Citigroup's purchase of the UK-based Internet bank Egg could have a much bigger impact going ahead than the $1.13 billion deal would indicate, bringing not only new accounts and credit card balances into the fold but also introducing Egg's practical, active market research practices to a much broader audience.
As the global giant prepares to further absorb its new online lender, Egg customer experience management executive John Jennick is working with a team to figure how best to push its internal consumer tracking methods further into everyday business. That will be part of Citi's U.K. retail operations and sure to gain wider attention within an enterprise looking to remake itself from the ground up.
Egg uses a marketing research software suite from Confirmit, a vendor based in Norway and California, for 90 percent of its customer tracking, and has been doing so since 2002. Over the years it has used the in-house system to compile a record of consumer attitudes; it uses this experience to inform a constantly rolling poll operation of its customer base. It tries to get as personal as possible-pinpointing customer responses to actual individuals, rather than taking a small anonymous group and extrapolating from the sample.
In its modeling and research, Jennick says, it rejects the customer relationship management approach of rules-based systems tracking transaction patterns and mass balances in an effort to predict the future. Rather, it tries to move fast and be responsive to what customers say about their attitudes. Gary Schwartz, a Confirmit executive which has watched Egg develop how it uses the company's software, can point to a few instances of how that's making a difference in how the firm operates.
From the beginning Egg's been active in keeping in touch with customers, through e-mail or otherwise. Schwartz says the customer base is used to giving feedback to the firm on a regular basis. A couple years ago Egg started keeping data on an event-driven, rather than a periodic or scheduled, basis. "If someone contacted the call center, within 24 hours you might be asked: 'how did that call go,'" Schwartz says. "If it went poorly, within another 24 hours you'd be re-contacted. Within 48 hours after providing the feedback, Egg would be on the phone trying to fix it. ...Some customers were actually blown away by the idea that the bank actually did something with the feedback," he says.
Jennick says Egg still uses outside tracking and surveys, but that having nearly all of the market research in-house leads to speed and allows the company to organize around results. The firm introduced a new bank card, a hybrid credit/debit product, in the space of six weeks because it was able to go straight to the customer base in a space of 72 hours. If they'd outsourced to an agency, it would have taken weeks to get the initial data back.
Egg used Confirmit to help revamp its collections office as well. Using usual risk models and account data the firm identified at-risk customers and contacted them, saying "We need to talk;" it was a kind of marketing campaign. Egg took the approach that the conversation didn't have to be an awful one, however. It changed collections to "Borrowing Management" and figured, OK, skip a couple of payments, and then let's make sure we're on a schedule. The result was that the bank wound up being able to reduce loss provisions and increase the value of accounts.
The firm can quickly test assumptions, also. The firm wanted to understand what makes people happy with call centers, if and when that does happen. Egg execs figured that what customers really wanted was to get a person quickly on the phone. The options meant hiring more agents, or trying to get existing agents to speed up calls and take more volume. Instead, the feedback was that it's much more important for the customer to feel his time was well-spent: i.e., waiting a little bit is fine, as long as the person at the call center who eventually picks up is able to solve the problem.
Jennick says the Confirmit platform, which consists of a set of XML Web services and programmable ATI, integrates with back-office systems and allows real-time data transfer. "Now, we capture enough data. It's not a question of that. It's how do we integrate it with all the transactional data we have, all the attitudinal data," Jennick says. "It's about using the intelligence more cleverly."
It's worth noting that although Egg proactively gathers customer feedback, the 10-year-old firm never raked in money for ex-owners Prudential. As it becomes part of Citi what happens to Egg's principled approach remains an open question.
