Article

CRM at the ATM helps FIs attract, retain consumers

Customer relationship management is truly in its infancy, but change is on the way.

November 29, 2006 by Valerie Killifer — senior editor, NetWorld Alliance

With renewed attention on delivery-automation and channel-customization, ATM manufacturers and deployers are shifting their focus. ATMs, mobile phones and self-service kiosks are now able to up-sell, cross-sell, retain and attract banking consumers, all in the name of customer relationship management.

 

"Machines are going to emulate tellers over time," said Safwan Shah, chief executive of Santa Clara, Calif.-based software developer Infonox Inc. "They will not smile and shake hands, but they will know more about you."

 

Shah refers to CRM at an ATM or other self-service device as CMR, customer-managed relationships. CMR is controlled by the customer, Shah said, enabling the customer to control how he communicates with a business.

 

And financial institutions are increasingly concerned about how that interaction takes place.

 

At this point, it's no longer an option, says Paul McAdam, a senior managing director of research for Chicago-based Bank Administration Institute. During BAI's Retail Delivery Conference & Expo Nov. 14-16, McAdam discussed results from a national consumer and bank-executive survey BAI had recently conducted.

For years (FIs) have been trying to push customers out to the self-service environment, but they still want to feel like their customers are cared about.   - Brian Kett, Triton Systems

"The Relationship Experience" study includes information from more than 2,400 consumers and 450 banking executives. It focuses on the impact direct and personal consumer relationships have on an FI's overall profitability and long-term success.

 

"Banking product choices are increasingly fragmented among a wide variety of providers," McAdam said. "A greater return for banks could be realized by developing a strategy to cultivate relationships with customers who are most likely to be receptive, and insulate them against the encroachment of competitors."

 

Bank of the future

 

At North Canton, Ohio-based Diebold Inc., CRM is expected to play a pivotal role in the future of banking.

 

 

In Diebold's hypothetical "Branch of the Future," consumers are greeted and prompted through a series of transactions by interactive welcome stations. Transaction information and the consumer's photograph are sent to the teller, who is then able to address the customer on a more personal level.

 

One Hawaiian credit union has already adopted the "Branch of the Future" technology, said Jim Block, Diebold's director of global technology. Block said the technology is more efficient and promotes the idea of bringing transactions to the consumer.

 

"For years (FIs) have been trying to push customers out to the self-service environment, but they still want to feel like their customers are cared about," said Brian Kett, president and CEO of Long Beach, Miss.-based Triton Systems.

 

Kett said Triton has spoken with a number of companies that are trying to personalize self-service; but progress has been slow.

 

Building the type of customer relationships FIs want will require a strong management vision and a customer-focused culture, said Patric Timmermans, director of CRM product marketing for Alpharetta, Ga.-based Infor Global Solutions. And having a customer-focused culture requires CRM, at the ATM, online and within the branch.

 

Infor is a $2.1 billion software company that delivers enterprise solutions and standalone products to a wide range of industries, including the financial sector.

 

Infor in August acquired Extensity and Systems Union Group, big CRM players in the financial space, said Marsha Calfee, Infor's solutions architect. Now Infor works with recognizable FIs, including HSBC Mexico and NetBank Inc., to improve their CRM capabilities.

 

Infor's CRM Epiphany solution, like other CRM products, helps FIs pull all of their customer and member information together. What's unique, however, is that it pulls together and analyzes that data in real-time, on a regular basis.

 

"Epiphany tracks all of the information it takes in over time," Calfee said. "By tracking the customer profile, you can build things in, and the system does that."

 

With Epiphany, FIs aren't required to constantly change rules or update the system's logic. Frankly, Calfee said, they don't have enough time to do that - one reason why many have not yet moved forward with enterprise-wide CRM strategies.

 

What makes Infor's offering unique, Calfee says, is its self-learning-system solution and inbound marketing approach - a more reactive approach that first requires the consumer to initiate contact with the bank or credit union.

 

"They initiate contact and then we take that opportunity to offer them something that we think they might be interested in, based on the information they've provided," she said. "It's 10 times more effective."

 

Inbound marketing efforts at the ATM are very effective; in fact they're much more effective than when used through other channels, such as the call center, Calfee said.

 

"You're more likely to get better results when you respond to customers who are using your ATMs or the branch," she said.

 

But CRM has historically ignored customers and focused more on the automation and internal efficiencies, says Edmund Tribue of  MasterCard Advisors' Global Credit Risk Practice.

 

That's because FIs have not fully integrated their enterprises, said Infonox's Shah.

 

"True CRM cannot happen until all systems can talk to each other," he said.

 

 

 

 

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