| With today's business environment in a state of contraction and uncertainty, it has become a real challenge for financial services companies to maintain a lead over the competition. With over 1200 personal financial services companies competing in Hong Kong, PrimeCredit Limited recognised the need to devise and implement an analytical CRM solution that would help them establish a strong foothold in the local market and gain a competitive edge.
PrimeCredit recognises that it is not just important to understand their customers -- it is absolutely essential to know who to target in a marketing campaign and why. As a Director of Marketing for PrimeCredit in Asia, Daniel Chong realised that the most profitable way to acquire and retain customers would be to make use of an invaluable resource - customer data. The company therefore chose to invest in data warehousing and data mining technology supplied and supported by SAS Institute.
"An effective advertising campaign can raise the public's awareness of the company, but it might not bring us the business we desire. Hong Kong's financial services market is extremely competitive; customers are continuously subjected to thousands of advertisements every day, so we needed to adopt a more targeted approach," said Chong. "PrimeCredit is looking to acquire and retain customers by understanding their buying and payback patterns, while minimising bad debts and write-offs at the same time. It is extremely important for us to partner with a trusted vendor, such as SAS, to turn raw data into an intelligent tool for reducing credit risk and increasing revenue by selling new products to existing and potential customers."
"Due to the lack of local public information, it is difficult to go out and acquire ... demographic data the way companies can do in many other parts of the world. Therefore, the data we build up internally takes on exceptional importance. With the right approach, the correct infrastructure and the best analytical solution, we can use these data as a real resource that can give us a huge competitive advantage," added Chong.
"There has been obvious improvement in the response rate of PrimeCredit's direct mailing, because our marketing offers are now much more targeted. We have seen an increase in customer feedback after sending out only one-sixth of the previous number of mailers to selected potential customers," Chong said.
PrimeCredit evaluated multiple data warehousing and analysis software vendors for a period of six months before choosing SAS. According to Chong, the greatest advantage was its professional consulting services, coupled with SAS' flexibility and expertise in designing the credit scoring, customer retention and acquisition modelling. PrimeCredit has been partnered with SAS for two rewarding years now.
Since the implementation of the SAS solution to master its data access, management, analysis and presentation, the relationship between PrimeCredit and SAS has blossomed. Chong said that SAS' full-service consulting offered invaluable insight into how data need to be filtered and regrouped before being ready for quality analysis. "There's no point in analysing information irrelevant to our needs. It is important for us to have continuous on-site support from SAS so that every data discrepancy can be identified and fixed promptly," Chong emphasised.
Data mining segments PrimeCredit's customers into profitability groups to develop cost-effective service levels and targeted marketing campaigns. It also will be used to develop customer scoring and retention models in cross-selling and up-selling strategies. The data generated from the mining technology can provide relevant, reliable and timely statistics vital to planning and decision-making across departments.
Another advantage they gain with SAS data mining is the ability to conduct internal analysis on the profitability of its product and branches, allowing PrimeCredit to identify the under-performers and evaluate the ratio of operational costs to revenue generated by them.
"Data mining allows companies to address a wide range of business issues by generating questions we may never have thought of and revealing hidden patterns of customers' data," said Eddie Leung, director of Professional Services Division, SAS Hong Kong. "Using SAS solutions as business applications, PrimeCredit can transform raw data into a plan to improve reduce credible risk and increase revenues by providing new products that are suitable to existing customers."
In the near future, PrimeCredit plans to extend its customer acquisition services to the web. "I believe SAS, as a strategic partner, can continuously support us on housing and analysing customer data collected from all channels; call centres, retail branches and Web," Chong concluded.
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