Maybank BWP 2

BUSINESS WHITE PAPER / FINANcIAl INdUSTRy

MAYBANK We’re Banking on Customer Engagement.

EB-6274 > 1110 > PAGE 2 OF 17

Maybank / We’re Banking on Customer Engagement.

TABLE OF CONTENTS

Executive Summary

Around the world, banking has become a relationship-driven business. Products are essentially viewed as commodities, and competitors are quick to match aggressive rates. But relationships between customers and the financial institutions that serve them can act as a solid building block for success. For this reason, Malayan Banking Berhad (Maybank), a leading banking group in Southeast Asia, shifted its competitive strategy. Instead of concentrating on the products it can sell consumers, the bank now focuses on building and servicing customer relationships.

Headquartered in Kuala Lumpur, Malaysia, Maybank serves more than 18 million customers and employs nearly 40,000 people. The bank holds total assets of RM 336 billion (USD 108.6 billion) and is the largest financial services group in Malaysia. Maybank offers an extensive range of financial products and services, including commercial, investment and Islamic bank-ing; internet and offshore banking; insurance and asset management; and trustee, stock broker, and venture capital services. The company is ranked first among Malaysian brands by Brand Finance in its Global 500 survey and 118th in the world by The Banker magazine.

In 2010, Maybank celebrated its 50th anniversary. But bank executives recognized that maintaining the company’s success required new competi-tive strategies. Given the industry’s commoditization of banking products, Maybank wanted to make strategic changes designed to enhance the con-sumer experience and improve the bank’s relationship with its customers. Company executives set a course designed to help the bank to evolve into a customer-focused firm. The goal was to enhance the bank’s understand-ing of individual customers and improve each customer’s experience during interactions with Maybank. By driving a new business directive, company executives envisioned a direct path to improved customer loyalty, retention, and profitability.

To provide the system support needed to achieve this goal, the bank launched a new Analytical Customer Relationship Management (aCRM) project in 2007. The goal of aCRM was to help the marketing organization better understand Maybank’s customers by communicating with them at the right time, using the right channels. To meet this goal, Maybank deployed a Teradata system and Teradata® Relationship Manager software.

Executive Summary . . . . .2

Background . . . . . . . . . . . .3

The Catalysts for Change . . . . . . . . . . . . . . . 5

Implementation . . . . . . . . .8

Results and Conclusion . . . . . . . . . . . . 14

EB-6274 > 1110 > PAGE 3 OF 17


Together, the Teradata products create an effective founda-tion for centralized campaign management and event-based marketing capabilities.

The initial aCRM project yielded dramatic value, driving business growth and increasing customer satisfaction. Using the Teradata solution, Maybank increased marketing campaign success rates tenfold. Lead generation times were slashed from weeks to hours, new campaign time to market was cut from weeks to days, and the average conversion rate jumped from a low of 0.3% to an average of 8% and a high of 30%. From the commencement of the project in August 2007 until late 2009, Maybank gained RM 3.0 billion (USD 961 million) in new sales.

The company views the aCRM initiative as a successful and ongoing journey, while continuing to identify oppor-tunities to increase its return on investment. Along with its impressive results, Maybank has also won numerous awards for its aCRM program and its progress. The follow-ing programs and their results, which are among the most successful of Maybank’s aCRM efforts, are the focus of this case study:

> Centralized campaign management focuses on campaign development and execution to optimize revenue and drive increased business.

> Event-based marketing (EBM) uses call centers, branch networks, and other channels to reach out to customers in planned campaigns at the most opportune time.

> Customer segmentation divides customers into target groups that optimize service and increase retention.

> Data mining and business intelligence provide a 360-degree view of customers, enabling analysts to accurately identify revenue opportunities, enhance sales channels, mitigate cost risks, leverage valuable data, and optimize contact management.

BackgroundIndustry leadership, innovation, and customer focus drove Maybank from its inception. Incorporated in 1960, the bank opened more than 30 branches and an overseas division within a year. Over the decades, it was the first in Malaysia to offer new services such as computerized banking opera-tions, a shared ATM network, telephone banking, Islamic banking, an online enterprise portal for businesses, and mobile finances, to name just a few.

However, in the mid-1990s, the Asian financial crisis and subsequent economic downturn created severe disruption for many Southeast Asian financial organizations. Subse-quent deregulation of the financial markets led to a multitude of new competitors. Many were foreign banks, which changed the primarily local nature of Malaysian banking to a more international business. Consumers, worried about the staying power of their banks, hedged their bets by diversify-ing their accounts. Even now, most customers in Malaysia hold multiple bank accounts with numerous institutions.

In recent years, Maybank increased its focus on product innovation. The company introduced offerings designed to enhance the financial well-being of its customers, such as

Maybankoperates1,750officesin14countries,includingSingapore,Indonesia,Philippines,Brunei,Vietnam,Cambodia,China,UnitedKingdom,UnitedStates,Bahrain,PapuaNewGuinea,Pakistan,andUzbekistan.Thefirm’sIslamicbankingbusinessdominatestheAsiaPacificregionandisamongtheworld’stop15Islamicbanks.Thecompanyisalsoaleadinginsuranceproviderandinvestmentbank.

EB-6274 > 1110 > PAGE 4 OF 17


third-party electronic bill presentation services, a structured capital guarantee deposit product that invests in asset classes with a focus on the sustainable sectors, and the Foreign Currency Mudharabah-i (FCM-i) account, the coun-try’s first short-term Islamic foreign currency term deposit account based on the principle of Mudharabah.

These efforts yielded excellent results. The organization is now the largest bank insurance provider in the region, and its internet banking operations hold a 50% market domestic share. Maybank operates 1,750 offices in 14 countries, including Singapore, Indonesia, Philippines, Brunei, Vietnam, Cambodia, China, United Kingdom, United States, Bahrain, Papua New Guinea, Pakistan, and Uzbekistan. The firm’s Islamic banking business dominates the Asia Pacific region and is among the world’s top 15 Islamic banks. The company is also a leading insurance provider and investment bank.

Maybank’s vision is to become a leading regional financial services provider by 2015. Achieving this goal requires a

renewed focus on delivering innovative products as well as the ability to offer a superior value proposition to customers. In the hyper-competitive Southeast Asian banking market, this is no small challenge.

“The pressure on banks in this region is tremendous,” explains Mohd Fadzil Bin Ismail, head of CRM for Maybank. “To attract consumers requires more than just innovative products. Products can be copied, and pricing can be reduced by aggressive competitors. We must also look at the timing and the way we communicate with our customers. Building a valued relationship by identifying and under-standing their needs is the best way to attract and retain customers.”

To make the transition from a product-centric bank to a customer-focused organization, Maybank needed a new technology solution that could strategically leverage the right customer information at the right time. Specifically, the bank wanted to create a CRM solution that would:

> Analyze and promote understanding of customer behavior.

> Use data to predict and influence customer behavior.

> Conduct effective communications to improve customer acquisition, cultivation, retention, loyalty, and profitability.

> Creatively use multiple customer touch points as part of the business strategy, optimizing the multi-channel, multi-step approach to reach customers.

To support the transformation of the business, the organiza-tion initiated the Maybank aCRM project, using Teradata technology and Teradata Relationship Manager software as the foundation for change. The project, initially supported by the head of Consumer Banking and En Fadzil, the head of CRM, was lead by the CRM Team. Critical participants also included the telesales and branch departments, as well as the bank’s product teams.

“Thepressureonbanksinthisregionistremendous.Toattractconsumersrequiresmorethanjustinnovativeproducts.Productscanbecopied,andpricingcanbereducedbyaggressivecompetitors.Wemustalsolookatthetimingandthewaywecommunicatewithourcustomers.Buildingavaluedrelationshipbyidentifyingandunderstandingtheirneedsisthebestwaytoattractandretaincustomers.”

Mohd Fadzil Bin Ismail, head of CRM for Maybank

EB-6274 > 1110 > PAGE 5 OF 17


The catalysts for changeMaybank needed a single, centralized view of its customers. To meet this goal, the bank needed a business solution that could help users:

> Connect with all relevant sources of data.

> Gain insight into the content, quality, and structure of data sources.

> Standardize, cleanse, and harmonize data.

> Collect, transform, and enrich high volumes of data.

“To understand our customers better, we needed a new marketing technology,” says Fadzil. “So we plotted a journey to move toward that goal.” (See Figure 1.)

The company considered using its existing group data warehouse (GDW) to support its CRM initiative, but identified several capabilities gaps. The Oracle-based GDW had

limited marketing functionality and no proven record of scalability. It stored profitability model and risk management data only at an aggregated level. The GDW was unable to support centralized, automated management of multiple campaigns, monitoring of lead statuses, or end-to-end, close-looped campaign measurement. Handling increased or complex workloads – such as tactical and strategic queries – led to dramatic performance degradation. The system was too inflexible to handle multi-dimensional analysis. The system could generate only static reports, and those required one to two weeks to generate.

“The data warehouse was built to provide only financial reporting and profitability models,” says Fadzil. “It was never meant to be used by marketing. We needed a CRM solution that would support faster, further progress than the Oracle system would allow.”

Figure 1. Maybank CRM Journey

ProductFocus

Di�erentiatorBased on 5 Ps

Sales IncentivesDriven

Di�erentiator Based on 5 Rs Interactive Marketing: Relevance, Receptivity, Recognition, Responsiveness and Relationship

Walk-InProspecting

Walk-In and LeadsManagement Prospecting

Customer Portfolio Management Approach and Full-Blown Customer Management Strategy

A&P andMass Marketing

Target Marketing with Limited Marketing Automation

and Closed-Loop Process

Full Marketing Automation and CCMS with Multi-Channel and Multi-Step Capability Using EBMs

Research for ProductDevelopment withLimited Analytic Analytic

Apply Customer, and ProductAnalytic Using Profiling andBasic Segmentation MethodAnalytic

Robust Analytic for Customer, Product, and Portfolio Analysis Using Modeling, Prediction, and Advance Segmentation with Application of Statistical Methodologies

Sales and MarketShare Focus

RelationshipFocus

< 2004 2004 - 2007 2008 - 2012

cRM Journey

EB-6274 > 1110 > PAGE 6 OF 17


Maybank identified three main objectives for its aCRM system:

> Harness technology to support the transformation of the bank into a customer-centric entity. Find a solution that would support the shift from a product-push sales model to a culture in which bank employees offer financial products and services based on customers’ unique requirements.

> Create a closed-loop CRM system. By including data on customers, transactions, channels, time, and place in the iterative process, Maybank could apply new market-ing and business insight to revenue generation and cost reduction initiatives.

> Build a robust infrastructure that could centrally and automatically manage multiple campaigns, enable EBM

capabilities, support advisory-led sales, and report by leads, channels, and sales. Maybank wanted to perform customer analysis at a granular level and generate behav-ioral analysis from credit cards, savings data, and current account transaction levels. The new system needed to help the bank create a full campaign automation process with channel integration and enable measurement of ROI and campaign effectiveness.

To meet the objectives, the Maybank team created a three-part deployment road map for the aCRM system (see Figure 2):

1. A pilot phase, including EBM assessment and pilot deployment, designed to prove that aCRM could gener-ate additional, significant revenue

Figure 2. Maybank aCRM Roadmap

Pro

cess

es

PHASE 1 (Pilot) PHASE 2

2006-2007 2008-2009 2010-2011 2012

PHASE 3 FULL

Sales Transformation

Org

aniz

atio

nal C

apab

iliti

esan

d P

eop

le CRMSegmentModeling

Enterprise EBM, ACRM andCampaign Processes

OrganisationalAlignment CRM Acceleration Increasing Ownership by Maybank

Agree FutureState

Assessmentof Skiils

Identify Gaps,Agree Metrics

Reports

Design Programand Pilot Training

Deploy SalesTraining and

CRM-Based KPIs

CRMSegment

Strategies

CRMTeam

PILOT EBMProcess

Strengthen Roleof CRM Team

Align ACRMand OCRM

Review Data QualityProgram

OperationalModel Scoring

Execute NewSales Processes

Relationship / Segment-BasedPackaging and Pricing

Bus

ines

sIn

terf

ace

BI Toolfor GDW

TCRM External CustomerInformation

All Customers,All Branches

All Channels,Enterprise-wide

Data

More Campaigns,KL Brances, DM

Customer ManagementProcesses

Deployment of CRMSegments and CustomerManagement Processes

NextTranformation

Agenda

KPI Dashboard and FSIReporting Apps

Additional SalesTools

OLAP Tool acrossOrganization

Info

rmat

ion

Tech

nolo

gy

and

Infr

astr

uctu

re

GDW

Deposits

Marketing Datamart

LoansCredit Card, E-Pointand Channeln

Insurance,Investment

High-level Road Map

EB-6274 > 1110 > PAGE 7 OF 17


2. Phase 2, releases 1 and 2, to introduce program design, employee training, new customer segmentation and marketing processes, and data mining capabilities

3. Phase 3, a project extension that integrates new channel and data sources and supports multi-step campaigns and a multi-channel environment

To bring its aCRM roadmap to life, Maybank chose to deploy Teradata solutions. Bank personnel were familiar with Oracle data warehouse technology, but dismissed that solution because it lacks a powerful analytical marketing function and was unable to support big data volumes. May-bank excluded IBM because its solution lacked business intelligence functionality and the company could not provide the required consulting services. SAS offered data mining

experience, but was discounted because of inexperience handling the huge data volumes common to Maybank. “We were looking for a long-term solution, and we knew Teradata was the best choice to meet our needs,” says Fadzil.

Avoiding Pitfalls along the acRM Journey

The road to executing a major business transformation through the aCRM deployment included many potential pitfalls. Mohd Fadzil Bin Ismail, head of CRM for Maybank, described how the bank avoided common obstacles:

> Executive buy-in: “We had to explain to our corporate leaders why we needed to do this. Fortunately, executives appreciated the use of analysis in other markets That helped bank leadership understand the benefits of having the aCRM solution.”

> channel commitment: “We couldn’t integrate into the channel systems or execute end-to-end campaigns without the cooperation of the channel network. With the support of senior management, we were able to integrate into the two key front-end channels, telesales and branches, at the start. This allowed us to provide closed-loop capabilities and automate the full campaign process.”

> Technology understanding: “Business users did not under-stand database fundamentals or how to build a strong data mart capability. We took time to gain a fundamental knowl-edge of data warehousing best practices, and we made sure that our colleagues from IT also understood how to support the technology. If we hadn’t done that, we might have built a solution that created more problems than it solved.”

“Teradataalwaysprovidesuswithbusinessconsultantswhowerebankers.Theyunderstoodourindustryneeds.Theirexperiencehelpedusreduceourlearningcurveanddeploythesolutionfaster.”


> Resource limitations: “Our IT manage-ment was being outsourced, and local IT resources in Malaysia can be scarce. We decided to directly contract with vendors who have experience running business ana-lytics programs in other markets to build our aCRM capabilities, rather than investing more to have it done under a procurement arrangement by software providers.”

> change management: “Our main barriers to success were those encountered in the areas of people and change management. We used techniques to help bankers develop an advisory-led approach that they could use with our customers. We measured participation of the channel agents to determine which bankers required additional coaching to improve their performance, and we rewarded excellence.”

EB-6274 > 1110 > PAGE 8 OF 17


Teradata’s ability to process exceptionally large volumes of data was a key factor in the decision. The company’s demonstrated expertise in database fundamentals – includ-ing parallel processing, third-normal form data, and the concept of creating and meeting service level agreements – was also essential. Furthermore, Teradata’s expertise in the financial services industry, as demonstrated by its many customers in the banking industry – convinced the Maybank team that it had found a worthy partner.

“Teradata always provides us with business consultants who were bankers,” says Fadzil. “They understood our industry needs. Their experience helped us reduce our learning curve and deploy the solution faster.”

ImplementationIn 2007, Maybank began creating the architecture for the aCRM system. (See Figure 3.) The marketing data mart serves as the foundation for analysis, customer communica-tions, EBM, and traditional marketing campaigns. Parallel processing ensures high availability and rapid performance, which supports quick decision making.

The system stores approximately 1.6TB of data at a granular level, in third-normal form, based on the Teradata Financial Services Logical Data Model (FS-LDM). The financial services LDM accelerated the implementation, allowed Maybank to leverage Teradata’s experience with other banks around the world, and provides a database structure that can support many different applications and needs in the future. Data sources include the GDW and the bank’s source systems, which provide information on accounts and transactions such as investments, loans, and deposits.

Figure 3. Maybank aCRM System Architecture

Phase 1

Phase 2

Phase 3

Phase 3:New Source Systems

AllCustomers

Data Sources Marketing Datamart Delivery Channels

Phase 32.5 MillionCustomers

Development

UAT

Production

1.5 MillionCustomers

Phase 2:Source Systems

Phase 1:Source Systems

MM

SMF

ePointCARE

BPITrax

ePoint-MGCC

MobileBanking

M2U

EtiqaOneline

Securities

Risk

ATM/MEPs

Loan Trxn

Merchant

Etiqa

APS

HP MARS

WOLOC

OCCIS

CCRIS

MAS

Credit CardDatamart

FADS

DWH

• Product and Portfolio Analysis• Alerts• MIS

ETL

Oracle ODI

Phase 1:4 EBM Campaigns,

RA

Phase 2:5 EBM Campaigns,

RA

Phase 3:More Campaigns,

Multi Steps,Multi Channels,Near Realtime

LeadsDelivered

MQ

Phase 3

MQ

Branches

Call Centre

Direct Mail

Data Mining (2 Models)

SegmentationData Profiling

Score CardCustomer Statistics

2.5 Million Mass A�uent / HNW6.0 Million in Staging Server

SMS

eMail

Internet

ATM

Mobile Sales

M2U

SiebelEtiqa Oneline

• Segmentation to drive acquisition, usage, retention, up-selling, cross-selling, and loyalty• Database Marketing

•

•

EB-6274 > 1110 > PAGE 9 OF 17


Maybank uses Oracle Data Integrator to support its ETL process, moving data from source systems into the market-ing data mart. “We load the data in seven nightly batches, from 6 p.m. to 7 a.m.,” says Mohd Faizul Bin Abd Manap, head CRM technology for the CRM team. Another five batches are loaded on a monthly basis.

Now Maybank can create a singular view of all customers. “Each customer is assigned a unique number,” says Fadzil. “No matter whether the customer is interacting with a branch office, the internet, or a call center, we can recognize and identify that person. We can see which products they have and when they opened an account.”

Because the data is stored at a detailed level, Maybank can easily track transactions and understand the source of the data. “When we stored only aggregate data, we couldn’t see detailed transactions,” says Fadzil. “Now we can see where the data is coming from, which enables a better view

of each customer – how much he spends, which accounts she holds, and which channels they buy from. Thus the behavior pattern can be established, and that enhances our predictive modeling initiative.”

Feedback from the channels is fed back into the market-ing data mart. This structure enables a closed-loop CRM process that incorporates response and success detection, post-communication analysis, and planning for the next-best communication. (See Figure 4.)

Maybank completed Phase 1 of the deployment in just six months. A three-month pilot – adding data on deposits, loans, and customer product holdings – followed. Two EBM campaigns were conducted across 10 branches and five telesales offices. The CRM team performed quantitative and qualitative measurement monthly, helping the organization refine its campaigns and gain greater understanding of the new system.

Figure 4. Closed-Loop CRM Process

MarketingAutomation

MarketingData Mart

DataWarehouse

EBM

External Lists(Prospects)

DataMining

CustomerInfo

Batch Load of Customer andAccount Information

SalesLeads

Responses

MarketingLists

Customers’ Interactions

E-Points Database(Call Center and CARE System)

Closed Loop

M2U (Web)Database

E-Mail

Direct Mail

ATM

SMS

ClosedSales

SourceSystems

Customers

Channels CCMS

Positive andNegative

Responses

ETLProcess 2

3

4

1

5

EB-6274 > 1110 > PAGE 10 OF 17


In all, nearly 9600 customers were contacted during the pilot, with returns that were five times better than traditional marketing efforts. “The pilot results were very successful and demonstrated a significant ROI,” says Fadzil.

During the seven-month Phase 2 of the project, Maybank added new data sources, such as credit card and credit score data, as well as new channels. The CRM team executed more than 1,600 campaigns and developed new customer segmentation, churn, and next logical product models.

Maybank aCRM Applications

Maybank uses the aCRM system to support a variety of marketing-related applications. The new environment includes a full campaign automation process with channel integration, providing an avenue to create business oppor-tunities using cost-effective database marketing practices. It also enables a closed-loop marketing process that supports campaign refinement.

The rich, granular data is ideal for statistical analysis and building business models. Maybank has already built models for propensity to buy, churn analysis, cross-selling, up-selling, segmentation, predictive modeling, profitability, and channel optimization.

The integration of various channel data and analytic engines give users dynamic ways to view, discover, plan, commu-nicate, and optimize relationships. More than 25 business users with analytics skills access the system to support the bank’s marketing efforts – an increase from the three power users who were technically skilled enough to use the old system. Navigating between functions is fingertip-fast, for rapid analysis-to-execution time. Another 23 workers use the system to view reports or explore data. In addition, sales leads generated using aCRM are distributed to 400 bank branches, 109 call agents, and more than 1000 sales representatives.

Channel integration provides a concrete base to support single-step campaigns as well as multi-step, event-triggered, multi-channel communications – offering the fastest, smart-est ways to understand and create meaningful conversations

with individual customers. “With our old system, it took days or even months to extract customer information,” says Fadzil. “Now users can get that data in minutes or seconds. That difference positively impacts our time to market.”

Centralized Campaign Management

The aCRM system supports centralized marketing campaign development and execution. Campaigns typically focus on optimizing revenue and driving increased business.

Campaign management support is provided to many busi-nesses and channels within Maybank, including: funding and retail lending, mortgages and personal financing, cards and payment systems, bank insurance, wealth manage-ment, virtual banking, operational support, planning and budgeting, Islamic banking, data quality initiatives, group insurance, and strategic alliance and affinity programs.

CRM team members develop campaigns using Teradata Relationship Manager 6. They generate campaign target lists based on data analysis and identification of specific events. Teradata Relationship Manager 6 allows team members to control the distribution and timing of leads as well as the measurement of results.

“Before the aCRM system, we had to rely on IT for help get-ting customer information,” says Fadzil. “Any slight change in our business rule or script would delay the process further. Now our team members can change process rules as needed, without help from IT.”

“Withouroldsystem,ittookdaysorevenmonthstoextractcustomerinformation.Nowuserscangetthatdatainminutesorseconds.Thatdifferencepositivelyimpactsourtimetomarket.”


EB-6274 > 1110 > PAGE 11 OF 17


GDW

Source Data

Marketing Datamart Delivery Channels

Branches

E-Mail

Internet

Call Centre

Direct Mail

Centralized CampaignMarketing System

(Design, Build, andExecute Campaigns)

Marketing Automation

Data Mining

Ext

ract

s

Lead

Man

ager

FRAUD AMLA

Campaigns can be executed in multiple steps, across one or more channels. The multi-channel capability allows Maybank staff to leverage its call center and branch network today. Future channels will include internet, email, and direct mail. (See Figure 5.)

Campaign lists are distributed to channels in one of two forms:

> Via internal contact management systems, such as the telemarketing centers.

> By email to those without access to the contact manage-ment systems, such as mobile lenders.

“Campaigns are fully automated by the system, which means that it is easier to use,” explains Mohd Khair Bin Abu Bakar, head national lead for CRM. “We’ve received greater buy-in from our users because of this enhanced ability to use the system.”

Maybank telemarketers, branch agents, and mobile lend-ers use the campaign management system to contact customers by telephone. The marketing team developed open dialogue campaign scripts to assist the bankers and telesales agents with an advisory-led sales approach.

“Before aCRM, our campaign communications would be based on product lines or campaign duration,” explains Noazrul Hisham Bin Abd Zawawi, channel readiness national lead for CRM. “Now we are leading with messaging on relevant choices customers should make, which lets us offer good advice and help our customers.”

The centralized campaign management functionality also supports the following activities.

> Customer acquisition: By predicting next or future inten-tions, aCRM allows Maybank analysts to better understand a customer’s propensity to buy. In addition, predictive mod-eling functionality matches new prospects with products.

> Cross-selling: Analysts use the system to associate products with likely customers and understand the impact of customer life cycles on purchases. They can also predict new purchase requirements based on changes in customer usage and buying behavior.

“Campaignsarefullyautomatedbythesystem,whichmeansthatitiseasiertouse.We’vereceivedgreaterbuy-infromourusersbecauseofthisenhancedabilitytousethesystem.”

Mohd Khair Bin Abu Bakar, head national lead for CRM

Figure 5. Centralized Campaign Marketing Information Flow

EB-6274 > 1110 > PAGE 12 OF 17


> Up-selling: The aCRM system supports loyalty and reward programs that encourage new purchases. For example, analysts can design campaigns to encourage customers to purchase additional investment products, increase loan amounts, receive extra funds to cover cash flow needs, and meet new insurance needs.

> Customer retention: Maybank uses predictive modeling to identify highly profitable customers at risk for attrition. Analysts can enhance customer retention by offering loyalty pricing and rewarding frequent users with rebates and discounts. Periodic marketing messaging is distrib-uted to encourage profitable customers to participate in relationship banking.

> Alert system: Maybank uses the alert functionality to drive enhanced customer knowledge and proactive deci-sion making in its EBM campaigns. For example, alerts can inform analysts of customer spending on products related to home improvement, health products, or infant care, which may create new purchase propensity leads. Alerts can notify analysts of high deposit withdrawals or large funds transfers to other financial institutions, which could signal customer defection. Alerts also provide notice of changes to a customer’s economic environment, such as a new investment horizon or a rebalancing of a wealth man-agement portfolio, which may provide additional sales opportunities.

> Customer channel contact management: Analysts can ensure that communications are executed using only the customer’s preferred channels. Team members have used the solution to remove duplicate customer names and change contact rules, without any help from

IT. “This feature has greatly enhanced the ability of the marketing organization to communicate at the right time and on the right channels with our customers,” says Fadzil.

After training and coaching in the use of the system, Maybank’s business channels are beginning to embrace the campaign management functionality. “The number of customers contacted by the branch employees has risen by more than 70%,” says Khair. “Now nearly 90% of branches actually request lead-generation support, up from only 50% a few years ago. Our branches recognize the value of the leads they are getting from the aCRM system.”

Reporting features keep branch workers engaged in cam-paigns, too. “The branches like getting information about their performance in terms of leads generated, customer contacts, and resulting sales,” he adds. “It helps them to translate their efforts into value to the bank, which is always rewarding.”

Event-Based Marketing

Maybank uses EBM to improve both the customer experi-ence and campaign ROI. Unlike traditional marketing, which is driven by a product approach, EBM campaigns are triggered by customer events. (See Figure 6.)

Figure 6. Moving from Traditional Marketing to Event-Based Marketing

Decide What Product

to Sell

Traditional Marketing

Event-Based Marketing

CampaignDesign to SellOne Product

Identify group ofcustomers who will

most likely need the product in the

whole customer base

Analyze Best Changein Customer

Behavior

CampaignDesign and

Execute to SellMultipleProducts

Identify customerswho qualify in the

“change condition” inthe last 1 or 2 days

EB-6274 > 1110 > PAGE 13 OF 17


Maybank’s aCRM system includes an event-based engine, which runs seven days a week, scanning significant cus-tomer transactions based on pre-defined business rules and priority. The output of this engine allows analysts to detect significant customer events.

Once the customer events are identified, Maybank’s CRM team uses the bank’s call centers, branch networks, and other channels to reach out to customers in a planned campaign. EBM also enables the predictive modeling of customers for product development and retention. With these capabilities, the bank can translate customer events into sales opportunities.

From the organizational perspective, EBM creates a structure for contacting customers and managing those contacts through the communication process (inquiry, infor-mation delivery, customer evaluation, product sale). Sales representatives can provide the highest possible service while increasing the chances of making a sale. Customers perceive that the bank sends them only useful information, contacts them by their preferred channels, and offers them relevant products.

With this structure, the marketing team can contact custom-ers when they are likely to be ready to make a decision. This approach not only improves success rates and cam-paign ROI, but it also optimizes the time spent on customer contact by branch and call center personnel. Before deploy-ing the aCRM system, conversion rates were less than 10% for the average campaign. “With the EBM functionality, some of our campaigns have experienced conversion rates of 30%,” says Hafiz.

Teradata Relationship Manager 6 helps Maybank’s CRM team use customer life-cycle events to shape marketing campaigns. “The EBM capabilities definitely make our jobs easier,” says Hafiz. “So far we are just doing simple EBM campaigns, but as we gain expertise we will begin

creating next-best offers and using the more sophisticated functionality.”

Best of all, the aCRM system is helping Maybank dif-ferentiate itself from the competition. “As one of the first companies in Malaysia with EBM capabilities, we can do more than our competitors,” says Hafiz. “When you call a customer and you already know which products they have, it makes the conversation more personal and more effective than using a generalized approach. That can only be an advantage to Maybank.”

Customer Segmentation

Maybank’s customer segmentation approach divides customers into target segments that can be used to optimize service and growth. The bank segments customers based on their total financial assets holding, which represents all housing, personal and unit trust loans, deposits, credit cards, insurance premiums, and unit trusts. Using this measure, Maybank groups its customers into three broad segments: high net worth, mass affluent, and mass.

The bank uses the aCRM system to meet the following customer segmentation goals:

> Grow and retain and mass affluent and high network market.

> Identify mass affluent customers from the mass customer market.

> Nurture relationships with high-worth customers to help them build their total fixed asset value.

“Wewerelookingforalong-termsolution,andweknewTeradatawasthebestchoicetomeetourneeds.”


EB-6274 > 1110 > PAGE 14 OF 17


Using customer segmentation capabilities of Teradata Relationship Manager 6, Maybank is building its customer knowledge and strengthening its relationships. “We’ve replaced our product-based approach with a dedicated staff assigned to each customer segment,” explains Hisham. “If our representative offers a product, it’s because we see a need. That helps us to increase customer satisfaction, which makes our relationship with each customer stronger.”

Data Mining and Business Intelligence

Analysts use Teradata Warehouse Miner to perform data mining and statistical analysis. The analytical component leverages a 360-degree view that helps Maybank analysts accurately identify revenue opportunities, enhance sales channels, mitigate cost risks, leverage valuable data, and optimize contact management with full automation.

Users can perform data mining entirely within the Teradata system. Supported activities include data

extraction (directly from the marketing data mart), data profiling, data manipulation, analytic data creation and model building, scoring, and evaluation to reporting. The modeling techniques include decision tree (such as regression tree and CHAID), association, clustering (e.g., K-Means), linear and logistic regression, and black-box (such as neural network). When used for product campaigns, bank analysts also use advanced data mining techniques that incorporate behavioral analytics.

Solutions Supporting Maybank acRM

Table 1.

Teradata Solution Role

Teradata Database Creates foundation for aCRM marketing data mart

Teradata SQL Assistant Enables analysis and reporting using Structured Query Language

Teradata Warehouse Miner Helps analysts perform data mining

Teradata Relationship Manager Supports campaign configuration and execution by marketing business users

Teradata Utilities Assists analysts with bulk load, scripting, and related tasks

Teradata Financial Services Logical Data Model

Provides ability to support large amounts of detailed data for long periods of time; provides the backbone for the decision support, analytical, and informational environment

Oracle Data Integrator (ODI) Supports data extraction, loading, and transformation process from source system to aCRM marketing data mart

Oracle Business Intelligence Enterprise Edition (OBIEE)

Being deployed as a business intelligence platform, with plans to integrate OBIEE into aCRM to support an upcoming credit risk initiative

“Whenyoucallacustomerandyoualreadyknowwhichproductstheyhave,itmakestheconversationmorepersonalandmoreeffectivethanusingageneralizedapproach.ThatcanonlybeanadvantagetoMaybank.”

EB-6274 > 1110 > PAGE 15 OF 17


Results and conclusionAfter three years of using its aCRM system, Maybank is clearly gaining critical value in the areas of revenues and customer satisfaction – and meeting the goals for its new customer-centric marketing approach. Benefits can be assessed in several ways.

> Campaign volume: Before the aCRM system was deployed, Maybank conducted 10 to 15 campaigns per year. In its first year of using aCRM, Maybank rolled out 662 highly targeted marketing campaigns. By the next year, the number had climbed to 1,600.

> Campaign time to market: The time needed to create a campaign shrunk from more than three weeks to less than five working days.

> Lead generation time: Relying on the IT department, the bank required an average of two to three weeks to generate leads. With the new system, lead generation requires less than one day. With the EBM capabilities,

the CRM team runs approximately eight lead-generation campaigns a day. No EBM campaigns were possible with the prior CRM system.

> Average conversion rate: With the legacy system, conversions ranged from 0.3% to 3%. The average conversion rate under the aCRM system is 8%. Conver-sion rates have been as high as 30%.

> Report generation (business and customer): Reports that once took more than two weeks to create are now produced in less than a day.

> Incremental sales: For financial year 2008-2009, May-bank used the aCRM system to generate RM 2.6 billion (USD 8.4 million) in new sales, which contributed approxi-mately 12% to the total new consumer banking business.

> New accounts: More than 287,000 new accounts have been opened, a 450% growth since the pilot. Maybank generated RM 31.2 million (USD 10.1 million) of new deposits and RM 39.3 million (USD 12.7 million) in new loans and credit lines.

> New assets: New mortgage and personal loan accounts increased by RM 1.5 billion (USD 485 million). Savings and investment assets grew by RM 248 million (USD 80.2 million).

> Total customer financial assets (TFA): Average TFA increased by RM 10,000 (USD 3,234) per customer, confirming the bank’s successful capture of the target affluent customer segment.

> ROI: The annualized ROI for the project from the pilot to October 2009 is 164%. The locked-income ROI (which represents the lifespan of the product profitability) equals 1,143%. Payback for the pilot was estimated to be 9.8 months, with payback for the second phase of the project calculated at 6.4 months.

The bank also gained valuable IT efficiencies, including:

> Reduced IT workload: With the increased efficiency and effectiveness of the campaign management process, marketing requires far less support from IT. In addition, the new aCRM system requires much less operational

Active users 48

Average engagement 260 sessions/week

User types

Power users 70%

Casual users 15%

IT support team and sales staff 15%

Source systems 63 files/tables

Mainframe/minicomputer 64%

Relational 20%

External data 16%

Volume of data 1.6 TB

data upload intervals

Daily 80%

Monthly 20%

Maybank acRM by the Numbers

EB-6274 > 1110 > PAGE 16 OF 17


capabilities/ Strategic Enablers

Technology and/or Innovative Effort Implemented

Business Process Improvements

The Right Data Environment Foundation

aCRM marketing data mart Single view of customer data across all stakeholders, which enabled:

> More coordinated management of customer relationship activities

> A clear single-view analysis of customer behavior for optimal understanding of customer behavior and needs

> Customer contact with the most optimal communication at the right time

The Right Application

Teradata Database, Teradata Customer Relationship Manage-ment, Teradata Warehouse Miner

The Right Business Improvement Processes

Campaign and marketing auto-mation and implementation of a centralized, closed-loop, multi-step campaign management system

> Re-engineered campaign process starts with an understand-ing of significant changes in behaviors and needs of the bank’s customers, followed by a proactive and well-timed customer contact strategy

> Channel response flows back into the aCRM marketing data mart for effective campaign and channel performance monitor-ing and refinement

> Successes for each campaign are measured, enhancing understanding the impacts of each campaign towards customer behavior in the 5 key areas of CRM (acquisition, cultivation, retention, loyalty, and profitability)

The Right Customer Experience Marketing Approach

Implementation of the EBM engine and data mining capabilities

EBM campaigns implemented to supplement current marketing capabilities and balance the organization’s strategy between product-push vs. customer-need basis

The Right People Enhancement of the Maybank CRM team with the structure comple-menting the aCRM initiatives, and partnership with Teradata business and technical consultants

> Successful implementation with knowledge and skills transfer to the Maybank team for best-practice operations

> Growth of right skills and resources within the CRM team to match the increasing capabilities of aCRM

The Right Organizational Stakeholders

CRM team as core stakeholders, with strong participation from front-end channels (e.g., telesales and branches) and product teams

Successful beginning of Maybank banking transformation, to better provide meaningful customer experiences that increase the total financial assets for each customer

Table 2.

critical Business Process Improvements

work by the database administrator. Escalations decreased from an average six per month to just one.

> Increased efficiency and accuracy of query manage-ment: Higher processing performance through table partitioning, faster batch loading processes, reduced DBA effort for optimization and system management all contribute to a more productive query environment.

> Enhanced user, data, and application management: By automating and optimizing growth activities, the

system reduces time needed for planning and execution, cost-effectively accommodates increased usage, and creates significant savings in set-up and reconcilia-tion efforts.

> Improved data maintenance and management: The aCRM system reduces DASD storage, despite provid-ing enhanced granularity of data. It also eliminates tasks associated with calculation and physical placement of data and decreases the number of associated DBA tasks.

EB-6274 > 1110 > PAGE 17 OF 17


Teradata, the Teradata logo, and Raising Intelligence are trademarks or registered trademarks of Teradata Corporation and/or its affiliates in the U.S or worldwide. Teradata continually improves products as new technologies and components become available. Teradata, therefore, reserves the right to change specifications without prior notice. All features, functions, and operations described herein may not be marketed in all parts of the world. Consult your Teradata representative or Teradata.com for more information.Copyright © 2010 by Teradata Corporation All Rights Reserved. Produced in U.S.A.

TERADATA .COM

Another benefit of the Maybank aCRM project is the ability to use technology solutions to modernize and streamline business processes. Table 2 shows the business process improvements and enabling technology that led to these dramatic results.

Conclusion

After three years, Maybank has learned many lessons about executing a successful CRM project. One of the most important success factors is executive sponsorship and consistent governance, which was realized through the aCRM Steering Committee. “Company leaders must have the foresight to commit to this kind of CRM journey,” says Fadzil. “When the organization has leadership that is prepared to go the distance, the company can fulfill its CRM vision, as Maybank has.”

Maybank took steps to encourage stakeholder involvement. In addition to regular status review meetings, Maybank executed a detailed roll-out plan for socialization, including in-depth training, prior to launch. All resources involved in the implementation process were provided with training, followed by on-the-job shadowing programs. To ensure that knowledge was both absorbed and applied, Maybank management used internal programs, such as train-the-trainer, to transfer knowledge from Teradata. To ensure competency of channel agents, Maybank created the Channel Readiness Team to educate, support, and drive the agents. Incentives and compensation were also pro-vided to channel agents for each product sold, with higher incentives for more complex or valuable products.

“Of course our success would not be possible without the guidance and expertise of those that have been there before,” adds Fadzil. “Teradata provided not only hardware and software. They also brought a team of experts with both business consulting and technical expertise at many successful implementations across the globe.”

Maybank has been widely recognized for its innovation and achievement. The bank won the Teradata Most Innova-tive Solutions award in 2007, the 2009 Financial Insights Innovation award for its efficient use of the aCRM system, the Gartner and 1to1 Media CRM Excellence Award in 2010, and the Asian Banker 2010 award for best CRM application projects.

Maybank executives expect to continue optimizing usage of the aCRM system and expanding the number of data sources and channels. In the near future, the bank will integrate internet banking data into the marketing data mart, which will enable the CRM team to track customer clicks throughout the site and take action on those behaviors. Phase 3 of the project will likely include multi-channel, multi-step market-ing efforts, as well as micro-customer segmentation, risk profiling, a customer loyalty program, value-based pricing, and differentiated services. With these enhancements, the bank expects to explore more opportunities to boost sales performance, customer satisfaction, and ROI.

Ultimately, Fadzil hopes Maybank’s marketing data mart becomes an Active Data Warehouse. “If a prospect goes to our internet page and clicks on mortgage information, we want information about that behavior or transaction to be sent immediately to a banker, who could contact the customer,” he says. “With an ADW, we’ll be able to respond to such customer behaviors in real time.”

Continuous improvement and innovation will help Maybank succeed in the hyper-competitive financial services market. The partnership with Teradata supports the bank as it strives to achieve its ambitious goals. “Other vendors come in, install software, and go on their way,” says Fadzil. “The Teradata experts take time to talk with us and find out how we are doing, and they help us learn how things can be improved. With the Teradata team, we have a real partnership that will support not just our growth, but our ongoing success.”

Documents

Maybank BWP 2