"Terabyte machoism" reared its head at American Banker's Customer Relationship Management conference last week.

Joel Friedman, a global managing partner at Andersen Consulting, coined the term in response to speakers who talked about the size of their data warehouses-the engines that support initiatives such as determining customer profitability and developing marketing plans.

Jack M. Antonini, executive vice president of First Union Corp., set the tone early on, noting that his bank's $33 million warehouse could hold 27 terabytes of information.

No bankers at the conference came close to matching that number, which is said to be the largest in banking. The Charlotte, N.C.-based bank plans to use the warehouse to store 13 months of history on 30 million accounts and 24 months of customer transactions.

Randall B. Grossman, senior vice president at Fleet Financial Group, said his bank's eight-terabyte warehouse would eventually hold 36 months of account history and 12 months of transaction history.

"Their customer base is about twice the size of ours," he said, referring to First Union.

Canadian Imperial Bank of Commerce needs only 800 gigabytes to hold 24 months of detail on its seven-million-plus retail customers, 300,000 small business customers, and 100,000 commercial customers, said Rick Miller, vice president, customer marketing.

Mary H. Kelly, president of the digital worldwide group of the consulting firm Foote Cone & Belding Inc., took a "less is more" approach, boasting of a 1.2 terabyte data mart that Charles Schwab & Co. built while she was there as a vice president, a post she held until a month ago.

"We did not build a $20 million data warehouse, we built a $2 million data mart," she said.

Norman W. Smith, executive vice president of consumer banking at Bank of Oklahoma, said his $6.7 billion-asset bank had a warehouse too.

"That's where we keep the maintenance equipment and supplies."

The machoism extended to success stories. Even without a warehouse, Mr. Smith was able to increase Bank of Oklahoma's profit per household by 5% in the first eight months of 1998. During that time, the bank's 88 branches increased their contribution to overall bank profitability by 7%.

Software from Dallas-based ActionSystems Inc. helped the Tulsa-based bank determine the profitability of customer groups and reprice account packages accordingly. The number of most profitable customers increased by 13% during the first eight months of 1998, and the least profitable declined by 5%.

Mr. Grossman said Fleet Financial, using its data warehouse, sent half as many mailings about its 1999 IRA offering as it did the year before, and received just as many responses.

It also sent 200 customized versions of letters informing customers of 12 Hartford branches that their branch would be closing. The personalized letters, which suggested alternate ways the affected customers could best bank with Fleet, considering their behavior, resulted in attrition that was "less than all the other branches in the network," Mr. Grossman said. "So our loss was zero. That's never happened before."

Mr. Miller of CIBC said a direct marketing effort to stimulate use of existing personal home equity lines of credit resulted in a 46.5% response rate and revenue of $32.7 million, versus a target of $6 million. "That's unheard of," Mr. Miller said.

Even with all the talk about manipulating technology, managing employees emerged as a more important requirement.

"We all worship at the altar of technology," said Henry H. Doss, senior vice president, sales and service at PNC Bank Corp. The problem is technology "is like a drug," he said. "It lures you into the notion you're actually doing something."

Customer relationship management "starts with human beings interacting with customers." He advised pairing technology with employee education and training.

David Pope, senior vice president at Wachovia Corp., said the "execution part" of customer relationship management plans get overlooked. "You're better off taking a B-level game plan and executing it at an A-level" than trying to improve the plan, he said.

He said Wachovia salespeople engage in an "amazing amount" of role playing, which has helped the bank increase sales of additional products to customers by 11% since January 1997, and retain virtually 100% of its most valuable customers.

Mr. Grossman said Fleet recognized the importance of acquiring and developing people skills early on. In 1996 it created a behavioral analysis division to provide direct-marketing consulting services to its business lines.

The division includes 16 business analysts, 18 systems developers, 16 technical employees, 19 programmer/analysts, 12 quantitative analysts with PhDs, and 17 data base marketing professionals.

Building the cost of this additional staffing into the original budget is "one of the things I'm most proud of," Mr. Grossman said. "We knew we not only needed to spend on technology, but to hire more people."

Fleet budgeted about $500,000 more each year to ensure it could hire professionals to maintain the value of its technology, he said.

"The last thing we needed after making a $33 million technology investment was to go cup in hand, asking for more money."

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