According to Stephen Timcwell, (in New mechanism for a new age, The BANKER (http://www.thebanker.com/news/fullstory.php/aid/5179/New_mechanisms_for_a_new_age.html), in 2015 retail banking will still be concerned with its core role of supplying customers with help in paying for their purchases but the mechanics could look radically different.
Globally, banks have made some progress, but are still far from meeting consumer requirements and performance is highly varied.
It is difficult to personalise the offer in banking. There is a heavy managing mechanism behind. Personalising the offer in banking demands some heavy development in CRM, and some investment in informatics and in process innovation.
Banks are making progress in adapting their distribution channels to better meet customers needs, but what could be ‘the long tail’ in Banking / Credit?
The French leader in that domain is Cetelem, 50-years old customer-oriented credit institution.
The web site http://www.cetelem.fr/ gained spectacular visit rate very quickly after its launch in the 2000s and became the leader of the on-line banking services in France in August 2006 with 1 million single visits a day. It is an extremely simple, very ergonomic web-site, designed with the only aim to generate on-line demands of customers credits.
In a short time period, the ‘Net’ activity of Cetelem became essential for the group and Cetelem France decided, in the spring of 2007, to invest a lot of resources in the e-business department. The part of requests for credits generated by the Internet site became more and more important in the global production of Cetelem.
Why did it work so well?
Because of the ‘Long Tail’?
Every two or tree months Cetelem launches a new ‘special offer’ with an important communication campaign on TV, print media and build-boarding.
During the campaign the Marketing and CRM departments evaluate the ROI of those actions.
All the activity is focused on the new offer.
In the same time, they are still people that want to buy a car or build a new swimming pool in their garden. They are lost seeing the new offer displayed everywhere in the media, but not necessarily being the offer they need.
So, some of them visit the web site and finding here the offer named as their project (car, boat, renovation…), they don’t hesitate to make a request of a credit on-line. So, this way of selling credits is, in some way, more ‘personalised’ for the client … This is the same phenomenon of the ‘long tail’ that works well in the entertainment industry. In Credit and Banking the special offer of the moment could be seen as the ‘Blockbuster’ or the ‘Top 1’ of the music chart. All the marketing resources are concentrated on its promotion, but…there is a Mr. Everybody that needs his personalised, subjective choice.
In 2005 Cetelem France created an ‘In Vivo’ innovation unit in order to face the challenges of the fast-developing credit market. The ‘Labo’ works on some tests concerning the development of a better segmentation of the target and amelioration of some CMR processes.
It is just the beginning of the ‘long tail’ implementation in Banking and Credit. To be continued…