How UK banks could benefit from CRM-enabled ATMs
UK banks are expected to begin integrating their CRM systems into the automated teller machine (ATM) channel, with the launch of NCR's new 'APTRA Relate' application in the UK. This follows successes in North American and Asian markets where offer take-up has been up to 30% higher through the ATM channel than through the more costly direct mail channel.
NCR's ATM relationship management software allows financial institutions to run CRM campaigns through the ATM channel while allowing consumers to personalise their ATM transactions, as well as getting important account information (such as when their car insurance is due for renewal).
Expected demand NCR expects leading UK banks to begin deploying the software within the next year as they continue to extend the function and customer service value of their ATM networks beyond mobile phone top-ups and instant cash and cheque deposits.
Banks in North America, the Netherlands and Asia have already deployed the system, using it to link their ATM networks to their central CRM databases, providing the ability to establish one-to-one communications through ATMs and to integrate them with other marketing channels.
According to NCR, communications via the ATM channel can also be managed at a much lower cost than direct mail. For example, one North American bank's personalised ATM communications cost around US$0.01 per message compared to US$0.60 by mail.
Increased uptake Some banks are using APTRA Relate to make personalised loan offers, with consumers having the option to initially accept the offer through the ATM. The bank then follows up with more information on the offer through another channel such as a call centre or the internet.
The North American banks reported a higher uptake through CRM-driven ATMs than through ordinary mailed communications, with acceptance levels for pre-approved credit card offers by two major banks being more than 30% higher than the same mailed offer.
Consumer view "Consumers see the ATM as an appropriate channel to receive brief financial information," said Fiona McDade, NCR's APTRA Relate product manager. "Offers and reminders flash up on the ATM while transactions are processed, making the whole process more convenient and appropriate, compared with contact by direct mail or outbound call centres."
The response mechanism at the ATM is instant, as customers simply press a button to reply. For example, if a customer requests a cash withdrawal that takes them over their overdraft limit, an overdraft extension can be offered and accepted in real-time.
Service and satisfaction But beyond the obvious benefits of targeted marketing, the system allows ATM transactions to be personalised. After entering their PIN, the customer can be greeted by name and offered their 'usual transaction' (such as withdrawing £20 and being issued with a printed advice slip) without needing to make those selections manually each time.
An new NOP survey published by NCR showed that 69% of people select the same services each time they use a cash machine. Personalising the ATM to give the usual service can cut the average transaction time by up to a third, helping to reduce queues at the ATM and increase customer satisfaction.
The system also allows customers to set reminders of important financial dates, such as when their home insurance is due for renewal. NOP found that 20% of UK consumers want to be reminded that their car insurance is due for renewal, and more than 20% would like birthday and anniversary reminders from the ATM.
"ATMs are the most frequent way that people interact with their bank, so it is no wonder that many financial institutions are looking at integrating communications with their other channels," added McDade. "UK banks are already introducing new ATM services such as mobile phone top-ups, and cash and cheque deposits. Given the level of interest from UK banks, we expect to see the first implementations of this new technology within the next year."
The technology NCR says that APTRA Relate is suitable for banks with any level of CRM capability, ranging from those with no CRM systems to those with sophisticated data warehouses. It comprises two core elements:
- Relate Client, which allows the consumer application to interact with the bank's CRM system or personalisation engine (such as Teradata, Siebel or BroadVision). This element of the system uses web service technology to provide communication between the ATM and the bank's CRM server. It exchanges information about the profile of a customer, obtains content (such as product offers) and responds to customers interactively.
- Relate Manager, which provides a rules engine and database for banks that do not already have an existing CRM solution. This element of the system has a Windows desktop application for defining content and presenting it. It comes pre-configured with common functions such as greeting customers by name and offering them their usual transaction. It also carries a set of example campaigns (such as event-based marketing) which can be adapted by the bank. It can operate as a stand-alone system or it can interact with a bank's existing data mart or customer information system.
The software supplements NCR's range of systems for ATMs running on the Microsoft Windows platform. Until now OS/2-based legacy systems have largely prevented CRM applications running on the ATM but most UK banks are now migrating their ATM networks to an open platform and are in a better position to implement applications such as CRM on ATMs.