|
 |  |
 |
 Overview Success Stories
|  |
The Royal Bank of Scotland increases return on its marketing spend with Chordiant Marketing Director 
The Royal Bank of Scotland has never shied away from innovation. To combat fraud, the Bank produced Europe's first multi-colored bank notes, pioneered double-sided printing of notes and became the first British bank to laser-etch customers' photographs onto credit and debit cards. It is then perhaps no surprise that the Bank has been one of the leaders in the highly competitive financial services sector in its application of innovative technology to focus more closely on its customers.
Over the last few years the industry has experienced dramatic change with the entry of new players such as privatized building societies and internet banks - all diversifying their financial service portfolios in order to attract business from customers eager to invest.
Leverage CustomerbaseTo maintain its market leading position, The Royal Bank of Scotland recognizes the need to leverage its existing customer base to build closer relationships and to increase the opportunities for cross and up selling. Its aim is to provide more focused and better coordinated campaigns across all of its communication channels including direct mail, statement inserts or outbound calling to suit the specific financial profile of each customer. "Our goal is to coordinate management of customer communications," explains Ian Wilson, head of marketing operations. "As with other banks, our legacy systems were designed for account processing, not communicating with customers." Getting closer to customers meant managing customer marketing campaigns more effectively and creating a targeted, more relevant and ultimately more profitable dialog with existing and prospective customers. Thus the Bank undertook an intitiative that would draw on all of the valuable customer data from the legacy systems and deliver it in a manageable form to the marketing department. "The Bank's business requirements were becoming more stringent and consequently campaign measurement needed to be more precise," says Wilson. After a lengthy assessment and evaluation procedure, which included the possibility of building an in-house system, the Bank selected Marketing Director from Chordiant Software, Inc. "Chordiant Marketing Director is streets ahead of any of the other systems we looked at in terms of available functionality," explains Wilson. Five years later and the Bank is still impressed with the product's capabilities. "It still has all the essential functionality of marketing automation but now has a much broader scope and allows us to be both more efficient and more effective," Wilson continued. "For example it allows for much cleverer segmentation of our data which enables us to put focus on particular groups of customers. And the more you do in this area, the more challenging it becomes", he says. "Who do you talk to, how often, about what, when, in what way?" The software currently handles 3.5 million customers holding some 5.5 million accounts. With the original implementation, The Royal Bank of Scotland was able to carry out all centrally driven direct marketing activity, including targeting and selection for campaigns and the maintenance and use of a consolidated contact history. The database would also support broadcast activity and be used to store response data from various campaign activities. Different Creative Messages "The initial stage of the project was to focus on direct mail and was very successful," says Wilson. "It was up and running in less than six months and used for a wide range of customer marketing activities such as pre-testing creative treatments for direct mail. The capability to analyze responses by cell allows us to evaluate the impact of different creative messages and select the most effective for rollout during the main campaign." The effectiveness of the marketing automation system is being measured against fulfillment of four key criteria. The Bank wants to: improve its customer view, better measure its marketing activity and get a handle on the effectiveness of its spend, automate regular "event" activity and test both creative and targeting approaches in a more sophisticated way than it could previously. "What the tools help us to do is deploy strategy based on a business-driven view of the market." Greater Campaign Productivity Wilson says that the marketing departments are running many more campaigns with some 14 million contacts (including statement inserts) per year. Typical mailing campaigns might be around 100,000 and, says Wilson, "The number of undeliverable pieces have plummeted and we have achieved response rates of more than 10 per cent. But now what this system allows us to do is to be much cleverer in our campaigns. We can have event-triggered campaigns that may number from 1000 down to only a handful. It is not unusual to get response rates in excess of 25 per cent." But he says it is not just about response rates. "It is about getting return on our marketing investment. And by getting a better quality contact, we are getting better quality response," says Wilson. Another key advantage is the ability to co-ordinate different campaigns. "It may be that a response to one campaign solicits a response to another and we can now deal with that. It may also be that one campaign has the effect of cannibalizing other products. It may also be that a customer wants to exclude themselves from our campaigns, and again we can easily accommodate that. Also if a customer doesn't bite after a couple of mailings, rather than bombard them with mail we can hold back for a few campaigns. What we are looking to do is grow the value of the customer over time." All of this has been achieved with half the number of operational marketing staff than were previously involved. Piloting E-Mail Communication The company is now piloting e-mail communication with customers. "This creates a number of business issues which need to be addressed very seriously," says Wilson. "It is a much more real-time form of communication and we need to be equipped to deal with that, particularly the non-standard communication." "If a customer inquires about a product online, they may raise a number of technical issues and we need to have the back-office capability in place to deliver that. It really isn't as simple as some people may like to think but we have always had our eye on new communication chan-nels throughout this project and we see great potential here." The tracking of response extends beyond the customer base as well says Wilson. "We are able to track response to press campaigns in great detail which has allowed us both to monitor the impact of the activity and proactively manage the media schedule in terms of selecting which executions and publications have generated the best levels of response. This gives us a better handle on what campaigns are achieving and what we can improve," says Wilson. Revenue is not restricted to new business; the system is also used to enhance service levels for existing customers. A number of regular event-driven activities based on product life cycles have been introduced with the objective of improving retention. "With some customers the focus is on service because they are already good customers with a range of products and so the focus is on retention not necessarily cross selling," he says. Understanding Direct Marketing A common stumbling block when introducing new technology into non-IT areas of the business, such as marketing, is the synchronization of the technology potential and users' expec-tations. According to Wilson, it is critical to work with a vendor that understands direct marketing is essential. "If you're dealing with a company whose thinking is not in line with yours, problems are inevitable." Allen Swann, Chordiant's President of Worldwide Field Operations said, "The Royal Bank of Scotland realized long ago that the marketing function needed to be more accountable, targeted and effective, and to do that they needed a flexible solution that would fit their unique business processes and data. They started their journey towards a complete operational business process solution by implementing Chordiant Marketing Director, and have now expanded that to an enterprise-wide solution that orchestrates and automates their every customer interaction. This J2EE based solution will allow them to develop highly personalized customer profiles and make these immediately available across the enterprise." Wilson believes the goal of the coordinated campaigns and better customer relationship management is straightforward: "The key is learning more about our customers," he says. |  | |
 |
| © 2000-2008, Chordiant Software, Inc. All rights reserved. Legal/Disclaimer | Privacy Policy | Site Map | |  |
| Solutions | Retail Banking | Card Services | Lending | Insurance | Telecommunications | News & Events | About Chordiant | |
