SAS’s Dikshit believes that PSU banks are one of the biggest growth sectors for its CRM solutions

New generation banks like HDFC Bank have changed the rules of the game with their aggressive focus on technology. Today, as competition intensifies between not only the private players but also public sector ones, the focus has truly shifted to the customer. Buzzwords like CRM, which were hyped last year and then fell flat, have begun to surge today in sectors like banking. Vendors like SAS have begun to go more aggressively after the banking sector. The CRM major is betting big on its analytical CRM solutions, which it perceives will be a major hit in the Indian banking space.

Says Veera Dikshit, national sales head, financial services, SAS, “Today though most private and public sector banks have a fair understanding of the critical role played by CRM with respect to increasing profitability amongst customers, most of them still view customers as an account rather than an entity. This is seen from the fact that when a transaction takes place there is definitely a lack of knowledge in converting multiple transactions into data and using analytics to create knowledge that can help in appropriate cross-selling and marketing of products. This is where we believe our analytical CRM solutions can analyse and predict the most suitable and efficient channels for cross-selling activity.”

SAS is also betting big on the PSU banks getting more and more technology-savvy. Forced on the back-foot by the private banks, PSU banks are also waking up to the importance of customer orientation. While a majority of these banks have not made any significant investments in adopting CRM tools, a significant change in mindset is happening. Adds Dikshit, “Today empirical data proves that if you don’t have the appropriate tools, a bank can end up spending 40-50 percent more on acquiring a new profitable customer. With customer retention and increasing profitability from existing customers gaining importance in today’s competitive environment, these banks are increasingly turning to the idea of implementing CRM solutions. Another interesting thing to note here is that given their large customer base, PSUs can get returns ten times that of private banks from analytical CRM solutions.”

Banks using the CRM solutions can not only target their most profitable customers but also analyse and predict the exact mix of products to sell to a specific customer. In a market whose size is estimated to be close to Rs 100 crore, and which most industry analysts describe as crowded, SAS hopes to score over the competition due to its strengths in the analytics space.

Dikshit believes most of SAS’s competitors are still in the operational or collaborative management space and not in the analytical CRM space. Explains Dikshit, “While operational CRM software involves the process of interacting with prospective and existing customers, more efficient and collaborative CRM involves the application of collaborative services like e-mail, conferencing, chat and websites to facilitate interaction between customers and organisations. Analytical CRM goes one step ahead and answers important questions like which customers are profitable now, which of them could become profitable later and which channels do customers prefer to buy through.” By 2004 industry analysts believe that applications that have an inherent analytic capability will deliver a minimum of twice the return on the investment.