Category Archives: Commercial Banking

Dashboards: Measure what Matters

The increased attention on marketing ROI and the customer experience has produced an increased interest in the development and use of dashboards in the marketing/CRM environment. The article “Dashboards: No Longer a Luxury” from 1-to-1 Magazine clearly points that out. The fact that everyone wants dashboards is positive, since measurement drives more informed—and therefore better—decisions, but the reality is that few succeed in creating dashboards that are truly valuable management tools. The pitfalls of most dashboards are that they measure too much which creates information overload and/or they measure the wrong things.

To be effective, dashboards should comprise no more than five or six measurements, which should be a blend of results metrics (e.g., sales, leads) and operational performance metrics (e.g., call resolution statistics, outbound call volume).

  • Results measurement should focus on the two or three numbers that will provide a “snapshot” of the health of the business/functional area. The numbers should be able to provide either an early warning of issues requiring intervention or reassurance of the state of the status quo.
  • Operational measurements should focus on quantifying the operational activities that drive positive results. For example, if you can correlate customer training attendance to customer satisfaction and repeat business, you should be monitoring training attendance rates.

Dashboards can and should be a valuable tool for management to understand at a glance the state of the business and the progress towards goals, but only if it’s focused on the right measurements.

Use of Incentives: Proceed with Caution

Effective use of incentives like coffee cards and gas cards requires both an understanding of the strategic context and a feel for customer behavior. A simple assessment (high/moderate/low) of key variables will provide a clear picture of the applicability and potential desired magnitude of a campaign incentive.

The three most important variables (and their assessment scale) when weighing the value of incentives are:

  • The strategic value of the action to the company (a “high” assessment supports incentive use)
  • The perceived benefit of the action to the respondent (“low” supports incentive use)
  • The barrier(s) to desired action (“high” supports incentive use)

For example, compelling responses to a web-based market research survey have:

  • Moderate strategic value since it’s several steps removed from revenue generation
  • Low perceived benefit to the respondent
  • A high barrier to action assuming the survey is more than a few questions long

Together, these ratings point to this being a solid use of incentives.

On the other hand, a poor application of using an incentive would be to drive someone simply to visit a website or respond to an email: the strategic value is low because providing an incentive trains the customer/prospect to respond to incentives rather than content, the perceived benefit to the respondent is moderate, and the barrier to action is low.

Falling marketing spend among financial institutions

Over the past year, most leading financial institutions have cut their marketing spend. As these firms face rising provisions for losses and declining revenues, they are look for other ways to cut costs, and marketing spend is squarely in their firing line.

bank_marketing_spend1

Banks are pursuing different approaches to cut marketing spend, including: altering the media mix to focus on less expensive media; and reducing/eliminating marketing of certain products (e.g., many banks have pulled back on credit card marketing over the past year).  In addition, banks should focus on getting the most from their marketing, by ensuring that it is synch with other aspects of their business, particularly sales.