Making the Most of Multi-Channel Strategies

How to Get the Best Sales & Marketing to Work for You!

Making the Most of Multi-Channel Strategies

Frost & SullivanSales & Marketing Executive Summit East 2006

Boston Marriott Quincy

Agenda

• Marketing to a New Type of Consumer• Trends & Challenges in Multi-Channel Marketing• NetBank Case Study• Recommendations for Integrating Online & Offline Channels• Questions & Answers

Marketing to a New Type of Consumer

• Since 1997, traditional marketing mediums like TV, newspapers & magazine reading has declined 13%.– Internet usage increased 214% since 1997

• Internet veterans spent 10 more hours online compared to new Internet users– 84 percent of these extra online hours were spent on professional and

personal work.• 20 million wireless consumers evaluate carriers or manage their

wireless accounts online• 75 percent of auto buyers research their choices online• 60 million consumers researched a financial product or managed an

account online last year.

Marketing to a New Type of Consumer

• The Internet has liberated a new type of consumer– Technologically savvy– Know their value to marketers– Looking to own a piece of the action– They love to control and not to be controlled

• Online shopping is forcing companies to re-think their marketing, sales, service and business practices

• Two-way permission based marketing is the only strategy to reach the new consumer

Trends & Challenges in Multi-Channel Marketing

• Online sales are expected to rise to 329 billion by 2010• More retailers are offering consistent price on the Web and in stores

– Integrating on and offline channels is still elusive for many• Marketers and retailers are failing to understand consumers cross-

channel behaviors– “Channel Vision” – “Stove piped” and Fragmented

• Price is a big motivator for the online shopper– But price & product alone does not create a sustainable competitive

advantage

Trends & Challenges in Multi-Channel Marketing

• Marketing in the Clutter– Irrelevant and non-persuasive messaging

• Catering to regional consumer wants– Regionalized pricing, inventory management and competitive pressure

is the main reason why there is a disconnect between the Web & offline experience

• Catalogs have lost some ground as the principal marketing tool– Consumers use catalogs for shopping not necessarily for buying

• Lack of understanding consumer purchasing behavior• Lack of a true 360 degree view of the consumer

About NetBank

Retail Banking

Small Business Banking

Business Finance

Dealer Financial Services

NetBank Payment Systems

NetServ

QuickPost

PowerPost

NetBank Funding Services

Meritage Mortgage

Market Street Mortgage

Beacon Credit Services

Banking Financial Intermediary

Transaction Processing

The Retail Banking Landscape

• Sluggish deposit growth impacted by an inverted yield curve• Organic customer growth• Growing acceptance and higher expectations of online banking

capabilities• Data security and ID theft issues creating customer cynicism• Irrational money market deposit rates

NetBank’s Response to a Challenging Landscape

• Focused value proposition• Brand differentiation• Expanded website and online capabilities

– Alerts and notifications• Inbound Marketing Initiative• Improved customer service

– Comparative Differentiator

NetBank’s Response to a Challenging Landscape

Customers CAGR% X-Sell CAGR %

Base-Line 270,428 – 1.75 –

Grow Customersw/o X-Sell Growth 1,142,857 27% 1.75 0%

Grow X-Sellw/o Customer Growth 270,427 0% 7.42 27%

Do Both 500,000 11% 4.00 15%

Solving for NIBT in Evolutionary Financial Framework

Develop tactics to close the expected-vs.-actual gap (incorporate VOC and benchmarking)

1a. Review SLAs with hosting vendor1b. Minimize size of graphics to speed page loads

Determine actual customer experience

Determine critical customer touch points (aka, “Moments of Truth”) from customer’s viewpoint

“Interest Me” “Meet My Initial Need” “Keep Meeting My Needs”

Develop reward & recognitionfor achieving or exceeding expected customer experience

Develop appropriate set of rewards and recognition (for example: HERO)5

4

3

2

1

1a. Website available = x%1b. Website satisfaction = y2. Recognition factor = z

1a. Website available > 99.99%

1b. Website satisfaction > 4.5

2. Recognition factor > x

1. Marketing web site2. Advertisements

Crafting the Customer Experience: Customer Experience or Value Stream Mapping Example

Document Expected Customer experience (incorporate VOC and benchmarking)

Sales Fulfillment ServiceProcess

1. Apply by phone2. Apply by website3. Get notification of decision4. Close financial transaction

1. Account issue raise by phone or email

2. Complain by web mail3. Receive solution to complaint4. Hear about other products5. Take part in surveys

1a. Average hold time < 2 min1b. Application time < 10 min2a. Website available > 99.99%2b. Application time < 15 min

1a. Average hold time < 2 min1b. 1st time resolution > 95%

Inbound Marketing Strategy

Relevant : 5X Better

Numberof

CustomerInteractions

Time

Event-Triggered

Outbound Campaigns

Guided Inbound

Intrusive: 1-2%

Highly Targeted: 10X Better


• Evaluated data• Determined best method for interacting with the customer• Evaluated our sales/marketing approach• Developed a plan• Implemented a phased plan• Monitor activity and tweaked


• Customer segmentation– Segments based on age (7), balance (56), tenure (2), product

combinations (24), transactional data (6)– Created customer value index– Further refining data with demographic appends

• Multi-product relationships are more profitable and have lower attrition (4x less)

• Transaction-based relationships offer better cross-sell potential• Direct sales offer highest rate of closure


Call Center Channel

• Inbound calls– Turn service calls into sales opportunities– Guided closings based on:

• Offers already made• New offers available

• Outbound Calls– Event-based calls– Integrated with other campaigns


Call Center Channel Results

• New customer boarding (Q2 results)• 43.6% conversion rate for new products sold• Increased products/household from 2.11 to 2.55• 10% conversion rate -- unfunded accounts to funded


Outbound Email Channel

• Focused on branding, clear and concise messages• Promotions, surveys, newsletters and notifications• Targeted campaigns based on analysis of customer data – more

campaigns to smaller groups• Integrated with call center activities


Outbound Email Channel Results

• Average 107% increase in volume since 1/1/05• NetConnect Intro campaigns

– Avg. 55% read rate– Avg. 48% fulfillment rate

• Other campaigns– Avg. 45%-50% read rate– Avg. 5% fulfillment rate


Secure Bank Mail Channel

• Variety of banner ads on secure bank site• Current configuration displays based on customer profile (product

profile)• In process of moving to arbitration model



Next Steps• Phase II implementation

– IVR, ATM and Direct Sales

• Additional data appends• More analysis and refinement of offers• Tighter integration of offers across all channels• Continue to expand creative library and personalized campaigns

Recommendations for Integrating Online & Offline Channels

• Recognize that your customers are your scarcest resources– Engage your customer and be honest about your offerings

• Develop a strategy around your data– Integrate Customer Data Integration (CDI) & Master Data Management

(MDM) as part of your holistic CRM & SFA strategy– Must have a single version of the truth concerning the consumer

• Develop a true 360 degree view of your consumers and integrate disparate transactional systems

• Invest in change management and knowledge sharing


• Integrate business processes across your enterprise• Align Marketing & Call Center Operations

– Strategy Articulation & Value Stream Mapping– Consistent communications– Inbound marketing programs

• Add incremental value to your customer that goes beyond price & product– What is your “comparative” differentiator?

• Break down the silos within your organization


• Track & understand online customer behavior using Web analytic tools– Track visitor segmentation to understand how prospects/visitors behave

differently from the overall target audience– Interact with personas, their needs, and motivations, and uncover new

selling opportunities. • Allow customers to collaborate on your brand

– Example: Ban & ABSOLUT– Blogs and Search Engine Marketing (SEM)


• Focus on the “emotive” side of the consumer experience– Focus on an in-depth understanding of what the consumer values most

not just “operationalizing” the consumer experience• Implement personalized and relevant messaging across all channels

Questions & Answers

Art HallVP, Sales & Customer Care Operations, NetBankPresident, CRM Association (CRMA), Atlanta Chapter1015 Windward Ridge ParkwayAlpharetta, Georgia 30005Phone: (678) [email protected]