bank deposit outflows is eroding consumer deposits and not account terminations as commonly assumed. A study shows that defectors, defined as clients who close their accounts, are responsible for only 20% to 25% of the deposit erosion while diminishers, those who lower their balances, account for 75% to 80% of the erosion. Therefore, banks would do well not to focus their attention on defecting households and concentrate on high-balance customers who do not defect but reduce their balances, who make up the most profitable segment of retail banks' market. The aforementioned study indicates that these diminishers are dissatisfied with investment returns, are unsatisfied with fees or feel that they do not have enough access to real financial support. Guidelines for marketing to this customer segment are discussed.
Publication Name: Banking Strategies
Subject: Business
ISSN: 1091-6385
Year: 1998
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