In a 2006 BusinessWeek survey, 70% of respondents cited innovation as one their company's top three strategic priorities.

Until recent years, innovation was typically embodied in the development of new products. Today, however, no matter how innovative you may think your product is, you can bet that it will soon become commoditized.

Today, we view innovators as those who creatively apply products to enhance the customer experience. With this new definition in mind, in this edition of MarketScope we look at some of the innovative technologies that are helping financial institutions to achieve customer innovation.

Improving existing technologies

Web-site design
Forrester Research, in its 2007 white paper on Experience-Based Differentiation, found high failure rates in Web-site design. Among the 196 Web sites they've reviewed since 2005, the most common failures related to ease of use, task flow efficiency and the ability to recover easily from errors. Another shortcoming is that most information on Web sites of financial institutions focused on products and features rather than meeting customer needs. Forrester challenged financial institutions to upgrade their Web sites — to move from providing "brochure ware" to developing interactive learning centers that are intuitively responsive to customer needs.

E-mail marketing
The Direct Marketing Association in 2005 said e-mail marketing was five times as effective as other direct marketing vehicles, returning nearly $60 for every dollar invested. One reason for this high return-on-investment is that technology today enables personalization of e-mail regarding both recipients and sender, regardless of how many thousands of e-mails are sent in a single blast. What's more, technology built into today's e-mail platforms enables detailed data capture and tracking that provide an unprecedented insight into the interests, goals and challenges of each recipient-reader. This new marketplace intelligence makes it much easier to gather customer data and more effectively analyze the attitudes and buying proclivities of e-mail recipients. Furthermore, automated triggers built into more advanced e-mail tracking and analysis systems can instantly — and without manual intervention — provide additional information to readers who signal an interest in a particular topic. Such automatic triggers can dramatically improve financial institutions' ability to respond to the information needs of hot prospects without needing to increase staff.

New technologies
In the above-mentioned white paper on Experience Based Differentiation, Forrester also examined how some new technologies are providing a systematic approach to interacting with customers in ways that consistently build loyalty. Here are some of the highlights:

1. Analytics. Forrester noted how new analytics services by Actional, AmberPoint and IBM enable financial institutions to interact on a deeper level with their clients.
    
2. Business process management. Lombardi Software, Pegasystems and Savvion gave developed programs that automate and enable corporate users to more easily manipulate "business rules" when dealing with clients.
    
3. Rich internet media. SAS Institute, Siebel and Unica provide more interactive business tools and educational content to help banks communicate more effectively with their clients.
    
4. Service oriented architecture (SOA). Companies like Actional, AmberPoint and IBM provide solutions that enable users to easily integrate applications and share customer information across the entire bank enterprise.

In its 2006 white paper Organic Customer Growth for Financial Services Institutions, SAS described its vision for a new enterprise-wide, integrated intelligence technology platform. SAS is one of a number of companies dedicated to developing technology that assists financial institutions in achieving a "single view of the customer," a view that transcends longstanding information silos still in place at most financial institutions. SAS' services include centralizing customer data, developing customer profiles for predictive buying analysis, price bundling, identifying and engaging high potential customers and prospects, and finally, creating banking-specific customer retention models that also support segmentation and cross-sell/up-sell models.

Similarly, Eloqua has developed a system that integrates information for more in-depth customer insights. According to Eloqua, when you reach prospects and clients through multiple media and with multiple frequencies over time, your messages are reinforced and recipient responses tend to be stronger. Accordingly, marketers are likely to have far better results if they can reach their prospect with a combination of an e-mail, a phone call and a direct-mail contact than if they used only one of those channels multiple times.

To facilitate this multi channel approach, more banks are using integrated demand generation platforms. These platforms enable banks to plan, execute and then measure the effectiveness of their multi-channel campaigns.

Demand generation applications integrate and synchronize a whole spectrum of offline and online marketing channels, which include e-mail, direct mail, advertising, the Web, call centers, and trade shows. These also include contacts by both bank sales representatives and business affiliates (for example, technology providers who offer their services through a bank).

With these types of multi-faceted solutions, bank marketers are doing more than communicating with prospects. They also are closely monitoring and reacting to the implicit buying signals in each prospect's response to marketing messages. Signals that prospects send include visits to bank Web site pages containing information about specific issues, products and services. Prospects also send signals when they register for bank-sponsored events or download white papers or other content from your bank's Web site. All these signals provide intelligence your sales representatives can use to provide more relevant follow-up with prospects and thus accelerate the sales cycle.

 
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FPS regularly works with financial services companies to maximize the impact of their client communications, including e-mail and online communications. To find out how we can help you develop effective strategies for communicating with corporate financial executives, contact FPS President Vince DiPaolo at 847-501-4120 or [email protected]. You can also write him at the following address:

Financial Publishing Services Co.
464 Central Avenue
Suite 8
Northfield, IL 60093

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