Software Finds Prospects In Customer Data Files
An increasing number of banks looking to improve marketing are turning to their customer information files for help.
A customer information file, or CIF, is a data base about customer relationships that includes information from various transaction-oriented systems, such as deposit accounting, trust, and loan servicing. Banks have long used CIF software in operations, but until recently few used it to increase revenue.
A new spate of software designed to use CIF data to improve the marketing of bank products has recently hit the market. Few measurable results have come back, but industry observers said bankers are putting the packages to use fast.
"It sounds silly, but many bankers are just realizing that the customer information they store on their computer systems is extremely valuable if they can manipulate it correctly," said Robert J. Buskas, head of the American Bankers Association's technology and operations division and an executive vice president at American National Bank and Trust Co. in Chicago. "Information a bank has always possessed can be turned into a strategic advantage."
The new software takes the data gathered by the main CIF system and sorts out the best cross-selling opportunities.
Cost: Up to $1 Million
Some software systems, such as the ones offered by Early Cloud & Co., Newport, R.I., are geared toward increasing sales to individuals. Others, such as Business Advantage software from Harte-Hanks Data Technologies, Billerica, Mass., enable bankers to identify their most successful commercial banking customers and target these businesses for sales calls.
Prices for these software packages range from about $90,000 to over $1 million, varying by the number of customers in the data base. Bankers said the packages typically pay for themselves in 12 to 18 months.
"We've used CIF marketing software on the retail side with marked success for about a year and a half," said Mark Kelly, a manager at Fleet/Norstar Bank in Providence, R.I. "It only makes sense to be doing the same thing with our commercial business."
The Harte-Hanks software that Fleet will install this month works much like other CIF marketing packages. After the bank's mainframe CIF software has gathered details on all of a customer's business relationships with the bank, the PC-based marketing software looks at the customer's financial position and suggests what profit-making products might be sold.
"In the case of small businesses, 10% of the companies generate about 90% of the profit banks get from commercial products," said Thomas Swithenbank, president of Harte-Hanks Data Technologies, a division of Harte-Hanks Communications Inc., San Antonio, Tex. "If you can identify what companies make up that 10%, you are going to be way ahead of the game."