Webinar Slides Segment One

Segment of OneCustomer segmentation in retail

banking

28 March 2012

Ronan McCaughey, Editor-at-large, Retail Banker International

Introduction

Amit Dua, Associate Vice President and Head of EMEA, Finacle, Infosys

Davy Warnez,Transversal Portfolio Manager

Business Lines & Group Functions,BNP Paribas Fortis

Amit Dua, Associate Vice President and Head of EMEA, Finacle, Infosys

Segment of ONEFrom Identical Individuality to Individual Identity

Amit DuaAssociate Vice President Head - EMEA, Finacle

Who is the Emergent Consumer of Financial Services?

What key factors are shaping the Customer Engagement model in the banking business?

How should banks Innovate and ensure a Leadership position tomorrow?

Strategic considerations for banks today

Tomorrows Customer has little in common with Todays or Yesterdays

Its About ME!

I Trust Your Advice

You Are Always

Working For Me

Make It Easy For

Me

You RememberWhat I Have Told You

My Experience Fulfils On Your

Brand PromiseYou Fit With My

Lifestyle

I Do Not Need To Tell You

Everything; You Work Out My Needs From Others

You Recognise MyLoyalty

You Stay Out Of My Way Until I Need Your Help

You Understand Me, My Circumstances And My Needs

Paradigm Shift in the Customer Context

Key factors shaping the Customer engagement model tomorrow

Todays Context Tomorrows Imperative

Segmentation based on Demographics, Ethnicity, Geography

Product-Oriented Customer Communication

Traditional Distribution Channels

Usage of Campaigns & CRM

Reactive Decisioning

Segmentation based on Individuals Aspirations, Attitude, Behaviour

Customer-Tailored Product Communication

Modern Tools like Social Media

Usage of Analytics & Predictive Modelling

Real-time Decisioning

Superior customerUnderstanding

Building the relationship is all about offering a Superior Proposition to the Customer

Great Innovation is builtfrom SOFT CUSTOMER

INSIGHTS not data!

LOOK OUTSIDE current environment

Superior product& services

Communication is as important as product and

service!

Superiorcommunication

Superior customerProposition

Customers buy BENEFITS ,not products!

Tesco Clubcard Proactive offers based on transaction behaviour


Facebook places I know where Me is, who Me is with and will give Me and friends, the best possible deal


Understanding the Customer at every stage of the relationship lifecycle

CustomerRetention

CustomerDevelopment

CustomerAcquisition

V

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C

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Evolution of Customer Relation over time

Campaign Performance Management

Lead GenerationPredictive Response ScorePerformance Tracking

Product Holding AnalysisNext Best product OfferingCustomer Migration

Cross Sell,Re-profiling & Product Holding


Recency,Frequency Monetary ScoreChannel PreferencesProduct Usage


Profitability AnalysisCLTV forecasting

Predict Customer Default & Prepayment Track Delinquency movement

Customer Risk Behavior Analysis

Track Customer SatisfactionTrack Service Competency

Service RequestAnalysis

Sentiment AnalysisLogin frequency/ activity

Social & Web Analytics

Attrition ScoreAttrition TrackingLoyalty Profiling

Attrition & Loyalty Analysis


Offering Superior Products and Services

Design

Distribute Develop

Deliver

Customer

Compliance and Regulation

SuperiorProducts & Services

ICICI bank added new customers cost effectively and rapidly via online a/c opening.

DBS bank provided personalized ATM card & cheque book

Agility andPersonalisation

DBS bank gained 360 unified view of their customers across 300 subsystems to provide a superior integrated experience

Disparate customer data to enterprisecustomer insight

Emirates bank bundled product offering

Single input for multiple products

Single input for multiple products

Examples of Superior Products and Service

Maximum usageof Online model

ANZ bank extended several branch- intensive features to online mode e.g. redrawing from home loan

Customer Service InnovationsPowered by Finacle

SuperiorProducts & Services

Achieving Superior Customer Experience is the first step in the journey The journey of a bank in playing the Advisory Role

Product Centric

One size fits all

No differentiation

Simple and uniform pricing

Limited channels and no

differentiation

External

Segment Centric

Segmentation and

grouping based on

homogeneous attributes

Segment based analyzed

pricing

Cross Sell/Up sell

Central

Customer Specific

Customer specific offering

Relationship pricing

Tacit information and online

real time intelligent

interactions

Customer empowerment

Customer experience led

relationship management

Right sell

Partner

THANK YOU

www.infosys.com/finacleThe contents of this document are proprietary and confidential to Infosys Limited and may not be disclosed in

whole or in part at any time, to any third party without the prior written consent of Infosys Limited.

2012 Infosys Limited. All rights reserved. Copyright in the whole and any part of this document belongs to Infosys Limited. This work may not be used, sold, transferred, adapted, abridged, copied or reproduced in

whole or in part, in any manner or form, or in any media, without the prior written consent of Infosys Limited.

Davy Warnez,Transversal Portfolio Manager Business Lines & Group Functions,BNP Paribas Fortis

~3.7 million customers

Mobile banking: first mover in Belgian market

Largest network in Belgium (>1k branches)

~18k employees in Belgium

Belgian market leader

Corporate & Public Banking

Corporate & Investment Banking

Retail & Private Banking

Organized around 3 business lines

Define your marketPartition market into groupsGroups with similar preferencesDistinct from other groupsBig enough to matter Small enough to be cohesiveIdentifiable and accessible

Next steps: Targeting & Positioning

Segmenting - Theory

MARKETS Retail & Private BankingConsumerPRODUCTS PrivateProfessional

Daily Banking

Save & Invest

Lending & Protect

Mass Personalized

Wealth

Personalized Personalized

Classic segmentation value based (e.g. AuM)

Big challenges financial industry:

- Negative perception of financial industry

Big challenges market leader:

- Commoditization => risk of price war - Clients can easily change banks

- Remain main bank (vs niche players)

Part of solution: CUSTOMER FOCUS/EXPERIENCE

- Do not miss new trends/technologies- Become main bank (vs loyal customers)

Motivational segmentation

I seek to build a constructive relationship with my bank/s

I only seek a purely functional relationship with my bank/s

I rely on my bank/s

I challenge my bank/s

Partnership seekers

Dependentfaithful

Distant functionalists

Competent challengers

Motivational segmentation: some lessons learnt

However, difficult to identify (not in dBase)

Inconsistent over all product groups

Thinking from customer perspective

Creation of personas makes it tangible

Focus not only on articulated tangible needs

(Life) event segmentation

Lost & stolen cards Opening/closing customer relationship First salary Marriage/divorce Birth/death

Increase customer satisfaction by reviewing customer journey on key moments

(Life) event segmentation: some lessons learnt

Differentiate service level based on customer value (should remain profitable)

Focus on full experience (pre & post)

It is not all about delight

Buy in from all departments is key success factor

It is measurable, identifiable & actionable

Conclusions

Still mainly classic value based segmentation

Motivational segmentation is for the moment more used as conceptual thinking exercise; life event segmentation easier to implement

Perform sanity check: Measurable

AccessibleActionable

Profitable

Amit Dua, Associate Vice President and Head of EMEAFinacle, Infosys

Davy Warnez,Transversal Portfolio Manager

Business Lines & Group Functions,

BNP Paribas Fortis

Ronan McCaugheyEditor-at-largeRetail Banker

Interactive

This webinar will be available for replay at Retail Banker Interactive from 29 March 2012. You will receive an email containing a link to the webinar slides and recording.

The next webinar in this series is Customer Loyalty- A multi channel approach and will take place on the 25th of April 2012

Please register by following the link on www.retailbankerinteractive.com

Documents

Webinar Slides Segment One