One way Internet start-ups command high values on Wall Street despite having scant profits or none is by emphasizing the worth of their customers, and experts in customer relationship management say banks should do the same.

Some of them just may have to, since it is expected that stock analysts in the next 12 months will demand that banks supply more elaborate customer measurements. "There is only one profit center - the customer," said Robert Hall, chairman and chief executive officer of Customer Analytics, a Dallas-based provider of customer relationship management software.

A typical bank makes no money from most of its customers. That is why some banks are exploring CRM, whose techniques include putting customers into different delivery channels.

Rainer Famulla, an analyst at Arthur Andersen, said the new metrics that the Street will request from banks are embedded in CRM software. Mr. Famulla was among the speakers at American Banker's Customer Relationship Management symposium in Chicago last week.

Wall Street is likely to expand the required set of data to include the cost per customer and number of customers acquired per quarter, Mr. Hall said. Such measurements would augment the traditional measures of price to earnings, return on equity, net income, revenue, and expense ratios.

A survey by GartnerGroup Inc., a Stamford, Conn., research and consulting firm that specializes in business technology, found that large banks increased their investment in customer information systems by 30% from 1998 to 1999. Mary Knox, senior analyst for retail banking customer information management at GartnerGroup, told conference attendees that the number of banks offering relationship-based products increased by 50% during that time.

KeyCorp, Royal Bank of Canada, PNC Financial Group, and U.S. Bancorp, to name a few, have spent millions of dollars to license software, hire consultants, and implement training programs. The basic goal, Ms. Knox said, is improved customer retention, acquisition, and value through better knowledge of customers' product use and other behavior.

GartnerGroup has found that large banks' progress in CRM has been slow. Only 30% of such banks surveyed by the firm last year said their CRM program has more than paid for itself.

Ms. Knox said, "It is difficult to assess the value of a customer to a bank, because banks are expanding their own offerings, making customer relationships much more complex."

Mr. Hall of Customer Analytics said that type of complexity should not dissuade banks from using CRM. Rather, he said, that is another reason to use it.

"Customers are the most informative metric we have on how value gets created," he said.

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