Headquarters: Arlington, VA
Technology: Analytical Testing
Why it's one to watch: The technology tests the impact of new initiatives, providing a view of potential ROI beforehand.
One of the issues that resides alongside this fall's fight over new banking fees is that of consumer profitability. As fee income options for banks change due to economic and regulatory evolution, how do they retain their most profitable customers?
Banks that make it will be those that have the proper mix of personal and automated self-service across all channels. Also important will be optimized pricing strategies and marketing campaigns that resonate with the intended target.
Applied Predictive Technologies' Test and Learn Management solution uses an analytics engine to compute and gauge the impact of strategic initiatives in early stages.
"It's been a tough banking environment, and there's been an increase in focus on the mass affluent and how banks should successfully target those customers that have retained their profitability," says Anthony Bruce, Applied Technology's CEO.
For new bank initiatives, Test & Learn gathers data and runs computations on transaction and operational data. Computations typically test in-branch projects, the benefits of marketing campaigns, impact of new regulations on sets of customers. They can guage customer reactions to changes in pricing and rates.
APT recently expanded its technology to quantify the overall ROI of a campaign and view which customer segments are responding the best, allowing the bank to determine the best offer for each type of customer or decide whether to add private client bankers or relationship mangers in branches.
APT, which faces competition from business intelligence firms such as SAS, counts Wells Fargo, RBC, PNC, SunTrust and TD Canada Trust among its financial services clients. SunTrust has used APT to measure ATM and branch strategies. TD Canada Trust used APT to analyze call center data use it to guide decisions on outsourcing and how frequently it should reach out to customers during a campaign.
In 2011, the firm released APT 8.0, which automatically scans through transactional and operational data to detect changes in strategy, then quantifies the impact. For example, if a group of branches have changed their operating hours and staffing levels, the software will automatically detects the changes and analyze the incremental impact these actions have on new account generation and balance growth. APT's new media dashboard enables banks to see a view of all media activities (TV, radio, online) and quantify the ROI of each during a campaign.
