The rapid growth of Internet users requires that technology be a key driver of business strategies, Arthur Kranzley, senior vice president of electronic commerce at MasterCard International, said last week.

Citing Gartner Group statistics in a speech at the Financial Technology Expo in New York, Mr. Kranzley said the number of Internet users is projected to skyrocket from 50 million now to 140 million by 2000.

Because "younger customers building wealth feel more connected to their PCs than their branch managers," he said, financial institutions must change the way they interact with customers.

Banks can use this phenomenon to their advantage, he said, by analyzing the data generated by Internet users to create targeted marketing campaigns.

MasterCard, for example, has created MC Online, letting its member institutions track consumer spending and card use patterns and develop marketing plans based on the information.

"Big banks can act and feel like neighborhood banks because they can customize," Mr. Kranzley said. He added that the Web also lets smaller banks reach millions of new customers.

As business units become more dependent on data, they must develop ways to share it across more departments. This would speed the creation and introduction of new products, Mr. Kranzley said.

"Data is the core of business, and the business units need it and must rely on it," he said. "The hierarchical way of controlling data and access doesn't work."

One hazard of increasing Internet adoption is the threat of disintermediation. Customers can bypass retail sales channels, travel agencies, even bankers by going directly to the source.

"The Net is creating a new self-service community" of consumers shopping for the best prices on the Web, Mr. Kranzley said.

The executive recently returned to MasterCard after three years at Advanta Corp., where he was responsible for business development and initiatives, including electronic commerce. He had previously spent 10 years at MasterCard.

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