Channel strategy, v1, 2011

MULTI-CHANNEL APPROACH FOR
FINANCIAL INSTITUTIONS

Presented by: Kevin Chetty
Commercial Director

‘ Strength lies in Differences NOT Similarities’ – Stephen Covey

‘The achievement of an organisation are the results of the
combined effort – Vincent Lombardi

 Topic
 Presenter
 Delegates
 Workshop Ground Rules
 Workshop Expectations & Objectives

4

 Day 1
 Session 1: Customers, Landscape, Strategy
Case Study & Exercise

 Session 2: Mobile Strategy (Mobile Sales Strategy & M – Commerce)

 Session 3: Branch Strategy

 Session 4: Alternative Strategy

6

SESSION 1: Customers, Landscape, Strategy

The Alchemist – Paulo Coelho

“It’s the possibility of having a dream come
true that makes life interesting”

1. Background

RETAIL BANKING A REALITY

The traditional retail bank is at an inflection point. The needs
and expectations of customers are changing as quickly as the
competition. Customers are demanding seamless, multi-
channel sales and service experiences. Simultaneously, other
financial institutions and non-traditional players are looking
for opportunities to invade this space or to redefine it
through disruptive innovation.

The result is forcing banks to examine a more balanced,
integrated approach to customer experience and growth

9

1. Background

AN EVOLUTION FIND YOUR SPACE

10

1. Background

THE CHANGING FACE OF BANKING
In view of several developments in the 1990’s, the banking industry is changing
…
Global banking more competitive
The IT revolution
Information explosion
Rationalisation of branches in 1990’s
Banks are trying to become one-stop financial supermarkets

How did banks respond?
o Distribute financial services through other ways and channels
…
o … proliferation of non-traditional banking channels
o Growth in usage of MOBILE selling agents

1. Background

A COMPETITIVE LANDSCAPE eg SOUTH AFRICA

Market landscape
Banking environment Key macro econ trends
Competitors becoming
Macro economic
increasingly aggressive
environment outlook is
Alliances and joint ventures
moderate

Customers
Use a wide range of Regulation
financial products Tier 2/3 legislation
Proliferation of National Credit Act
distribution Competition
alternatives Commission
Lower commission
earnings

1. Background

WHAT DO CUSTOMERS WANT? NOT WHAT BANKS……

Booz Allen’s consumer research reveals that despite the development of
alternative channels, customers still prefer to purchase in the branch.
However, the importance of the branch is in decline, and the mass
affluent form the group leading the march away from branches, and
towards mobile banking, mobile sales force and the Internet. When it
comes to alternative channels, customers prefer online to telephone
transactions, particularly when the product and the transaction itself are
relatively simple. One area in need of significant development is the
mobile sales force, which at present is limited or nonexistent in all but a
few countries.

Source: Reference Booz/Allen/Hamilton - Striving for Growth, Best Practices
in Retail Banking Sales and Service Channels

13

1. Background

RAISING THE GAME IN RETAIL BANKING

Booz Allen’s research shows there are clear opportunities to enhance revenue
in retail banking. Going forward retail banks need to:

o Provide dedicated channels (website, call centre, mobile sales forces and
specialist areas in branches) for affluent customers.
o Reduce waiting times in branches through the use of welcome desks
(concierge concept) and the option of making appointments in advance.
o Efficient call centre menus and staffing that enable customers to quickly
reach people who can resolve their queries.
o Enable customers to tailor websites, supported by strong security
measures (e.g. random number generators).
o Offer mobile sales advisers who can complete transactions at the meeting,
for selected customer groups.

Source: Reference Booz/Allen/Hamilton - Striving for Growth, Best Practices in
Retail Banking Sales and Service Channels

14

1. Background

THE CURRENT BANKING LANDSCAPE

• It has been almost 3 years since the Global Financial Crisis

• The current banking environment is a lot different to a decade ago

• Branches have been rationalized

• There is consolidation

• Current focus is on Capital Adequacy & stringent Central Bank requirements

• Growth is immanent (Organic vs. Inorganic growth)

• Greater demand from customers

• Development of various channels

• BUT it will be about RISK, COSTS, EFFECIENCY, LEVERAGE, JV’s, M&A’s

1. Background

CHANNEL STRATEGY
• For businesses to survive Growth is imperative

• A Channel Strategy is amongst the most enduring decisions a company will make

• Why companies adopt or embrace a channel strategy is often related to their
growth prospects, need for new customers and an increasing competitive landscape

• The world in which we practice, trade or market our products have considerably changed

• The economic woes in the last few months’ have been catastrophic to say the least

• The global financial meltdown has restricted and impacted growth in many countries and companies alike, including Africa

• However, we are beginning to witness a turn for the better in the economic cycle

• Whilst this is positive news, BANKS must select a channel carefully when considering to distribute products or services

• A correct channel strategy comes through a correct Segmentation Strategy

• The appropriate channel should be assigned to each customer segment. The challenge for companies that opt for a ‘multi-channel’
approach is knowing how to orient each customer towards the channel that best fits its profile. It is equally important to analyse
each channels costs and profitability, as it is to analyse the cost and profitability of each customer in each channel.

• The growth of new channels such as the internet or mobile phones has redefined or changed the game in many sectors.

1. Background

KEY BENEFITS IN DEFINING A CHANNEL STRATEGY

• Increase in sales

• A targeted market coverage

• Minimize sales expenses as the strategy and channels are defined

• Capture EXISTING markets and acquire NEW markets

• Keeping abreast of the competition

• Increase to the existing client data base

1. Background

KEY CAPABILITIES
• Create new alternative channel programs

• Improve competence and commitment of direct and in-direct channels

• Sales force sizing based on each channel

• Driver for committed and competent partners

• Hybrid channels

• Direct vs. In-direct distribution channels

• Indentifying and recruiting the best channel partners

• Managing channel conflict

• Compensation (incentives, commissions) and channel finance

• Measuring the channels success

1. Background

DEFINE

DIRECT CHANNEL:

Those channels where there is direct control

IN-DIRECT CHANNEL:

Those channels where there is NO direct control over the channels

1. Background

DIRECT vs. IN-DIRECT CHANNELS
Direct Type Description Strengths Weaknesses
Channel Channel
Electronic Internet Company internet site. Most Most consumers have access If the internet is NOT user
channels can be linked to the to PC/internet zone. Cheaper friendly, navigation can
internet, depending on the channel as most traffic is via become tedious to
PUSH/PULL strategy. Internet the consumer/client. Clients frustrating. Hence ease of
must have access point for have access to wider access is crucial
prospective clients. This must be information
linked to a central email address,
finally to a central data base.
Direct email to Sending direct mailers to a Most businesses have Dependant on the reliability
prospective/identified customer access to email. It is more of email address provided.
base. This involves a BTL cost effective. There is NO Consumers can become
campaign message. Data base delay in the release and overloaded with so called
that has accurate information is receiving of information. junk mail.
KEY. Campaign messages can be
tailor made and using multi-
media (e.g. Saleslink)
Direct email Receiving an email from a It is cost effective via a client. Not responding on time
from prospective customer. Linkage to a Furthermore, increases the (with 24/48 hours)
central email address and data success of closure
base
Telephony Telemarketers Outbound and Inbound. Using Competitive advantage Can become very costly if
defined CRM/IT platform for all through a centralized implemented incorrectly.
sales and information sharing. In approach, company controls Clients are inundated with
addition, low key desktop call value chain. Hence, reduce calls thus increasing caller
centre can be set up. other operational frustration. Poorly trained
costs/infrastructure Telemarketers can damage
reputation. Furthermore the
conversion ratio is low
Telephone Automated recording of a message Cost effective Can become frustrating to a
Automated customer, if the message is
NOT responded to.
SMS Must be linked to a dedicated call Cost effective and can be Can become costly to
centre, so that the response is used effectively in customer manage if implemented
immediate. This will improve the follow-ups, e.g. birthdays, incorrectly. Message
customer service image thank you etc contents has to be small
IVR Interactive Voice Recorders. Reduced overhead costs Can become very costly for
Automated interactive system with associated with staff. Helps a company. Can prove to
a caller. Both inbound and improve sales and frustrating for a consumer
outbound information gathering
Post Direct Mailers Campaigns in most retail segments If the campaign is well Can become costly and
driven through direct mailers. packaged, the ineffective due to post
These are tailored messages for conversion/response rate is delays
the intended recipient higher
Magazine Campaigns and information on a Stuffers are placed in Can become costly if the
Stuffers company/product is placed in strategic magazines with a response is very low to NIL
certain magazine/s direct focus on a target
market

1. Background

Face 2 Walk-in and Customers that simply walk-in or The company has an active This is dependent on the
Face Referrals referred by a client. This is person to engage with and marketing strategy and the
dependent on the PUSH/PULL sell a product brand equity. IOW the
marketing strategy product is TOP on mind
Direct Sales Employing agents to fulfill sales Direct activities are most Niche industries DSA’s
Agents effective in a high volume become more difficult. Can
employed by industry type be very costly. If NOT
company effectively trained can
damage a brand. RISKs
such as fraud
Media BTL These are much targeted They have proven to be more They are costly if planned
Campaigns campaigns on a specific data successful due to the incorrectly
base/segment. These include Print, focused strategy. Planning is
TV, and Radio. The campaign done in advance so as to
message must be segmented and ensure costs are curtailed or
implement over a defined 12 month maintained. This gives
campaign period. Including companies the competitive
breakfast and conferences. advantage and increase in
organic growth
Other Fax Fax to email is the most For companies that have NO Quality of information
appropriate process email or are responding to a
campaign
Interactive Kiosks that are designed for a Reduce people, Can become very costly
Media Kiosks company and have an interactive infrastructure costs.
link to a company/website/email Embracing innovative
technology gives you the
competitive advantage. Place
at strategic points, e.g. SME
Banks
Interactive TV Using TV as an interactive medium. Reduce people, Can become very costly
Used in game shows etc infrastructure costs.
Embracing innovative
technology gives you the
competitive advantage
Social Media Twitter, Facebook. These have Cost effective. Used by a ?
become leading interaction sites for wider audience, hence
business people. captive audience. Can create
blogs and interactive
linkages for your company.
Hence, groups of people will
apply

1. Background

IN-Direct Type Channel Description Strengths Weaknesses
Channel

Electronic 3rd Internet Sites Information is flagged on 3rd party Increase marketing Linkage to company site
rd
sites. Usually 3 party sites have exposure must be agreed upon.
close similarity to a company or Reliability of 3rd party site
engage in business with a
company
Telephony Outsourced The entire outbound and inbound Reduced infrastructure and Can become very costly.
Telemarketing call centre is outsourced resource investment. Most May NOT receive
effective if a RISK vs. dedicated support as the
REWARD model is used outsourced partner may
have other clients
Post Knock n Drop Outsource the drop off of flyers or Capture a wider target Company personal may
leaflets or newsletters market. Limit the use of NOT drop off all the flyers
internal resources or leaflets. Conversion is
very low
Regional Surveys Have door to door surveys. In the Control and monitor Interviewer biasness
form of a questionnaire responses

Face to 3rd Party Direct Outsourcing the sales and Works well if a risk vs. Reputational risk
Face Sales Agents marketing function. This is one of reward model is used.
the biggest emerging trends Reduced labour associate
world-wide. Commission driven costs. Increased speed to
roll-out
Partners/Associate Establishing a network of deal Increase geographical Reputational risk
Companies makers regional or country-wide. reach and access to NEW
This can be individuals and customers
companies. Commission or % of
driven
Media Trade Shows Coordinated by an external field Can undertake more trade Quality of leads or
through 3rd Parties marketing company. Gathering of shows in a given month, information gathered.
information or data. This will be quarter, year. Costs can be high
used for prospecting. Important
for ATL Brand Equity
ATL Campaigns Includes Print, TV, and Radio. A Results can be very positive Costly and time
very important constituent for long term. However, this is consuming
Brand building or Brand Equity linked to defined
creation campaigns. Great for the
PUSH strategy
Other Joint Ventures Forming an alliance with a Increase organic growth Can fail if the objectives
company that has similar very quickly. Increase and vision is NOT shared
philosophy or capability to fulfill a geographical footprint. Very
sales channel function effective for Retailers.

1. Background

CHANNEL COST EFFECIENCY vs. VALUE ANALYSIS

Face to Face The success for most channels centres on a company’s ability
Website for interaction to achieve balance between the variable or fixed costs drivers,
High information and the value the end user gains in using the respective
channel. Hence, the above model is a good schematic view of

IT
the Cost Efficiency vs. Value to an end user. It can be applied

O
DO
when making respective channel decisions. In addition, it
highlights three critical decision paths:
F
OF
E

Avoid IT: this is attributed to low cost efficiency and low end user
AD

Med
value, e.g. interactive TV
TR

ium
TRADE OFF: has medium cost efficiency and medium value to
a client, e.g. direct sales agents. Business must take a strategic
decision
IT

State of art Call DO IT: has high value and high cost efficiency drivers, e.g.
D
OI

Low Centre company website
AV

Low Medium High

Value to the User

1. Background

COST BREAKDOWN PER CHANNEL
Direct Type Description of Cost Drivers Cost per Driver Total Cost
Channel Channel
Electronic Internet • Service provider monthly cost
• Line rental cost
Direct email to

Direct email
from
Telephony Telemarketers

Telephone
Automated
SMS

IVR

Post Direct Mailers

Magazine
Stuffers

Face 2 Walk-in and
Face Referrals

Direct Sales
Agents
employed by
company

1. Background

CHANNEL CAPACITY
Direct Type Mgr/ No. PC Laptop Printer Scanner Fax Tel
Channel Channel Sup Staff

Electronic Internet

Direct email to

Direct email
from
Telephony Telemarketers

Telephone
Automated
SMS

IVR

Post Direct Mailers

Magazine
Stuffers

Face 2 Walk-in and
Face Referrals

Direct Sales
Agents
employed by
company

1. Background

CHANNEL PRODUCTIVITY
IN-Direct Type Channel Productivity Measurements Conversion Ratio %
Channel

Electronic 3rd Internet Sites No of hits/responses

Telephony Outsourced Measured against Prospects
Telemarketing vs. called vs. converted
appointment. Call centre will
keep a tracking sheet.
Post Knock n Drop No of responses via a
selected channel. Prompt
customer to use email/call
centre
Regional Surveys Measure number of
applications filled in an area.
Info is captured onto a data
base.
Face to Face 3rd Party Direct Sales Measured against target vs.
Agents achieved. In addition
measure achieved vs. comms
paid out.
Partners/Associate Measured against set targets
Companies per month or quarter. Pick
this up on the comms paid
Media Trade Shows through No of people that visited
3rd Parties stand, from details filled on
customer visit form. This info
is captured onto data base.
Use Call centre to follow-up
ATL Campaigns Depending on the medium
measure against info sent vs.
customer’s response. Prompt
customer to use email/call
centre
Other Joint Ventures Depending on the agreement
i.e. partnership

1. Background

COMPARITIVE INCOME

D & ID Electronic Telephony Post Face 2 Media Other
Face
Sales:

Operating
Expenses:

Nett Effect

1. Background

CHANNEL SELECTION MATRIX FROM A CASE STUDY

1. Background

PROCESS MAPPING/MANAGEMENT

1. Background

IMPLEMENTATION STRATEGY BASED ON MY
EXPERIENCE

1. Background

THE 6 DYNAMICS CUSTOMER FOCUS
In the EVOLUTION of retail banking channels, the 6 dynamics are critical to developing
effective CUSTOMER FOCUSED strategies:

• Branch generated revenue growth is becoming more challenging

• Transaction processing and customer services are becoming increasingly
independent of the branch channel

• Customer demographics are shifting

• New technologies are gaining widespread adoption, allowing customer relationship
management to become channel independent

• Changes in the regulatory environment are altering the playing fields

• Banks must prepared for overlapping competition (Non-Banking Entities)

1. Background

OVERVIEW

MOBILE SALES CHANNELS

MOBILE E-COMMERCE

1. Background

MOBILE SALES CHANNELS

MARKET OVERVIEW: DEMOGRAPHICS CASE STUDY
Diverse distribution and concentration of Target Market population
R3k-R24,999 (CMM) R25k-R39,999 (RA)
Provinces National Total (000's) R0-R2,999 (ELB) (000's) Occupation National Total (000's)
(000's) (000's)

Eastern Cape 4,616 14.8% 3,913 17.3% 641 9.6% 6 3.6% Occupation, Administrative & 673 2.2%
Managerial

Free State 2,000 6.4% 1,571 7.0% 298 4.4% 6 3.4% Occupation, Agriculture 1,101 3.5%

Gauteng 6,402 20.6% 3,677 16.3% 2,029 30.2% 102 58.8% Occupation,Artisans & Related 1,047 3.4%

Kwazulu Natal 6,363 20.5% 4,725 20.9% 1,348 20.1% 26 15.0% Occupation,Clerical & Sales 2,743 8.8%

Limpopo 3,347 10.8% 2,659 11.8% 388 5.8% 8 4.5% Occupation, Not Active 18,531 59.6%

Mpumalanga 2,315 7.4% 1,730 7.7% 471 7.0% 10 5.8% Occupation,Production & Mining 2,061 6.6%

North-West 2,222 7.1% 1,707 7.6% 419 6.2% 2 1.1% Occupation,Professional & 1,551 5.0%
Technical

Northern Cape 770 2.5% 622 2.8% 120 1.8% 3 1.5% Occupation, Service 2,579 8.3%

Western Cape 3,071 9.9% 1,970 8.7% 996 14.8% 11 6.2% Occupation,Transport & 709 2.3%
Communication

Totals 31,106 100% 22,574 100% 6,710 100% 174 100% Occupation, - Other 113 0.4%

Totals 31,108 100%

Provinces with the highest
distribution ALL segments:
• Gauteng
• KwaZulu Natal 59,6% Not Economically Active
• Western Cape
Source AMPS2007B
35

MARKET OVERVIEW: ECONOMICS

Growth slow down and upward Inflationary pressures
Real GDP growth Overview of 2007
6
 In 2007 the economy continued to perform strongly with real GDP
growth coming at 5,1% after the 2006 growth rate was revised upward
5 to 5,4%.

4
 The services sector, in particular the financial, real-estate and business
services sector made the strongest contribution to growth towards the
%3 end of the year as banks’ balance sheets and revenues continued to
grow at a rapid pace.
2
 After remaining stable in the first half of the year, interest rates were
1 hiked further in the second half of the year on the back of rising
inflation.
0
2000 2001 2002 2003 2004 2005 2006 2007 2008  Interest rates were raised by a total of 200 basis points between June
and December, and together with the implementation of the National
CPIX Inflation and Interest Rates Credit Act (NCA), caused demand for credit to gradually taper off
18 towards year-end.
16 Prospects for 2008
14  Economic growth is expected to slow down further in 2008 on the back
12
of rising interest rates, infrastructure (electricity) constraints, and a
struggling household sector.
% 10
8  A slowing US economy and the impact this will have on world growth,
will also cause lower real GDP growth in South Africa, projected at
6
3,4% in 2008.
4
2
 Inflation is forecast to be under strong upward pressure for most of the
first half of the year as a result of movements in oil and food prices,
2000 2001 2002 2003 2004 2005 2006 2007 2008 and the rand exchange rate.
CPIX inflation rate Prime interest rate
 Interest rates are projected to rise another 50 bps in June, remaining
stable in the rest of 2008 in an attempt to keep 36
inflation and inflation
expectations under control.

ABSA FOOTPRINT IN SA GEO-SPATIAL MAPPING

37

Purpose: To grow the access of
Purpose
sales & service within NICHE
markets, through dedicated
external sales teams at the

MOBILE SALES FORCE BUSINESS MODEL
worksite, at place of
convenience or on the
phone………
In house or out sourced

Direct Sales
WPB Business External Sales & and Service
Development Operations Channel for the niche
Support markets, The purpose of WPB Business
Development is to aggressively
grow the number of schemes,
active portfolio growth and B2B
Key Account Relationship Teams B2B

other business units e.g. ELB via ML
To provide access to sales & service
Finance

Joint Ventures / New Opportunities
to increase the number of schemes

relationship management

LG: Retail Affluent & Investment

Appointment/Diary Management
through Points of Presence at

Sales & Operational Support
Customer Value Proposition/

LG: Islamic Consultants

LG: Core Middle Market
Marketing

Outbound Sales Teams

Inbound Sales Teams
The purpose of Ext Sales &
designated worksites

Management Team
Operations is provide an external
Human Resource sales force for niche markets at

Consultants
the worksite, at home place of
convenience or distribution
Delivery Solutions channels (ESP)
& Innovation The purpose of Direct Sales and
Service is to optimise the use
of a dedicated call centre for
acquisition, cross-sell and
support to the external sales
team. A CRM approach will
be adopted, with an out-sourced
or in-house approach

Development of compelling value propositions for the WPB external
CVP/Commercial LEAD GENERATOR
sales teams focusing on worksites, niche markets and aggressive SEGMENTED APPROACH
Management
acquisition

END TO END CAPABILITY with DEDICATED focus
NICHE markets

38

MOBILE FORCE SEGMENTATION MODEL

Segment specific focus MS force spread over 10 Provinces
Contract
Market Total FTE
LG Designation Product Focus (Outs – 3rd
Segment Comp. (ABSA)
Party)
Retail •Investment Products
MS: Acquisition Banker Affluent •Retail Affluent Transactional Products 100 100 0
•Unsecured Lending Products
Islamic •Shariah compliant Transactional and
MS: Islamic Banker investment Products 85 85 0
•Shariah compliant Vehicle Finance
Core Middle •Transactional Products
Market •Unsecured
MS: Core Middle •Lending Products 296 139 157
Market Focus •Investment Products
•Value Add, e.g. Telephonic Banking

LG: Entry Level Entry Level •Transactional Products ESP: 450
Banking Focus – Banking •Unsecured Lending Products
(1) External Sales •Investment Products Mobile
Points (linked to •Basic Insurance Products Units: 54 0 504
Branches) •Value Add, e.g. Telephonic Banking
(2) Mobile Sales Unit
(Unbanked Focus)

TOTAL MS 985 324 661
GRCB Lead Generator
Conference, London, 18 & 39
19 May 2008

CUSTOMER SEGMENTATION MODEL

Entry Level Banking up to Retail Affluent Segment

Wealth Absa retail acc
R15m NIA customer base2
Private Bank
R650 000 pa

Retail Affluent
RA
R300 000 pa
290 969
Prof’s
63 400
New to bank customers

Staff
49 629 R120 000 pa
CMM
3.6m
f
af

Se
St
M

th

n
LS

io
u

Core Middle
Yo

r s
n/

Market Seniors
io

1.32 m
at

Students R36 000 pa
Students
ti c

105 000
is
ph

Youth
so

490 000
al

Entry-level banking
i
nc

ELB
na

3.79m
Fi

New to bank customers
GRCB Lead Generator
Black diamonds
Unbanked
Conference, London, 18Lending
Micro & 40
Note: 1
Source: Primary Bank Relationships – Amps ‘07 19 May 2008
2
Source: Absa Internal reflecting all relationships: Dec 2007

OUTSOURCED RECRUITMENT MODEL
Conventional sourcing methods
Unconventional sourcing methods
• Within Absa Bank
• External Sources
• Leveraging brands ADCORP
CV
Order
confirmation
Sourcing
Walk-In / First-line
Labour
Telephone screening
Broker
Resource pool
management
Adcorp
alliances

Voice
Assessments Competency
Interview recognition Credit Checks
(SHL, Hrsmart) based interview
assessment

Request CM / Cultural match
Request red list Client interview Induction
ED / Ref Checks interview

Workplace
FAIS
Placement preparedness
accreditation
Quest training
incubator 41

TRAINING

Mobile Sales Force Academy : Lean Curriculum- 5 day Programme

Day 1 Days 2 and 3
Absa Socialisation (high level) Business Simulation
Absa Compliance and testing encompassing Sales, Service, Products
and Process

Days 4 and 5
Regulatory Training
(NQF 4 and 30 Credits)

According to Financial Services Board the regulatory pre-requisite for this role is the NQF 4 and
30 credits. Money laundering and Sanctions are compulsory prior to contact with the client.

42

MOBILE SALES CAPABILITIES & DEPLOYMENT

Segmented Distribution Channel focus providing multiple options of delivery
Entry Level Entry Level Workplace Banking Banks on Wheels
Banking Banking Kiosks (BOW’s)
External Sales Points Mobile Sales Units Focus: Worksites Focus: ELB and CMM
(ESP’s) (MSU’s) Core Middle Market at Events, Worksites,
Focus: Branch Hot Spots Focus: Townships Branch Support

Comprises: Comprises: Comprises: Comprises:
•Gazebo •Mercedes Sprinter •Large Kiosk •VW Crafter
•Digital pens (2) •Gazebo •Generator •Generator
•POS device •Generator •Remote opening kits (2) •Combination TV and Video (CET)
•Tables (2) •Combination TV and Video (CET) •Digital pens (2) •PA System
•Chairs (7) •Remote opening kits (2) •POS device •FBSS Workstations (2)
•Marketing materials •Digital pens (2) •3G printer/Fax/Scanner •Fully functional ATM
•Promotional materials •POS device •Marketing materials •Marketing materials
•Card and Pin Mailers •Tables (2) and Chairs (7) •Promotional materials •Promotional materials
•3 DSA’s per team •Marketing materials •4 FTE’s per BOW
•Team Based Targets and •Promotional materials •Chairs and Umbrella’s
Incentives •Training ATM
•6 DSA’s per team

Functionality: Functionality: Functionality: Functionality:
•Account opening •Account opening •Account opening •Account opening
•Basic Enquiries •Basic Enquiries •Basic Enquiries •Basic Enquiries
•Mini Statements (future) •Mini Statements (future) •Mini Statements 43
•Mini Statements
•Prepaid purchases (future) •Prepaid purchases (future) •Prepaid purchases •Prepaid purchases

ABSA MOBILE CHANNELS

44

COMPETITORS MOBILE CAPABILITIES

45

MOBILE BANK ON WHEELS (BOW)

46

TAKING BANKING TO THE PEOPLE

DAVEYTON

47

SALES FULFILLMENT PROCESS

High level sales fulfillment process
LG makes LG meets or LG interviews customer Customer accepts the proposal/s and
contact with or interacts with for sale: Connect, completes the application forms, Record
START sets up an customer and Needs analysis, of Advice and obtains all supporting
appointment prompts the present solutions documentation. Customer signs all the
with customer customer to handle objections and required documents (Close the deal).
disclose financial cross sell *If available - issue card and pin mailer
request/need

SS captures the SS screens SS checks quality Sales Support clerk LG forwards all of the
Record of Advice customers against and compliance (SS) receives the documents through to the
online and CASA and opens adherence of all documentation and Sales Support clerk at the
executes all other account on FBSS documentation records deal in Sales Support Hub/branch
administrative register/DSAS
duties

SS calls the LG / customer Customer LG monitors LG sends original
and informs them that the encouraged to progress of account documentation to
account has been opened. Activated
activate account activation and Hub/branch
Account no provided. account
Update records in updates verified &
register / DSAS commission claim Commission
form once account paid to LG
is activated

48

COMPENSATION STRUCTURE
Fixed Salary R 3000 / £194
LG (ELB)

Commission per Prod Team based targets

Other Commission None

Products sold Transactional Unsecured Lending

Investments Basic Insurance

Commission payable per LG 100% to target (195 NET
Team products per team), R3000
per LG

Quarterly Bonus None

Quarterly Incentive (stretched 110% to target ( 216 NET products per team), R3000 per LG
target) 125% to target ( 243 NET products per team), R9000 per LG

OTE Monthly Ave Salary R7000/ £467

Fixed vs. Variable 43%
remuneration split

49
OTE: Opportunity to Earn

COMPENSATION STRUCTURE
Fixed Salary R3000/ £194
LG (WPB, Core Middle Market)

Ave Commission per prod R122 / £ 8

Other Commission R1000 / £ 65 for Value %
Achievement 100% to 124%
Products sold Transactional Savings & Investments

Unsecured-lending Value Adds

Commission payable 100% to target (60 NET
products pm), R8000 for
Volume and R1000 for value

Quarterly Bonus R8000/ £517 VOL (125% to target)
R4500/ £291 VAL (125 to target)
R11000/ £712 VOL (150% to target)
R9000/ £582 VAL (150% to target)

Quarterly Incentive (stretched None
target)

OTE Monthly Ave Salary R 10 320/ £ 688

Fixed vs. Variable 29%
remuneration split
50

COMPENSATION PHILSOPHY

COMPENSATION PROGRESSION CHART

30000
COMMS RAND VALUE

25000

20000

15000 RAND

10000

5000

0
LG (ELB) LG (WPB) LG (ACQUISITION
BANKERS)
LG SEGMENTS

• Allows for progression from ELB
segment to Retail Affluent
segment
• Succession planning for MS
• OTE: Opportunity to Earn as MS
performs

PRODUCTION VOLUME - QUARTER 1 PERFORMANCE

Overall substantial increase in Performance – Cumulatively 112% to Target
Jan Feb March YTD - Q1
Active Active Active
Actual Target Sales Actual Target Sales Actual Target Sales Actual Target
Staff Staff Staff
WPB 3,624 1,875 113 6,431 5,008 120 5,977 9,569 130 16,032 16,452

AB 2,799 1,509 89 2,734 3,897 101 2,409 5,565 101 7,942 10,971

IB 1,037 1,219 61 902 2,461 63 2,393 2,817 70 4,332 6,497

ELB 24,130 13,365 540 38,092 26,059 749 33,903 38,052 804 96,125 77,475

124,43 111,39
Total 31,590 17,968 803 48,159 37,424 1,033 44,682 56,003 1,105
1 5

TOTAL
Keys:
ELB
• WPB – Workplace Banking
IB
• AB – Acquisition Bankers
• IB – Islamic Bankers AB

• ELB – Entry Level Banking WPB

NB: Productivity Includes 0 GRCB
20,000 Lead Generator
40,000 60,000 80,000 100,000 120,000 140,000
Value Added products Conference, London, 18 & 52
Actual
19 May 2008 Target

PRODUCTIVITY RATIOS - QUARTER 1 PERFORMANCE

Average Product Volume Trends Positive – sound monthly product volumes per MS
YTD
Jan-08 Feb-08 Mar-08
AVE

Average Volumes sold per day per MS (WPB) 1.5 2.6 2.4 2.1

Average Volumes sold per day per MS (Acquisition Banker) 1.4 1.3 1.3 1.3

Average Volumes sold per day per MS (Islamic Banking) 0.8 0.7 1.8 1.1

Average Volumes sold per day per MS (ELB) 2.0 2.4 2.2 2.2
Total Ave Product numbers sold p.m. per MS PERSON PRODUCTIVITY RATIOS

3
AVERAGE PRODUCTION

Acquisition Bankers 26
2.5

2 LG (WPB)

Islamic Bankers 22 LG (AB)
1.5
LG (IB)
1 LG (ELB)
WPB Consultants 42 0.5

0
GRCB Lead Generator
JAN FEB MAR
ELB Lead Generators 44 Conference, London, 18 & 53
19 May 2008 MONTHS

TECHNOLOGY & ENABLEMENT

Optimal technological enablement solution per segment

Technology Solution Targeted Areas Status Medium Term View

Digital • Entry Level Banking • LAUNCHED • Implement nationally
Pens • ESPs
• WPB Kiosks

Laptop • Core Middle Market • LAUNCHED • Implement nationally
Kits • Retail Affluent
• Islamic Banking
• Mobile Sales Units
• Bank on Wheels
Card and • All NBS sales • LAUNCHED • Full implementation
Pin environments
Mailer

Other • Entry Level Banking • IT LITE SOLN • Introduce alternative devices
Devices LAUNCHED

Fulfilment • All NBS sales • INTEGRATION • Implement ED
Portal environments

ENABLEMENT PLATFORM
Technological Integration ensure a seamless end to end Sales fulfilment process

Note: Integrated Service – accessed by AGO, NBS Support hubs, other SBU’s and
ES & WPB Sales Consultants

KEY LEARNINGS

Solid progress despite challenges experienced

Positive Experiences Learning Curves

– Volume production – Poor performance in Value targets
– Variable compensation – Developing an accurate MI system to
– Segmented sales force track commissions and daily production
– “First Job Application” employees and – Attaining volume in certain targeted
productivity product lines
– Delivery channel positioning, e.g., – Bedding down technology enablement
External Sales Points – Investment Consultants with limited
– Bank on Wheels highly successful in transactional products to sell in targeted
Student Market and event based market
interventions – Lag in addressing poor performance due
– Positive productivity and performance to bedding down of overall DSA model
trends approach
– Contribution towards “New to Bank” core
customer growth

LG BUSINESS SIMULATION PROGRAMME
Description:
LG manage the performance of a Sales team through 3 cycles by following a 6 step process:
• Step 1: Teams receive goals per product and campaign
• Step 2: Teams come up with actions and ideas on how to create opportunity i.e. prospecting, networking as well as looking
at events in certain areas which might offer opportunities
• Step 3: Teams react to events and make service choices which will influence the amount of potential sales going into their
sales funnel
• Step 4: Teams analyse customer profiles and put together a Value Proposition which is presented and rated. The ‘client
sales interaction’ determines the number of products in the sales funnel (cross-selling opportunities)
• Step 5: All team members fill out documentation and indicate compliance requirements per product for those products they
managed to sell in step 4. Faulty applications leads to lost sales
• Step 6: Teams receive final actual revenue and compare it to targets. Action plans are put in place for the next round

Reflect
Workshop

Plan for
Do Feedback/coaching action
Pre-work Action
(Product Planning
Knowledge &
Tool) Simulation
Apply Application Execution

3 Simulated Analyze/present
cycles 57

SALES PERFORMANCE MEASUREMENT PROCESS

Sales support Clerk
receives application,
Sales consultant Sales consultant submits conducts quality check
complete application application to respective and then proceeds to
with customer Sales Support Hub for captures application on
processing. FBSS. Sales support clerk
then captures details and
status of application on

Manuel Submission
DSAS.

• Digital Pens
Technology:

• Lap top Kit
•Productivity by sales
consultant The following status of the
•Productivity by Sales DSAS system generates application can be captured
Support productivity reports based on DSAS.
•Productivity by Region on what has been captured • Approved
•National Productivity. at the Sales Support Hubs. • Pending
• Number of Sales per Sub- • Declined
Product

58

SALES COMMISSION PROCESS
Detail report of all applications
Sales consultant to complete Regional manager to send
processed and approved is
application with customer and validated report to national
extracted from the DSAS system
send application through to sale sales manager by the 3rd
by the regional manager for the
support hub for processing on working day of month.
respective region and validated
FBSS and capturing on DSAS.
for accuracy by the second
working day of the month.

Business Analyst from Business analytics department to
use spreadsheet received from National sales manager to
National sales manager to collate all
verify against the Absa data warehouse for activated
validated regional reports into one
status of transactional, unsecured lending, insurance,
spreadsheet, verify for correctness and
savings and investment products. Only valued added
submit to Business Analytics department
products will not be verified for activated status. by the 4th working day of the month.

Once the business analyst has
Commission will then be calculated for completed the commission calculation,
all verified activated sales (in the case business analyst to send commission
of value added products – only claims to General Manager (External
applications captured as approved on Sales and Operations) for validation
DSAS - will commissions be calculated and sign-off by the 7thth working of the
for). month.

General Manager (External Sales and Operations) to sign-off
commission claim and send through to Quest for payment of
commissions to direct sales agents by the 8th
working day of the month.

59

1. Background

MOBILE E-COMMERCE

1. Background

OVERVIEW M-COMMERCE
• Internet banking has received the most coverage over the last decade

• Movement towards greater mobility as mobile phones become more sophisticated

• These phones can know handles more advanced applications & services

• Banking via mobile phones appeals to consumers on multiple fronts

• Mobile phones also serve as an efficient vehicle for making contactless payments, P2P transfers, providing greater
security protocols and storing in-depth preference information

• Various software platforms for mobile phones and other devices will allow the consumers to use the web

• Over the next decade the movement towards Mobile Banking will rapidly increase

• Other technology developments will affect retail banking and these include:
• Growing broadband at lower costs
• Webcams via Web 2.0 will reach consumers at home
• VoIP
• Instant message systems
• Social Network (face-book, twitter, etc)
• Thin client capabilities makes remote access easier

• Level of security protocols and applications is constantly improving

• Technology is allowing banks to be more cost effective and efficient

1. Background

MOBILE TRENDS 2011
• Year of the smart phone even for the ‘dumb’ user

• Apps vs. mobile content internet will continue

• Mobile marketing spend will grow significantly (USA to exceed the 1 billion
mark)

• Mobile will increasingly prompt customers to interact with their physical
environment

• Companies will invest first in convenient services for customers, acquisition
will come second

• Casual gaming will continue to lead the mobile change for content

• Term mobile will mean a lot more than mobile phones (I-Pad)

1. Background

BEST PRACTICE FOR SUCCESSFUL M-BANKING STRATEGY
• Implement SMS based M-Banking capabilities that focus on the
most relevant and actionable alerts for customer today

• Plan for the future

• Anticipate the increased need to intelligently reach out to
customers across multiple communication channels (SMS,
email, voice, and instant messaging)

• Select a service provider that enables and implements a cost-
effective delivery of SMS capability & function

1. Background

MOBILE GROWTH DRIVERS

1. Background

SOCIAL NETWORKS

1. Background

MAIN FEATURES OF MOBILE COMMERCE

• Ubiquity – anywhere

• Immediacy – anytime

• Localisation – GPS specific to a location

• Instant Connectivity – General Pocket Radio Service (GPRS), means mobile
service are online and always on

• Pro-Active Functionality – tailor making to suit the needs of a user, IOW, a
user can choose what he wants to view or receive on his mobile

• Simple Authentification Procedure – electronic chip found in mobile devices
call Subscriber Identity Module (SIM) using a PIN

1. Background

SERVICES IN MOBILE BANKING

Account Operations Account Administrations
Money Transfers Changing accounts
Bill payments Blocking lost cards
Money Transfers Cheque book requests
Subscribing insurance policies Administration

Account Information Product Information
Balance enquiries Product Information
Statement requests Product Pricing
Threshold alerts Interest rates
Branch/ATM locations FOREX rates
Helpline
Credit card info

1. Background

MOBILE BANKING AND CORE TARGET GROUPS
a) The Youngsters:
• The segment of the 14-18 years old
• Technology savvy and willing to experiment with innovative products/services
• On the move, demand ubiquitous, anytime service
• Represent future prospects
• Hence marketing must be used to cultivate this group

a) The Young Adults
• Technology & innovation friendly
• Financially not very strong
• They also will need to be cultivated through marketing
• Students to beginning of a career

a) The Business People
• Age group 26-50 years
• Important segment to mobile banking
• Well educated & economically well-off
• On the move, hence carry mobile devices
• They demand financial services and products

1. Background

MEASURING EFFECIENCIES OF MOBILE BANKING

1. Background

TRENDS IN USERS (2007, EUROPEON UNION BANKS)

1. Background

SMS BANKING
• Using mobile phone via TEXT to conduct banking functions:
• Balances
• Mini-statements
• Transfers (M-Pesa)

• Different to telephone banking

• Helps users keep track of banking activities anytime, anywhere, any place

• Some do not charge for SMS banking (South Africa – cross-sell/retention)

• Most to all phones are capable in using SMS banking

• SMS alerts, keeping you informed on daily transactions

• Costly, complex when looking at future growth, developments

• A comprehensive mobile messaging solution must be able to abstract, send, and receive messages from multiple channels,
including mobile devices, landlines, & IVR systems

• The capability implies the need for a MULTI-MODAL messaging architecture

• Multimodal architectures help banks cost effectively deploy SMS messaging services without upgrading existing IT
infrastructure or adding support personal

• This allows users/customer to perform simple transactions (balances, statements, transfers…etc)

• Current focus is on SMS functionality, over WAP & app type solutions

1. Background

CONSUMER PREFERENCES FOR SMS BANKING (2007, US)

1. Background

MULTIMODAL MESSAGING ARCHITECTURE
• Enables a single messaging strategy
• The platform uses application programming interface to abstract, track, transmit and receive messages from
multiple channels
• Customer profiles determines where/which messages go
• Routes messages via multiple networks
• Switches between communication channels until customer receives the message

WHAT DO CUSTOMERS WANT??????

Customer
 Most customers prefer to purchase in the branch Centric View

 There are groups that are moving away from branches, and towards alternative
channels, mobile sales force, cell-phone banking, internet

 Excellent service
Convenience
 Convenience and accessibility &
Understanding the
needs

 Feedback

 Customers want products that are understandable and easy to transact with

OBJECTIVES

 Launch a differentiated retail branch

 A multi-channel approach to support the accessibility and convenience for
customers

 To ensure that channels are profitable and sustainable

 To ensure that our channels offer superior customer service

 Keep our approach simple

 Doing things right the first time

SWOT ANALYSIS
Strengths Weaknesses

 New Bank that has the flexibility to innovate and re-invent IT and Ops infrastructure
the market place
Speed to execution
 NO legacy issues
Recruitment of appropriate skills
 New, innovative and strong retail management team
Not an established brand
 Cross border roll-out, implementation and execution

 Achieve critical mass, representation

Opportunity Threats

Creating a well differentiated bank in a concentrated bank Global Economy

Creating a NEW and leading brand NOT well diversified

Product innovation and leadership Budget constraints

Critical Mass Operational support at HQ

Offer convenience, accessibility Lack of buy-in, change management

Diversification on the income streams

77

KEY DIFFERENTIATORS
Branch design
24 hours zone concept incorporating enquiries, statement printing, ATM banking, internet banking
Zone concept (transaction managed in zones, teller combined with enquiries) QMS
Queue management system (QMS) CR2
Meeter greeter
Innovation in the area of enquiries

Customer relationship management
Every customer has a relationship manager (the size of the portfolio depends on the customer segment)
CRM
One person responsible for customer cross sell and up sell activities MIS
Portfolio targets connected to performance management system
Introduction of standardized CRM programs for a) new customers,
b) customer life cycle tree and c) product activation, usage and balance build.

Service quality management
SLA´s for branches and call center introduced and measured from the beginning
WFM

Documentation & Data workflow management
Usage of electronic documentation and data workflow system for all customer products application, contracts, filing
Distribution
system (no paper, minimize operation risk) Product

Partnerships
Increasing BancABC market share, profitability and critical mass

78

HUB N SPOKE MODEL KIOSK

Bank on
BancABC
Wheels
@WORK
INTERNET

Flag branches provide the brand equity
Various Channels offer convenience and accessibility
Call
This helps achieve critical mass
Branch Messaging 3rd
POS Educating clients on various channels
Centre PARTY
Increasing usage and transaction

CELLPHONE
BANKING
DSA
SUITES

ATM

79

COMPETITORS BANKS –DIAMOND BANK

80


81


82


83

INTERNATIONAL BANKS

84

INTERNATIONAL BANKS

85

INTERNATIONAL BANKS

86

INTERNATIONAL BANKS

87

INTERNATIONAL BANKS

88

INTERNATIONAL BANKS

89

INNOVATIVE BRANCH DESIGN

90

CUSTOMER JOURNEY THROUGH A BRANCH

1. 24 hour zone
2. Meeter Greeter
3. Merchandising zone
4. Cash zone
5. Consultation
6. Customer zone
7. Back office & Cash management (Safes)
8. Staff area

91

BRANCH CATEGORISATION & TYPES
 Branch Categorisation:
 Category 1 (Universal, 500 -800 sq/m)
 Category 2 (Retail Branch, 300-499 sq/m)
 Category 3 (Retail Outlet, 150-299 sq/m)
 Niche Branches, below 149 sq/m, Mortgage centre, SME, Private Suite,
Islamic Banking Suite,etc
 Outlet Types:
 Mortgage centre
 SME centre
 Universal Branch
 Retail Branch
 Retail Outlet
 Niche Branches
 Kiosk (large, medium, small)
 Bank on Wheels
 Bank in a Box

92

DETAILS OF THE OUTLETS
LINK.....

93

BRANCH SERVICES
Type of branch Cash in Cash out Account opening Cheque Stateme Enquiries Forex BC DC
in the system collection nts

Kiosk On-line


Mini branch
     

Retail outlet
     

Retail branch
       

Universal branch
        

SME Center
    

Mortgage Center
   94

PORTFOLIO MANAGEMENT
 Each customer assigned RM
 RM linked to segment portfolio:
 Top Mass/Mass Combined
 Retail Affluent
 SME
 Size of the individual portfolio depends on the Sub segment the customer
belongs to.
 The number of the relationship officers per branch will be reviewed and
planned on yearly basis and will be based on
 target market potential/number of NEW customers (acquisition),
 branch targets
 portfolio size
 Obtain competitive information on what the top 3 competitors are doing on
the portfolio size and allocations

95

PORTFOLIO MANAGEMENT
Sub segment Portfolio size per 1 Catchments area /target potential Reporting line Other comments
RM

Mass 800 – 1.000 Based on Sales Activity Plan Branch manger (disciplinary and Segment Mass & Top Mass will be covered by
Growth per year functionally) Senior RM Mass until the critical mass is
reached

Top Mass 400 – 600 Based on Sales Activity Plan Branch manger (disciplinary and
Growth per year functionally)

Affluent 250 – 400 Based on Sales Activity Plan Branch manger (disciplinary and For launch we will have standalone RM for
Growth per year functionally) affluent

SME 400 – 600 Based on Sales Activity Plan Branch manger (disciplinary and If the target segment is not sufficiently big
Growth per year functionally) the branch manager will substitute the role
until the portfolio reaches 80 customers.

Professionals (if 250 – 400 Based on Sales Activity Plan Branch manger (disciplinary and If target segment is not sufficiently big the
stand Growth per year functionally) SME RM will substitute the role until the
alone portfolio reaches 100 customers.
position)

Corporate (in a TBC TBC TBC
universal
branch)

Corporate TBC TBC TBC
(serviced
from
country 96
HQ)

BRANCH STRUCTURES

Universal Branch (15-35)
Following org chart shows all possible position covered in a Universal branch. In year 2009
following position will be merged:
Segment Professionals will be covered by RM SME
Segment Mass & Top Mass will be covered by Senior RM Mass until the critical mass is
reached

97

…BRANCH STRUCTURES

Retail Branch (15-25)
Following org chart shows all possible position covered in a retail branch. In year 2009
following position will be merged:
Segment Professionals will be covered by RM SME
Segment Mass & Top Mass will be covered by Senior RM Mass until the critical mass is
reached
Bulk cash will be installed only if required for servicing Corporate customer.

98

SESSION 4: Alternative Banking Strategy

ALTERNATIVE DISTRIBUTION

“Segmented AD Channel focus providing multiple options of delivery”

100

Type Design Number Functionality Fulfilment Segment Location
of Staff
Kiosk •Rectangular or 2 options as supplied 2-4 DSA’s •Account opening On-line Personal Bank Large corporate offices or
Large by vendor •Basic Enquiries Desk top segments Government departments
•Merchandising •ATM PDA Or where there is high traffic volume.
•Point of Sale •Mini statement Scanner
•LCD screen •Leads Management Printer
•2 X workstations(hardware, printer, •Cheque collection Bio-metric
scanner, fax, camera) reader
•2 staff chairs Pin reader
•4 customer bar stools/tables Camera
•ATM-small
•POS device
Kiosk •Rectangular, Square, Oval, or 2 2 DSA’s •Account opening On-line Can be Shopping centres
Small options as supplied by vendor •Basic Enquiries Desk top segmented Retail outlets, via cooperatives
•Merchandising •ATM PDA based on Corporate offices
•Point of Sale •Mini statement Scanner identified Where there is high volume traffic in
•1 X workstations(hardware, printer, •Leads Management Printer cooperative, defined segments
scanner, fax, camera) •Cheque collection Bio-metric alliance, etc
•1 staff chairs reader
•2 customer chairs/tables Pin reader
•ATM-small Camera
•POS device
Bank •Vehicle that caters for security, 3DSA’s, 1 •Account opening On-line ALL segments All dedicated sites which caters for
on transport and flexibility Driver •Basic Enquiries Desk-tops based on security and customer experience
Wheels •Merchandising •Cash deposit Scanner deployment
•Point of Sale •Withdrawals Printer strategy
•2 X workstations(hardware, printer, •Mini statement Bio-metric
scanner, fax, camera) •Leads Management reader
•3 staff chairs •Consumer Education Pin reader
•4 customer chairs/tables Camera
•ATM-small, ramp
•POS device
•LCD, DVD combo
•Bullet proof glass
•Gazebo
•Generator 101
•Satellite link
•PA, sound system

Mobile •1X Vehicle 8-10 •Account opening Off-line Events ONLY
Sales •1X Gazebo DSA’s, 1 •Basic Enquiries Lap-tops
Units •Merchandising driver •Mini statement PDA
•Promotional material •Leads Management Copier
•Laptop, Copier, scanner, camera •Consumer Education Scanner
•1X Gazebo •Acquisition strategy Camera
•2 tables
•2 staff chairs
•4 customer bar stools
•Consumer Education
•LCD, DVD
•PA, sound system
External •1X Gazebo 2 DSA’s •Account opening Off-line Events ONLY
Sales •Merchandising •Basic Enquiries Laptops
Points •Promotional material •Mini statement PDA
•Copier, scanner •Leads Management Copier
•2 tables •Consumer Education Scanner
•2 staff chairs •Acquisition strategy Camera
•4 customer bar stools
•PA, sound system
Bank in •40ft or 20 ft Container 1X •Account opening On-line Personal Bank Before branch opens in a designated
a BOX •1X large ATM Supervisor •Basic Enquiries Desk top segments area/region.
•Server Room 2 X Tellers •ATM PDA Or Rural areas
•Satellite (GPRS) link 2 X •Mini statement Scanner Specific segment, Where sourcing locations becomes
•Rectangular or options as supplied by relationshi •Leads Management Printer e.g. challenging
vendor p •Cheque collection Bio-metric SME, Mortgage,
•Merchandising Managers reader etc
•Point of Sale 2 X DSA’s Pin reader
•LCD screen Camera
•2 X Sales workstations(hardware, printer,
scanner, fax, camera)
•2 X Teller workstations(hardware, printer,
scanner, fax, camera)
•1X safe
•2 staff chairs (sales)
•2 staff chairs (tellers)
•2 X customer bar stools (teller)
•1X Generator
•Air-con unit
•Municipal requirements, and contractor
to lay concrete foundation 102
Other As recommended by vendor

MOBILE SALES/MARKETING FORCE
“Segmented Sales Force to support Retail Branches”

Call Centre The purpose of BancABC@Work
Direct Sales banking is to provide
convenient unique value
propositions for the employees
in the workplace

DSA: Work Place Banking / AD
The purpose of Direct Sales is to acquire

Outbound Sales Teams
DSA: Top Mass / Mass

Inbound Sales Teams
business outside of the traditional branch
DSA: Retail Affluent

Leads Management
network and provide customers with additional
and often non traditional channels to do
DSA: SME business with ABC

The purpose of the CC is to optimise use of
telephony to acquire new, cross sell existing
customers and to support external sales staff

Development of compelling and competitive value propositions for workplace and direct sales
Providing qualified leads to the DSA teams

Direct Sales Leads Management
BancABC@work– “Bank conveniently “Managing daily
“Bank conveniently at home/community” activity”
at work”

107

MOBILE SALES FORCE KPA’S

 Key focus areas
 Worksites – BancABC propositions for the employer and employee
 Group Schemes – Homogenous groups with common interests
 Urban communities - mobile sales and service
 Support for new branches – before and after outlet opening
 Staffing of non traditional outlets – kiosks/containers/forecourts
 Direct sales opportunities –
Investments/transactional/insurance/personal loans/Credit
Cards/Debit Cards
 Support for Events
 Optimise the use of Contact Centres for sales
 Optimise leads and referrals for all segments, products

108

MSF TARGET MARKETS

 Target Market:
 Leads: Cross and up-sell
 Existing individual corporate customers across segments
 Smaller employees that do not warrant on-site workplace banking
solutions
 Direct Selling Activities: New Business
 Potential new individual customers across all segments
 Employees of corporate and small businesses
 Niche groups e.g. Youth, Students, Seniors, Medical Graduates,
Retail Affluent, etc.
 Support for new branch openings and events
 Community events
 Professional bodies

109

BANK@WORK
Provision of banking services to company employees at their place of work. The work place banking
channel must be a online banking operation catering for types of branch transactions and services. Cash
handling in terms of over the counter deposits and withdrawals is not available through the work place
banking channel (ONLY via ATM).

110

BANK@WORK....ADVANTAGES

Employers: Employees:
Financial Services Provider:
• Improving and extending • Employees can access financial
• Access to a larger potential regular
existing benefits/packages services products and services
• Little or no extra cost for earning customer base
on a beneficial basis
• Partner with key employers to provide
the employer • Convenience for employees
• Relief of the employer • Advice on more complex bulk services to lower cost and
administration improve customer experience
financial service offerings
• Employers participation • Can offer concessions and lower costs
• Usually provides access to a
offers employees a to customers on basis of lower
larger range of products
convenient way to bank • Packages can be customised delivery cost
• Assists with worker • Access to payroll deductions
• Financial literacy training on
• Cross-selling opportunities
productivity site enables employees to
• Could be used as a benefit • Grow with the customers
make informed choices
to lock-in the worker

111

BANK@WORK

Banking Solutions

Internet, Telephone, Cellphone and
Direct Sales Agents and Alternative
Direct Sales & Service Delivery

Transactional Solutions Lending & Credit Solutions

Contact Centre/Telephony
ATM Banking Solutions
Points of Presence

E-Channels
Savings & Investment
Risk Protection Solutions
Solutions

Value Added Services
Financial Education

112

SALES ACTIVITY PLANNING PROCESS

What is the market
Potential, per KPI”S
segment

END IN MIND
END IN MIND
Activities planned
to penetrate Leads Management Process
the target market
ATL, BTL

Planned campaigns
Completed 3-4 months advance

113

SALES MANAGEMENT PROCESS
Planning:

PLANNING • Collecting market and portfolio
information
• Analyzing information to
prioritize target markets and
customers
• Deciding on goals
• Identifying resources
• Identifying and scheduling
appropriate marketing actions
• Forecasting expected results
• Tools:
 SWOT Analysis
 Prioritization of
target markets
 Branch marketing
calendar
 Planning specific
marketing actions
 Sales Campaign
Plan

114

Activities:

• Setting appropriate individual ACTIVITIES
goals in terms of activities and
goals
• Coaching and developing people
• Preparing scorecards
• Evaluating specific marketing
actions
• Providing and using information
on Performance standards
• Tools
o Referrals
o Sales pipe-line
o Sales board
o Evaluating specific
marketing actions

115

Portfolio:

Using a range of measures to track
performance and these include
• Portfolio size and portfolio
growth
• Customer portfolio
• Quality indicators
• Profit and loss
• Other MIS
• Analyzing these measures to
develop effective action plans for
the future

PORTFOLIO

116

Sales

• Setting appropriate individual
goals in terms of activities and
goals
• Coaching and developing people
• Preparing scorecards
• Evaluating specific marketing
actions
• Providing and using information
on Performance standards
• Tools
o Referrals
o Sales pipe-line
o Scorecard planners
o Sales board
o Evaluating specific
SALES
marketing actions

117

SALES MAP

PLANNING ACTIVITIES

ACTION
X
FREQUENCY
=
RESULTS

PORTFOLIO SALES

118

ENTIRE SALES MANAGEMENT PROCESS

PLANNING ATTRACTING CLOSURE

Where do we get the business, What campaigns to attract the
target market, propensity target market Needs analysis to closure
for business ATL
BTL

119

E-CHANNELS – WHERE DO THEY FIT
Customer Data & Insights
Customer

Customer Segments
Blue Silver Gold Private SME Corporate

Customer value propositions

Internet
Branch ASD ATM Website Banking Cellphone POS CCC
Distribution
Channels

Sales and Channel Management

Customer Service

Messaging

Personal SME Corporate
Product

• deposits, savings • deposits, savings • deposits, savings
• Transactional • Transactional • Cash management
• Consumer finance • Consumer finance • Transactional
• Cards • Cards • Forex
• etc • etc • etc
121

INTEGRATED CHANNEL MANAGEMENT DELIVERED BY CR 2

122

GUIDING PRINCIPLES (SET 1/3)

1. Activation of e-channel access is part of the initial customer on-boarding process
2. ATM placement will form an integral part in the approach to physical distribution
planning (hub & spoke model)
• Routine transactions will be migrated from the branch to maintain high branch
productivity levels
1. Our own customers can transact on our own ATMs (Us-on-Us transactions) and on
competitor ATMs (Us-on-Them transactions)
2. Our objective is to provide sufficient capacity and distribution to meet the requirements
of our own customers (match our ATM capacity to our own customer transactions (Us-
on-Us+Us-on-Them)) at an acceptable cost-to-income ratio (target 50%?)
3. To cover the transaction distribution continuum, thus increasing coverage and
convenience for customers, we will provide cost effective solutions to cover the range

123


6. Other banks’ customers’ transactions on our ATMs are viewed as a bonus because
we have no control over them
7. Each branch, kiosk and bank on wheels will have at least one ATM model
8. Our target average transactions per device per month are as follows:
• Cash-back at POS device : 800 -1 500
• Cash dispensing ATM – low volume: 1 500 – 3 500
• Cash dispensing ATM – medium volume : 3 500 - 5 500
• Full-function ATM : 5 500 and above
This will maintain our cost-to-income ratio at 50%?
We want our customers to do banking on our own ATMs
9. If the average number of transactions per device per month exceeds the target
because of growth in our own customer transactions (Us-on-Us+Us-on-Them)
transactions, we will increase capacity to match the growth

124


10. ATM functionality is divided into 2 categories;
• Short transactions (cash and others) will be restricted to cash dispensing ATM. This is
our cash-and-dash proposition
• Long transactions and other non-cash transactions will be available on the statement
printer machines
10. The priority in ATM placement is as follows:
• Servicing our customers
• Supporting customer acquisition
10. Outsourcing the ownership of ATMs is not recommended because It is less profitable than the
Bank owning and running its own ATM service
11. Customers will have a holistic view of their relationship (products and services) with BancABC
12. All leads, new product sales and transaction revenues earned will be credited to the domicile
branch

125

OBJECTIVES - A BALANCED SCORECARD APPROACH
Increase Non-
Interest Income 1. Deliver cost effective growth in ATM transactions aligned to customer
Financial

FN1
growth – target cost-to-income ratio of 50%?
Control Operating 2. Complement the branch by lowering cost of operations (reduce cost-to-
Costs income ratio)
FN4

1. Customer aligned ATM distribution/coverage
Customer

Excellent Customer
Service Location of ATMs
CT1
Accessibility/visibility of sites
2. Deliver customer-friendly ATM interface and functionality resulting in less
Innovative Tailor
Made Solutuons than 1% system failed transactions
CT2 3. Deliver innovative, value-added services on ATM
4. Deliver 98% ATM service availability
Develop Products that
1. Deliver customer-friendly ATM interface and functionality resulting in less
Internal Process

meet Customers needs
IP2(b)
than 1% system failed transactions
Intimate Knowledge 2. Deliver one-view of customer, one-view of back (holistic relationship of
our Customers customer with XYC)
IP1(c)
3. Conduct customer feedback sessions every month and act on the feedback
Continuous Customer 4. Deliver 98% ATM service availability
Feedback
IP1(b)

Increase IT Uptime
IP3(d)

126

ATM DISTRIBUTION PLANNING PRINCIPLES
 All branches will have at least one cash dispensing ATM, statement printer and an
Internet terminal
 All kiosks will have a cash dispensing ATM
 Remote/Off-site ATM placement is guided by:
 Bank card penetration
 Customer transaction behaviour aligned to:
 Retail activity: shopping malls, regional shopping centres, suburban centres, goods markets
etc
 Transport nodes like airports, train stations, taxi ranks
 Convenience locations – service stations, casinos, selected convenience stores
 Schools and hospitals
 Competitor activity (transactions “lost” to competitor acquirers)
 Queue lengths at existing ATM sites
 Bank@work requirements (Corporate banking propositions)

127

ATM BUDGET PLANNING PROCESS
 The customer growth estimates is the sole motivation for growing ATM numbers

 Other factors to consider in the budgeting process are:
 Performance of the ATMs already in the network
 Amount of money paid away as interchange fees (BancABC customers transacting on
other-bank ATMs)
 Branch and kiosk rollout plans

 Bulk ATM orders are preferred for economies of scale purposes and minimising
lead-time to delivery from vendor(s)

128

OFF-SITE ATM DEPLOYMENT PROCESS
Commis
Valida Secur Prepa Install
Site identification sion
te e re ATM
ATM

-Field analysis -Site plans
-Retail activity -Construction
-Branch network -Communication
-Foot flow -System entries
-Competitor activity -Service providers
-Security (building, cash servicing etc)
-Accessibility
-Visibility
-Power and communications
-Rentals

129

ATM OPS REQUIREMENTS
 Key operational requirements
 Key requirements are:
 ATM Installation and commissioning (signage
 ATM service availability (system working) / ATM service monitoring
 Cash loading (no cash-out situations)
 Hardware / software updates/error rectification
 Patch updates and ATM campaign downloads
 House-keeping
 Payment clearing and settlement
 Payment query resolution (payment tracing etc)
 Cash balancing on a regular basis

130

ATM MONTHLY TRANSACTION DISTRIBUTION CONTINIUM

1 400

1 200

1 000
No of potential sites
No of potential sites

800

600

400

200

0
500 800 1000 2 000 3 000 4 000 5 000 6 000 7 000 8 000 9 000 10 11 12 > 13
No of potential transactions / site / month000 131
000 000 000

MARKET STATS – VISA TRANSACTIONS

132

MARKET STATS – NO OF VISA ATMS

238
ZIMBABWE
217

172
ZAMBIA
111

180
TANZANIA
99

415
MOZAMBIQUE
382

284
BOTSWANA
245

0 50 100 150 200 250 300 350 400 450

YE 2007 Q2 YE 2008 Q2
133

MARKET STATS- NO OF VISA ATMs

1.80%
1.80% $250,000
$250,000
1.60%
1.60%
1.40%
1.40% $200,000
$200,000
1.20%
1.20%
$150,000
$150,000
1.00%
1.00%
0.80%
0.80%
$100,000
$100,000
0.60%
0.60%
0.40%
0.40% $50,000
$50,000
0.20%
0.20%
0.00%
0.00% $0
$0
BOTSWANA MOZAMBIQUE
BOTSWANA MOZAMBIQUE TANZANIA
TANZANIA ZAMBIA
ZAMBIA ZIMBABWE
ZIMBABWE

Interchange revenue
Interchange revenue Share of BancABC ATMs -end 2009
Share of BancABC ATMs -end 2009

134

POINT OF SALE REQUIREMENTS

 Merchant and end-customer service convenience
 Long-term merchant relationships
 Secure IT systems
 Financial needs analysis/guide to financial solution
 Quick turn-around times (product application, queries
etc)
 Payment tracing
 Payment clearing and settlement (interbank payments)

135

WEBSITE OBJECTIVES

Informational objectives
• Cost-efficiently supports the overall E-Channels strategy
• 24-hour, convenient provision of relevant information to all
BancABC stakeholder groups
• Provides a platform for sales and customer lead generation

136

INTERNET BANKING
 Transactional, cross-sell
 Aligns to the E-Channels mandate through the provision of remotely
accessible (through the internet), secure, 24-hour, convenient, cost-
efficient non cash-based daily banking services to the Bank customers,
optimising channel usage and facilitating the sale of new accounts as well
as lead generation
 Secure IT systems
 Financial needs analysis/guide to financial solution
 Quick turn-around times (product application, queries etc)
 Peace of mind
 Payment tracing
 Payment clearing and settlement (interbank payments)

137

CELLPHONE BANKING

Informational, transactional, leads generation
 Aligns to the E-Channel mandate through the provision of remotely
accessible (through any cellphone handset device),
 Secure, 24-hour, convenient, cost-efficient non cash-based daily banking
services to the bank customers
 Optimising channel usage and facilitating the sale of new accounts as well
as lead generation

138

END OF DAY 1

HAVE BANKS COMPLICATED WHAT
CUSTOMER SIMPLY WANT

139

 Day 2
 Session 1: Segmentation

 Session 2: CRM & Process Management

 Session 3: Performance Matrix

 Session 4: Fraud & Security Methods

 Session 5: Branding, Social Media

140

OVERVIEW CHICKEN or THE EGG…
 Chicken or the Egg scenario, which comes first Strategy or Segmentation?

 Customer segmentation is the practice of dividing a customer base into groups of individuals
that are similar in specific ways relevant to marketing, such as age, gender, interests, spending
habits, and so on. Using segmentation allows banks to target groups effectively, and allocate
marketing resources to best effect

 Traditional segmentation focuses on identifying customer groups based on demographics and
attributes such as attitude and psychological profiles

 Value-based segmentation, on the other hand, looks at groups of customers in terms of the
revenue they generate and the costs of establishing and maintaining relationships with them

 Customer segmentation procedures include:
 deciding what data will be collected and how it will be gathered;
 collecting data and integrating data from various sources;
 developing methods of data analysis for segmentation;
 establishing effective communication among relevant business units (such as marketing and customer service) about
the segmentation; and
 implementing applications to effectively deal with the data and respond to the information it provides

142

SEGMENTATION GROUPS

Preferred
Downgrading Growth
Pattern
(Upgrading)

143

SEGMENTATION GROUPS - CORPORATE

Preferred
Downgrading Growth
Pattern
(Upgrading)

144

SEGMENTATION METHODS

 Geographic variables

 Demographic variables

 Psychographic variables

 Behavioral variables

145

SEGMENTATION CRITERIA - INDIVIDUALS
Geographic Will Demographic Will Psychographic Will Behavioral Will a
Variables ABC Variables ABC Variables ABC Variables bank
use use use use
them? them? them? them?
Region Yes Age/DOB Yes Personality ?? Product use Yes

Country Yes Gender Yes Lifestyle ?? Benefit sought Yes

Density/Suburb Yes Income Yes Value ?? Loyalty Yes

City/Town Yes Education Yes Social class ?? Credit use Yes

Postal code Yes Family size Yes Interests Yes

Occupation/Professi Yes Account bal. Yes
on

Nationality Yes Memberships Yes

Religion Yes Risk profile Yes

Language Yes

Marital Status Yes

Race Yes

Residential status Yes

146

SEGMENTATION CRITERIA - CORPORATES
Criteria Will ABC use the criteria?
Number of employees Yes

Industry Yes

Location Yes

Loan size (Use of credit facilities) Yes

Balance sheet size Yes

Company type (CC,Pvt) Yes

Profitability ??

Turn over ??

147

SEGMENTATION CODES/IDENTIFIERS
Segment Primary segment Code Sub segment codes

HNI/Affluent 100 101+

Rising Affluent 200 201+

Middle Class 300 301+

Large Corporates 400 401+

Small to Medium Enterprises 500 501+

Small Enterprises/Self 600 601+
Employed Professionals

148

CUSTOMER SEGMENTATION PROCESS
STEP 4 STEP 5 STEP 6
STEP 1 STEP 2 STEP 3

Assess which group Assess per group Create
Assess the value of Stratify or group
Define the full of customers to of customers the segments of
potential of the each customer customers based
target based on unique attitude customers
on their potential
market potential size, or behavioral with the
mix of usage potential revenue variables of same needs
(Life Time Value) and customers values and
share of voice
wants

How many Assess the relative •From where are the •Define the •Ego driven, $ Select the
customers are importance of new customers characteristics of driven, convenience segmentation which
there in the each customer in coming? (I.e. what each segment (e.g. driven, service most effectively
defined market terms of either the is the referral average driven, scientific groups customers
What (validate source) number of pattern / who refers? size/potential, key driven, etc... with the same needs
questions customers or Based on what? purchasing factors, Your segmentation
do I need usage •Identify in each ways should offer each :
to answer •through sales stratus the new Life to influence •Measurability - the
and what visits / Market Data Time Value of the decision making) size & purchasing
do I need •What is the market customer •what is the size of power of the
to do? we serve & who are •Which competitors each segment? segments must be
all the customers are targeting these •Is it homogenous? measurable
who may benefit same customers? •How do •Accessibility - it
from our product? salespeople must be possible to
Are we missing any interact with reach & serve the
customers (I.e. customers in the segment
those traditionally market and what
•Substantiality - the
served by our are the key market
segments must be
competitors)? drivers?
large & profitable

149

CUSTOMER SEGMENTATION PROCESS
STEP 7 STEP 8 STEP 9 STEP 10 STEP 11

Validate the selected Target the most Which product / Decide on product Develop for each
segmentation attractive segments brand is being used positioning for customer in targeted
approach based on potential by each customer in each of the segments a plan with
size and potential target segments targeted segments an objective , tactics
revenue (validate sources) and action plans.

Consider •How easy will it be to · Check whether needs
supporting convert customer in are being addressed
evidence for your each segment
segmentation segment to our • How to overcome
products? the hurdles for using
What Does the market
•How responsive is our products ?
questions really work the
do I need way you have the segment to
marketing actions? • Assess cost for each
to answer segmented?
action plan and decide
and what •Are the most •What would be the
whether it is feasible,
do I need successful cost of serving the
to target the segment
to do? competitors taking segment?
a different •How are the •Review regularly
segmentation competitors targeting whether the needs
approach? these customers? and wants are
•What market data •Evaluate satisfied profitably
do you need to attractiveness of each
confirm current segment •Review regularly the
segmentation? size of the segments,
the needs and wants
of each customer.
150

MANDATORY FIELDS - INDIVs

Personal details
 Title
 Surname
 Middle names
 First name
 Gender
 Date of birth
 Residential status
 Home address
 Home telephone number
 Period at this address
 Postal address
 Country of residence
 Nationality
 Business Telephone
 Cellphone number

151

MANDATORY FIELDS - INDIVs

Personal details cont,

 E mail address
 ID number
 Passport number
 Expiry date
 Driver’s licence number
 Marital status
 Number of dependents
 Spouse’s name
 Spouse’s employer and address
 Preferred method of communication

152

MANDATORY FIELDS - INDIV

Employment details
 Current employer and address
 Type of employment
 Occupation/Profession
 Occupation Title
 Length at current employer
 Monthly income
 Method of payment
 Banking details

153

MANDATORY FIELDS

Previous employment details
 Name of previous employer
 Address of previous employer
 Occupation title

Next of kin
 Address of next of kin
 Relationship
 Declaration
 Signature and date

154

OPTIONAL FIELDS - INDIVs

 Level of education
 Family size
 Religion
 Home language
 Race
 Social memberships
 Interests/hobbies
 How did you come to know of ABC?
 Consent for ABC and associate companies to market other products

155

MANDATORY FIELDS - CORPORATE

 Company Name
 Company address
 Postal address
 Telephone numbers
 Nature of business
 Contact person
 Contact details (e mail,telephone,cell phone)
 Designation of contact person
 Company registration number
 VAT registration number
 Directors

156

SEGMENTATION MONITORING TOLLS

 Assessment

 Observation

 Statistics

157

SEGMENTATION MATRIX
Business
line Retail Banking Corporate Banking

Personal Private Profes- SME Financial Government
Segment Companies Non Gov.Org
Banking banking sionals Banking institutions Org

Doctor
Local Banks Churches Provinces
Blue Main Dentist Micro Medium
Foreign Embassies Regions
(Mass) customer Pharmacist enterprises corporate
Banks Trusts Towns
Vets
Leasing Donor Org
Lawyer
Silver Family Small Large Insurance Pvt Schools Cities
Notary
(Top Mass) Cluster enterprises corporate Micro Pvt Hospitals
Other
Finance
Geologists Pension
Sub Medium Pvt
Gold Architects Multi Funds Gvt Hospitals
Segment size Universities
(Affluent) Engineers nationals Asset Mgrs Gvt Schools
enterprises MBA Schools
Accountants Building
Auditors Gvt
Societies Charitable Org
Bus.& Fin. Universities
Investment Civic Bodies
Consultants Other Gvt
Banks Other NGOs
Orgs
Other FIs.
Sports-
Persons
Journalists
158

CATEGORIES
Group Definition
Child 0-12 years
Youth 13-18 years
Student 19-28 years
Employees Any applicant who has an employment contract.
Housewives Non working spouse
Unemployed Unemployed (not self employed)
Self employed Any applicant who generates their own income for survival
XYZ employees Anyone employed by ABC
Associated Company employees Employees of ABC sister companies
Pensioners Former ABC employees who have retired
Gvt employees Any persons employed by Government (Civil servants)
Executives COOs, CEOs, CFOs, MDs, Executive Directors, GMs, FDs,
MBA/MBL/DBL Any MBA/MBL/DBL graduate
Professionals See list of professionals
Politicians Any persons holding a position of authority within a Political Party (Full time)
Pensioners Any person who has retired from formal employment and receives a pension.
Civil Leaders Civil Society Leaders, e.g. Mayors, Councillors, Judges, Magistrates,
Other
159

INDUSTRIES & SEGMENTS
Real state Developers Estate Agents Prop.Mgrs Construction Prop.Inv.Cos

NGOs Donors Churches Embassies Civic Groups

Education Universities Colleges Schools Kindergartens MBA Schools Libraries

Fin.Services Local Banks Foreign Banks Building Insurance Leasing Asset Managers
Societies

Traders Food Clothing Building Drugs Supermarkets Households
Materials

Agriculture Crop Farming Livestock Forestry Horticulture Grains and Fertilizer
farming And Logging Oils seeds companies

Mining Precious Quarry Mining Natural gas
stones

Media Publishing Media houses Advertising Broadcasters
Houses

Transport Car Fleet owners Car plants Storage Car hire Container
Dealerships And Transport Leasing

Tourism Hotels Lodges Airlines Travel agents Restaurants Safari Camps

160

SEGMENTATION CRITERIA – SME & CORP

No of
Loan size employees Turnover
Sector if
Segment Sub segment from up to from up to from up to applicable

Micro enterprises $0 $10 000 0 10 $0 $40 000

Small enterprises $10 001 $100 000 11 25 $40 001 $400 000
Medium size
SME enterprises $100 001 $250 000 26 100 $400 001 $1 000 000

Medium corporations $250 001 $500 000 101 250 $1 000 001 $2 000 000

Large corporations $500 001 $1 000 000 251 500 $2 000 001 $4 000 000

Corporate Multinationals $1 000 001 501 $4 000 001

161

SEGMENTATION CRITERIA – PERSONAL & PVT

Income Liabilities Assets
Group if
Segment Sub segment from up to from up to from up to applicable

Blue $0 $1 500 $0 $10 000 $0 $20 000

Personal
banking
Silver $1 501 $5 000 $10 001 $20 000 $20 001 $50 000

Gold $5 001 $20 000 $20 001 $100 000 $50 001 $200 000

Private Platinum $20 001 $40 000 $100 001 $500 000 $200 001 $1 000 000
banking

Super Rich $40 001 $500 001 $1 000 001

162

SESSION 2: Integrated Approach

OVERVIEW
An INTEGRATED APPROACH will demand:
 Long-term view
 Overcoming the SILO effect
 Establishing a WFM approach
 Using technology to ones advantage
 Refining processes
 Change management (LINK....)
 Refining product
 Team work
 A sense of urgency/culture of innovation
 An incubation phase for NEW PRODUCTs
 Modular approach (build on your success....CAPITEC BANK IN SA)
 Centralised DATA base and management

ARE THE CUSTOMERS HAPPY
164

INTEGRATED APPROACH SILO EFFECT
LARGE RETAIL BANK

PRODUCT PRODUCT PRODUCT PRODUCT
DIVISION 1 DIVISION 2 DIVISION 3 DIVISION 4

BRICK n MORTAR BRANCH

CALL CENTRE

E-CHANNELS & M-COMMERCE

VIEW OF VIEW OF VIEW OF VIEW OF
CLIENT CLIENT CLIENT CLIENT

NOT INTEGRATED
NOT INTEGRATED 165

INTEGRATED CRM APPROACH • Excellent service management with issue
tracking and escalation.
• Personalised relationship management to all
customers due to availability of customer
information and relevant sales and interaction
prompts.

• A comprehensive “single view of the customer” so that
our employees can engage effectively and credibly with
customers.
• A single system interface that makes user adoption and
training much easier and more effective.
• More productive sales and opportunity management
due to customer portfolio allocation and rigorous sales
management.
• Predefined sales campaigns and CRM programs to
increase cross sell and up sell as well as closed loop
marketing i.e. we will be able to accurately measure the
success of our initiatives.
• Improved collections and back office effectiveness due
to allocation and tracking of tasks.

• Process and workflow management will enable a
consistent customer experience.
• It will ensure faster turnaround times for account
• Document management which will minimise the use of application and fulfillment.
paper as well as reduce the storage and archiving costs. • There will be fewer mistakes due to the standardized
and automated processes
• Accurate customer reporting and real time tracking.

CHANNEL IMPACT VIA A CRM SYSTEM

Enhanced Knowledge Segregation of Tasks & Role
of Customer Based Access + audit trail
Building Customer
Retain & Manage Credit
Loyalty
Application &
Grow Manage Fulfillment
Manage
Campaigns Customers channel Manage & store
via a channel risk KYC
Manage Manage Verification
New and Security
Business Perfection
Effective operational
& channel Manage staff
Document productivity
management
management &
management &
workflow Monitor SLAs Manage service
requests

INTEGRATED CHANNEL VIEW/ARCHITECTURE EUPHORIA
Touch Customer
Core banking Data Customer Analytical Communication Optimization Point Touch
systems Integration Central Data Store Engine's Integration Point

Flat - Mobile
Exploration
Web servers Marketing
Unstructured warehouse
Flexible Exploration Campaign Application
Balance Servers
Holistic - 360 Customer Management Touch Point
View Statistical Delivery

Integration
CRM Single Point of Truth for Modeling
Customer Information Marketing Web Call centre
Predictive Data Mart Server
Relationship
Extract Modeling
Application Transform CRM Maximize
servers Load Credit Mart Long
Mart Lead Term
Group Single Generation Value & Messaging
Staging 1 Contact &
view by Interest
Interaction Email /
State
Card
Management Internet
management Change,
Events
Staging 2 Data warehouse Triggers or
Filters Opportunity Mail & SMS
other Customer
Exclusions Server
CR2 Techniques
Customer Snap shots & Best Offer
Segmentation History Right time
Staging 3
Preferred Snail mail
Other Channel
Single Auditable Internet
Flexi cube banking
core banking source Extract Traceable
system
Control
Meta Data
Business Rules Blackberry
Branch
Direct

CRM Strategy 3rd party
Customer BI and Reporting sites

BI Tools Reports OLAP Retention & Acquisition Units

Response Feedback - Closed
Loop

The “Learning Relationship” – Ongoing service excellence
Customer tells
Save you what he
me wants
time

FEEDBACK
You tailor your product,
service, or elements
associated with it

The more effort the customer invests, the greater
their stake in making the relationship work.

Now the customer finds it more convenient to remain loyal, rather than
re-teach a competitor

OVERVIEW MEASURE WHAT IS IMPT
CHANNELS SUCCESS will lie in the ABILITY to:
 ATTRACT/ACQUIRE
 RETAIN CUSTOMERS
 CROSS-SELL
 UP-SELL
 IMPROVE ON SERVICE
 UNDERSTAND WHAT IS NEEDED??????
 MEASURE PEOPLES PERFORMANCE
 DETERMINE EFFECIENCIES (SLA’S) & EFFECTIVENESS (PROFIT)
 CUSTOMER COMPLAINTS

Are we making PROFIT
176

SESSION 4: Fraud & Security Methods

OVERVIEW SHOW ME THE MONEY...
 Fraud, theft....have one thing in common.....PEOPLE/STAFF/BUSINESS PARTNERS
 Systems, process, checks & balances are important themes in building an effective
fraud management & monitoring system
 Fraud is dynamic and migrates across channels
 Integrated, multi-layered solutions better protect banks and customers assets
 Fraud prevention must be customer friendly
 ZERO tolerance culture (e.g. Nedbank in SA)
 Buildings alerts for the bank, and customers
 Risk management & Compliance
 Lack of integration increases FRAUD & RISK to a bank
 Technology (SMS alerts, SMS Pin)
 Getting sophisticated, & syndicated
 Flaws in manual fraud detection

178

PREVENTION IS BETTER THAN CURE DONT CATCH A COLD!!
 Staff education – they are the front line

 ZERO tolerance culture (e.g. Nedbank)

 Continually improve on the policies & processes

 Perform regular audits

 Leadership – visibility

 Investing in proper technology, cameras, etc

 Creating a hotline (staff/customers)

 Improving on authentication (layered approach – relate to PIN authentication SA)

 Invest in proper fraud solutions

 Creating a hierarchal approach on manual checks, balances and approvals (relate to case study when I set up 5 Ops centres
to manage 2000 Mobile staff, low fraud)

 Detection models when parameters have changed in a process, system, value etc

 Improve on resourcing

 Customer education (phishing & ATM Fraud)
179

OVERVIEW
 Overall brand equity

 ATL & BTL

 Campaign Management

 Branding in a multi-Channel approach

 Branding & segmentation

 Costs vs. ROI

 Customer experience vs. The Brand

 Various mediums including social networks

 Simple messaging (Capitec SA)

181

IN SUMMARY

S- STRATEGY
I - IMPLEMENTATION
M- MONITORING
P- PEOPLE
L- LEARNING FROM YOUR MISTAKES
E- EVALUATING

182

Channel strategy, v1, 2011

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Editor's Notes