Majority of Banks Underutilize CRM
According to a March 2001 survey conducted by Core Group®, Inc., 76 percent of community banks and credit unions are not utilizing the full capabilities of their customer relationship management (CRM) and marketing customer information file (MCIF) systems.
The survey, sponsored by SEDONA® Corporation, — CRM solution provider for small- and mid-sized financial services companies — consisted of 53 in-depth telephone interviews with small- and mid-sized financial services companies including banks, credit unions, and savings and loan companies.
Other key findings included:
- Sixty-two percent of financial institutions did not have their CRM or MCIF systems networked within the organization. The lack of integration resulted in a limited number of users and decreased opportunity for integration into more than one department.
- The primary roadblock to full-system utilization is a lack of trained resources, resulting in nearly 40 percent of financial institutions stating that they are interested in outsourcing select CRM or MCIF functions.
- The most popular third-party CRM or MCIF services were planning and mailing implementation (40 percent); training (38 percent); profitability analysis (23 percent); and database tracking (23 percent).
- Eighty percent of financial institutions rate their systems as “very good” or “good” in regards to return on investment.
- Financial institutions do not have one standard measure for proving the success of their systems. Marketing response rates (35 percent), acquisition costs (26 percent), and return on investment (35 percent) are the most popular measures for defining the success of a CRM or MCIF system, but 40 percent of financial institutions used unspecified criteria.
- Eighty-eight percent of financial institutions with CRM or MCIF systems used those systems primarily in the marketing department. The most popular CRM or MCIF features were customer or account profiling (83 percent); improved marketing efficiency (83 percent); and analytical business intelligence (81 percent).
“Until recently, full-featured CRM systems were only available to larger financial organizations because of high implementation and deployment costs,” said Alyssa Dver, chief marketing officer, SEDONA Corporation. “However, with new Internet-based systems now available, the cost and ease-of-use allows smaller institutions to take advantage of full-featured CRM applications. These smaller institutions may be leveraging the solution for tactical request-driven activities, but often, they do not have the overall business knowledge or resources to take full advantage of their systems.”