Introduction

CRM is an acronym for ‘Customer Relationship Management’. It’s a set of strategies, processes,

Metrics, organizational culture and technology solutions that enhance an organization's ability to

see the differences in its present & prospective customers, track new opportunities to better serve

customers and act, instantly and profitably, on those differences and opportunities. Recently

CRM has taken a center stage in the business world with businesses concentrating on saving

money and increasing profits by redefining internal processes and procedures. It costs a

company dramatically less to retain and grow an existing client, than it does to court new ones.

The aim of CRM is to optimize the use of technology and human resources.

CRM services consist of the following major segments:

Consulting services

Implementation services

CRM Outsourcing services

Training services

The idea of CRM is that it helps businesses use technology and human resources gain insight

into the behavior of customers and the value of those customers.

If it works as hoped, a business can: provide better customer service, make call centers more

efficient, cross sell products more effectively, help sales staff close deals faster, simplify

marketing and sales processes, discover new customers, and increase customer revenues. the

organization must look into all of the different ways information about customers comes into a

business, where and how this data is stored and how it is currently used.

ICICI Bank (BSE: 532174, NYSE: IBN) (formerly Industrial Credit and Investment

Corporation of India) is a major banking and financial services organization in India. It is the 4th

largest bank in India and the largest private sector bank in India by market capitalization. The

bank also has a network of 1,700+ branches (as on 31 March 2010) and about 4,721 ATMs in

India and presence in 19 countries, as well as some 24 million customers (at the end of July

2007). ICICI Bank offers a wide range of banking products and financial services to corporate

and retail customers through a variety of delivery channels and specialization subsidiaries and

affiliates in the areas of investment banking, life and non-life insurance, venture capital and asset

management. (These data are dynamic.) ICICI Bank is also the largest issuer of credit cards in

India. ICICI Bank's shares are listed on the stock exchanges at Kolkata and Vadodara, Mumbai

and the National Stock Exchange of India Limited; its ADRs trade on the New York Stock

Exchange (NYSE).

The Bank is expanding in overseas markets and has the largest international balance sheet

among Indian banks. ICICI Bank now has wholly-owned subsidiaries, branches and

representatives offices in 19 countries, including an offshore unit in Mumbai. This includes

wholly owned subsidiaries in Canada, Russia and the UK (the subsidiary through which the Hi

SAVE savings brand is operated), offshore banking units in Bahrain and Singapore, an advisory

branch in Dubai, branches in Belgium, Hong Kong and Sri Lanka, and representative offices in

Bangladesh, China, Malaysia, Indonesia, South Africa, Thailand, the United Arab Emirates and

USA. Overseas, the Bank is targeting the NRI (Non-Resident Indian) population in particular.

ICICI reported a 1.15% rise in net profit to Rs. 1,014.21 crore on a 1.29% increase in total

income to Rs. 9,712.31 crore in Q2 September 2008 over Q2 September 2007. The bank's

CASA ratio increased to 30% in 2008 from 25% in 2007. ICICI Bank is one of the Big Four

Banks of India, along with State Bank of India, Axis Bank and HDFC Bank its main

competitors.

In 1955, The Industrial Credit and Investment Corporation of India Limited (ICICI) was

incorporated at the initiative of World Bank, the Government of India and representatives of

Indian industry, with the objective of creating a development financial institution for providing

medium-term and long-term project financing to Indian businesses. In 1994, ICICI established

Banking Corporation as a banking subsidiary.

CRM INITIATIVES IN ICICI BANK

The CRM initiatives in India's ICICI Bank hold together its compelling story of growth. Its

growth in customer base, channels, and product and service offerings. Since its inception in

1995, the bank has grown to have 15.8 million customers, holding about 17 million accounts.

The bank's network has expanded to 610 branches and standalone counters and over 2,000

ATMs.

CRM has been envisioned by the bank to support its goals in sales, customer service, and

analytics. Already, about 30.40% of the bank's home loans are cross-sold to existing customers.

Similar ratios have also been reported in the sale of insurance policies. Ratios of about 50.60%

have been seen out of the credit cards and personal loans business. The bank's stated intention is

to take these ratios to as high as 60.75%. ICICI Bank states that these high levels of relationship

maximization are made possible by how its CRM system is able to "know and understand the

customer better.´ which customer is most suitable for what kind of product and at what point in

time."

In the area of service, the bank receives as many as 150,000 customer requests per day, a

challenge not only to channel capacity but also to how the bank is able to ensure that each

request is recorded, tracked, and resolved. Last, customer analytics have been used to support

various strategic decisions of the bank. Recent strategic decisions of note are several anti-

attrition programs, the intended attrition of unprofitable customers, the imposition of fees, and

various customer segment tactical initiatives.

ICICI Bank's CRM capability is built on a Teradata´ data warehouse that integrates data from

multiple sources, including the Oracle database and various flat files. The system provides users

with information about each customer's checking accounts, fixed deposits, credit cards, and other

financial information. The bank has taken on the end-to-end proposition of SAS for enterprise

intelligence, which offers a credible integrated approach to analytics, including data detection,

data cleansing, data preparation, event detection, reporting and business intelligence, and

campaign analysis. The bank estimates that it is able to track more than 1,200 parameters

concerning demographics, transactions made, channel usage, and product relationships. Through

Behavior Explorer and views, business users develop customer profiles and run ad hoc queries.

Analysts then use the information to guide product development and marketing campaigns that

are intended to address each individual's total requirements, instead of just pushing a product.

The success of cross-selling to existing customers has also been enabled by the bank's growing

capabilities in lead management. The home loans business unit, for example, has built a lead

management system rolled out to about 700 users. The system is able to allocate leads, schedule

meetings, provide a record of all interactions with the customer, and give reminders for customer

follow-ups. A lead generation tool has also been developed in-house to capture and route Product

applications made over mobile phones.

The Following report isthe analysis of Customer Relationship Management (CRM) in ICICI

Bank, India.

Customer Relationship Management (CRM) is a business strategy for improving profitability

by focusing on customer needs and creating an attentive relationship with the customer.

It involves a personalized and interactive approach for the entire customer lifecycle. Successful

implementation of a CRM approach requires changes in organization structure, culture, and

skills, as well as front- and back-office information systems.

Aim of Customer Relationship Management is to produce Customer Equity in Banking

Sector. The following are the three major drivers of customer equity that are considered for our

analysis:

1. Value Equity.

2. Brand Equity.

3. Relationship Equity.

The competitive competency of any bank would be achieving all the above three benefits so as to

be a successful and most desirable bank in the future of its prospects.

1. Value Equity: This measures the customer perception about benefits relative to its cost. The

sub drivers of value equity are quality, price and convenience.

2. Brand Equity: Customer's subjective and intangible assessment of the brand beyond the

objectively perceived value. The sub drivers are customer brand awareness, customer attitude

towards the brand, customer perception of brand ethics

3. Relationship Equity: Customers tendency to stick to the brand above and beyond the

objective and subjective assessment of its worth .Sub drivers of relationship equity includes

loyalty programs, community building programs and knowledge building program.

The ICICI Bank is the first bank to appoint the post of

Relationship Officer in its every branch around India so

as to enable an effective gapless customer interaction

between the bank and the customer. This designation

carries the customer complaints and critiques faced by

the customers towards their transactions with the Bank

like deposits, loans, account maintenance, withdrawals,

cheque books etc. This enabled a fearless and non-

hesitative relationship between both ends.

ICICI bank has more brand equity with its customers in India holding awards shown above and

also its more number of Branches equaling SBI, the largest network branches in India. This more

proximity has made ICICI more established in the minds of the customers that this bank has

more reliable values and services.

"Winning this award is an incredible achievement for ICICI Bank and Teradata," says Teradata

business manager (India) Amrish Rau. "The solution was the first large-scale CRM

implementation in the Indian banking sector. Teradata commends ICICI Bank for its vision and

willingness to take on such a monumental project. This shows how an Indian company

embracing enterprise data warehousing solutions can very quickly rise to stand alongside the

very best businesses in the world. ICICI Bank has set a precedent that others can follow."

ICICI Bank

(www.icicibank.com)

has won the DM

Review World Class

Solution Award 2003

in the Business

Intelligence category

for its Teradata

Data Base Management an essential feature of CRM is well established by ICICI Bank with its

customers. This bank was awarded as the world solution provider in Data warehousing.

CRM- THE ICICI EXPERIENCE

CRM at ICICI involves increased communication between the virtual universal bank and its

customers and the prospects as well as within the group itself. The underlying idea is to enhance

every instance of contact with the customer. ICICI

believes that a true customer relationship can only be

accomplished by considering the unique prospective

of every single customers.

The CRM strategy of ICICI proves to be One to One

marketing so that every prospect is taken care of in

their own way this flexibility is the main reason for

the company’s overall success in Relationship

marketing. The reliability the main key factor in

Banking sector as ot deals with the money of the

customer the bank should show 100% reliability with

the customers and in that way ICICI knew that better

Relationship marketing would bring in more closer

and reliable relationship with the public as which it

would attract more account holders with the bank.

The award-winning Teradata enterprise data warehouse (EDW) solution has enabled ICICI Bank

to establish business intelligence market leadership in the fast-growing Indian financial market.

The bank uses its Teradata platform to develop tailored marketing campaigns that have boosted

customer acquisition rates significantly. It has serviced over 11 million unique customers around

the country. In addition, ICICI Bank's credit cards and retail loans business units attribute 25 and

20 per cent respectively of their new/incremental business in the past year to cross-selling

activities facilitated by the data warehouse.

The key to implementing CRM was in understanding organization and customers in a better way.

There are five interrelated areas that were taken care of before implementing CRM:

Emphasizing on the importance of

CRM one of the ICICI employees

said, “With the overall improvement

in the ETL1 process made possible

by PowerCenter, we benefited from

greater data immediacy for business

users and more reliable information,

which resulted in quicker analysis

and timely reporting.”

—Gurnam Saini, Assistant

General Manager, ICICI Bank

Business Focus

Organizational Structure

Business Metrics

Marketing Focus and Technology

Business Focus: There are various components of CRM like customer information, sales,

marketing trends and marketing efficacy that acted in tandem to improve relationship between

ICICI and its consumers. ICICI captured customer data and analyzed them while dealing with

customers at these very touch points. A CRM solution from Siebel was implemented for the

automation of customer handling in all key retail products of the Group. The solution allows

customer service agents to track all customer complaints and requests. It also allows target

setting and centralized tracking of turnaround times for request fulfillment. The solution went

live in phases during fiscal 2002. The Bank has also undertaken a retail data warehouse initiative

to achieve customer integration at the back-office. This central view of the total customer

relationship is being used extensively for identifying opportunities to cross-sell new products and

services to the existing customer base.

Technology Focus: ICICI Bank continues to leverage ICT2 as a strategic tool for its business

operations to gain competitive advantage. Its technology strategy emphasizes enhanced level of7

customer services through 24x7 availability, multi-channel banking and straight through

processing, and cost efficiency through optimal use of electronic channels, wider and focused

market reach and opportunities for cross-selling. The Technology Management Group (TMG) is

the focal point for the ICICI Group’s technology strategy and Group-wide technology

initiatives.This group reports directly to the Managing Director & CEO.A key to ICICI’s success

has been its ability to harness business information to CRM initiatives that have fueled growth

and helped attract more than 30 million customers. The foundation for ICICI Bank’s wide-

ranging CRM programs is a Sybase IQ-based data warehouse. Developers had used a

combination of PL/SQL and BTEQ scripting, a proprietary technology specific to the data

warehouse, for data extraction, transformation, and loading (ETL). With its growing customer

base, IT administrators recognized that the bank needed a more powerful, sophisticated data

integration system to help ensure the warehouse lived up to its potential as an analytic CRM

engine that delivered tangible bottom-line results.

To step up to the next level of data integration, ICICI Bank officials agreed with a

recommendation from Teradata’s professional services division, which provided systems

integration support for the data warehouse, to implement the Informatica PowerCenter enterprise

data integration platform. (The Bank initially used Teradata as its data warehouse platform and

migrated to Sybase IQ a year ago.) ICICI Bank deployed PowerCenter in 2003 as it embarked on

the next phase of its warehouse, which would add data from five new sources, in addition to the

initial three sources of retail banking, credit cards, and securities information.

The next step in the CRM implementation process was gap analysis which essentially is

assessing different loopholes in:

- Marketing, sales and service practices

- Collection, capture, processing and deployment of customer information

- Distribution and operations effectiveness at customer touch points

The CRM software applications facilitate multiple

business functions with the customers of this bank.

As known ICICI systems are well designed so as to

equal quality with its one to one marketing strategy

and that is it was awarded in DM review world class

solutions.

These Success milestones talk more about the concentric and concrete functions of ICICI in

CRM strategies. The chronic strategies of ICICI right from its inception and till now have shown

the company’s importance towards its customer centric strategies and organizations. The

customer life cycle tracking system in ICICI is the only kind of software used in the Banking

sector in India. This unique software used by the ICICI helps them to provide faster solution to

the customers whenever they needed like Dormant accounts, expired accounts, unlimited

banking statements etc.

ICICI Bank was awarded the Most

Customer Responsive Company at

‘The Economic Times - Avaya

Global Connect Customer

Responsiveness Awards 2007′. In

the Insurance category, the

winner was ICICI Prudential Life

Insurance

CRM includes many aspects which relate directly to one another

Front office operations : Direct interaction with customers,

(e.g. face to face meetings, phone calls, e-mail, online services etc.)

Back office operations: Operations that ultimately affect the activities of the front office.

(e.g. billing, maintenance, planning, marketing, advertising, finance, manufacturing, etc.)

Business relationships: Interaction with other companies and partners, such as

suppliers/vendors and retail outlets/distributors, industry networks (lobbying groups,

trade associations). This external network supports front and back office activities.

Analysis: Key CRM data can be analyzed in order to plan target-marketing campaigns,

conceive business strategies, and judge the success of CRM activities (e.g., market share,

number and types of customers, revenue, profitability).

The marketing campaign: Process and the Software support

DATA MINING AND DATA WAREHOUSING: THE PROCESS OF RELATIONAL MARKETING:

The Relational Marketing process is supported by a computing infrastructure where many software packages are integrated with the bank's information system. The same is true for the ICICI Bank.

CRM BUSINESS CYCLE IN ICICI

1. Understand and Differentiate.

2. Develop and customize

3. Interact and Deliver

4. Acquire and retain.

Understand and differentiate: Understanding customers is important in order to

develop a sound relationship with them. Customer profiling is done in order to

understand demographics, purchase pattern and channel preference. CRM also helped

ICICI in valuation of its customers to understand customer profitability and Customer

Life Time Value (CLV).

Develop and customize: - In a customer centric business environment, the products and

processes have to be according to customers’ needs and preferences. ICICI has always

focused on developing channels of service delivery according to customers’ need and

service expectation.

Interact and Deliver: To foster a strong customer relationship ICICI ensured that all

areas of the bank have easy access to relevant, actionable customer information and

employees should be trained on how to use customer information to tailor interactions

based on both customer needs and potential customer value.

Acquire and Retain: CRM helped ICICI to figure out valuable customers and made it

easy to formulate retention strategies for them. It also helped it cope up with the change

in customer’s life cycle and offer services accordingly.

The basic model of implementing CRM is what followed by ICICI also. The post of

Relationship officer proved that the ICICI has felt that the bank needs a person interacting with

the customer and to the organization. ICICI started understanding the customer needs from the

relationship officers in every bank and started listening to the basic benefits that the customers

are expecting from the bank. Understanding the basic benefits ICICI way was extended to

provide extra ordinary services like Express counters, 24 hrs account enquiry, Express bank

statements, faster loans etc.

Customization of these specifications is really tougher in case of banking sector since India is

the country where more than 1Billion people live and more diversified regions and languages.

Appointing local executives in respective regions was one of the smart thinking for ICICI so that

those local executives as Relationship Managers carry out respective region customers’ problems

more easily.

Customer retention is for what all these CRM companies are fighting for. This bank has a

wide customer networking system where the every account holder would pull on in any other

scheme of the same ICICI bank. For eg ICICI account holder would have both Current and

Savings account or Loan borrower or in any growth plans of the bank, this would stick the

customer with the bank at high rate. Thus ICICI has a strong customer feeling with their

organization and with their every scheme.

INTERVIEW WITH AN EMPLOYEE

Vicky: Good evening Ms. Priyanka Devedas.

Ms. Priyanka: Good evening Vicky.

Vicky: Is it the right time to talk? We need your help regarding CRM Processes at ICICI.

Ms. Priyanka: Sure Vicky, Tell me how can I help you?

Vicky: Can you just brief us regarding CRM process of ICICI bank?

Ms. Priyanka: CRM at ICICI is an extensive process which involves communication with existing customers and prospective customers. There are multiple channels through which we communicate with customers to carry out customer management process. We use different softwares to carry out these process.

Vicky: We have also heard that ICICI Bank is the number one bank in India in customer relationship management. What is ICICI doing different than other banks?

Ms. Priyanka: We use latest software to understand our customers, their demographics and needs. We try to provide them customized products as per their requirements. You must be aware of different credit card schemes provided by us to customers.

Vicky: CRM is the activity done at various levels of the organization, how does ICICI implement it?

Ms. Priyanka: Implementation part is done by Top management and I am not aware of the whole process. I can just tell you that “GAP analysis” is done before we embark on CRM implementation.

Vicky: Thank you very much Ms Devedas.

Ms. Priyanka: You’re welcome Vicky. Feel free to contact if you need further assistance. Have a nice day.

Reference:

Ms. Priyanka Devedas (Wealth Manager-Delhi)

Priyanka.devadas@icicibank.com

ICICI Bank Limited

Booth No. 104-105

Faridabad – 121007

Mobile-09953001002

The ease with which we could approach to this employee itself speaks volumes about the ICICI culture and its customer centric approach.

BENCHMARKS AND RESULTS:

In the first table, we can see that the benchmarks set by ICICI are definitely of world class

and clearly values customer’s precious time. Similarly, in the second table it’s evident that ICICI

Bank and HDFC Bank have done very well compared to other banks in terms of CRM best

practices. Moreover, the standard deviation is also very less compared to most of the other banks.

Clearly this has helped ICICI bank acquire a large customer base (about 30 million) in a

shortspan of time.

LIVE EXAMPLE

In 2008 economy slowdown many companies revenue fell down double the rate. Among that

economy has also eaten up the image of ICICI Bank. That time ICICI faced three major

problems:

1. 12% Account withdrawals from total holdings.

2. 24% decline in half yearly profit Jan-June.

3. HDFC’s CEO Deepak Parekh.

K.L. Kamath the CEO of ICICI Bank that time addressed to the press about the current

situation saying that ICICI has a strong customer network that assures zero account withdrawals

in coming future. The statement also proved to happen, Kamath made it happen with the strong

customer base that ICICI had before. The bank sent a prospective letter to every active customer

about the reduced risk for their money in the bank and also every branch of the Bank in India

promoted risk minimization campaign ads inside the branches and on some roads of the

respective cities and towns. No matter whether ICICI knew or do not knew that strong customer

base would save their food but that customer marketing really worked to retain the whole market

share of the ICICI Bank.

Thus ICICI has a strong customer feeling with their organization and with their every scheme

proving it that the ICICI have a successful CRM Implementation and high Maintenance at high

success rate.

CONCLUSION:

Thus, we see that a focused and customer centric approach helped ICICI Bank become # 2 bank

in India (till recently, as PNB has taken over it as the No 2 bank in India now). ICICI has used

CRM not only as a tool but also as a strategy to gain competitive advantage over other new

generation private banks. It has invested a lot in ICT and spared no pains in giving best to the

customers. Its multi-pronged approach towards managing customer relationship is paying

dividends constantly and as a result we see millions of happy satisfied customers determined to

make it one of the most successful banks in India.