Creating Customer Value

ICICI Bank

Table of Contents

S.No Topic

1 Introduction

i. ICICI Bank

ii. Customer Relationship Management (CRM)

2 Components of CRM at ICICI

3 Tools for delivering CRM

4 Clustering

4 ICICI Products and Services

5 Challenges faced by ICICI and Suggestions

6 Ways to improve customer services in Banks

7 References

INTRODUCTION

ICICI Bank

ICICI Bank (formerly Industrial Credit and Investment Corporation of India) is India's largest

private sector bank having a network of 3,529 branches and 11,063 ATMs in India, and has a

presence in 19 countries, including India. ICICI Bank offers a wide range of banking products and

financial services to corporate and retail customers through a variety of delivery channels and

through its specialized subsidiaries in the areas of investment banking, life and non-life insurance,

venture capital and asset management. ICICI Bank was originally promoted in 1994 by ICICI

Limited, an Indian financial institution, and was its wholly owned subsidiary. ICICI was formed in

1955 at the initiative of the World Bank, the Government of India and representatives of Indian

industry. In 1999, ICICI Bank becomes the first Indian company and the first bank or financial

institution from non-Japan Asia to be listed on the NYSE. ICICI Bank is the only Indian brand to

figure in the Brand Top 100 Most Valuable Global Brands Report 2011, second year in a row. ICICI

Bank ranked 5th in the list of "57 Indian Companies", and 288th in World Rankings in Forbes

Global2000 list.

Customer Relationship Management

Customer Relationship Management has become inevitable for growth and profitability of Banks

in present scenario marked by rising competition, technological advancement and empowered

customers. The CRM practices are adopted to generate better understanding of the customer for

product development, segmentation, appropriate targeting, campaign management and

maintenance of long term profitable and mutually beneficial relationships with customers.

CRM is the strategy for building, managing and strengthening loyal and long-lasting customer

relationships. CRM is a customer centric approach based on customer insight. Its ultimate

objective is towards ‘Personalised’ handling of customers as distinct entities through the

identification and understanding of their differentiated needs, preferences and behaviours.

Customer Relationship Management is the integration of two cornerstones of Indian banking viz.

technology and relationship marketing. It has a potential to bring about dynamic changes in

marketing practices of banks in near future, with the objective of business growth through

managing customers as assets, systematically collecting, analysing and disseminating customer

information and use of this customer information for acquiring, retaining and better servicing

customers.

Components of CRM at ICICI

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. The ICICI bank is one of the private

sector bank which is providing the customer value added services. They are not only able to

satisfy the customer but they are successful in building a never-ending relationship with the

customer. They are able to retain them and carry business with them to benefit both the

organization and the customer. Customer preferences and needs are very well understood by

this bank. With the help of technology they are able to develop brand equity in the market and

differentiate themselves from the competitors.

• Understand and

Differentiate

• Develop and Customize

• Acquire and Retain

• Interact and Deliver

1.Direct Marketing

2. 12 hrs banking

Opti-Q queue

management system

VIP Customers -Card based

swipes

1. Dedicated wealth

Manager

2.Priority services

Tools and Processes for delivering CRM at ICICI

1. Customer application form

2. Centralized software where the whole data is collected.

3. Wide range of offering

4. Cross – selling and

5. Feedback forms

Customer application forms

Bank collects all the data from customer application form and gets the personalized information

to know which product to offer to which customer. This process helps in collecting the data and

knowing what the customer wants.

Centralized software where the whole data is collected

The data collected through customer application forms is available at one server and can be

accessed anytime, anywhere. So, this helps in the further process of customized offerings and

cross –selling.

Wide range of offering

After collecting the data from the customer, team decides what product to offer to which

customer. In case the bank recognizes you as a valuable customer then is offers a more

customized service.

Feedback forms

The bank distributes feedback forms at all its branches. The customer feedbacks on the service,

technology used, employee behavior and promptness in solving customer’s problems, are taken

and they are analyzed.

Cross - Selling

It refers to offering another product from the service offering of the bank to the customer which

he has not gone for. For example If customer has savings account with the bank then they offer

him a insurance, fixed deposits etc. This depends on the value of the customer to the bank. Cross

selling is not offered to every customer. It depends on how loyal the customer is to the bank. The

more business he gives us, the more are his chances of being special services offered.

Catalyzing Cross- Selling at ICICI

CLUSTERING

ICICI Bank is an example of industrial cluster-based client segmentation. By effectively dividing

its customers according to industry and business linkages, ICICI is able to customize its service

approach towards specific cluster needs. In the IT sector for instance, ICICI is known to take equity

stakes in start-ups, while to support exporters, it finances pre-shipment orders with no collateral.

Within this segmentation strategy ICICI recognizes a wide range of client needs and

offers more than strictly financial solutions. ICICI Bank developed a “beyond lending” approach

to serving SMEs. By offering SME clients within specific industrial clusters a wide range of services

such as checking accounts, transaction, banking services, cash management services, trade

services, ICICI Bank has been able to increase its total SME client base to nearly 1 million

enterprises, only 5 percent of which are lending clients.

ICICI BANK PRODUCT BUNDLING BASED ON SME SECTORS

ICICI PRODUCTS AND SERVICES

ICICI Bank offers wide variety of Deposit Products to suit customer’s requirements, coupled with

convenience of networked branches/ ATMs and facility of E-channels like Internet and Mobile

Banking, ICICI Bank brings banking at doorstep.

iWish

iWish is a fun and flexible way of saving online to fulfill customer’s wishes. It is a flexible Recurring

Deposit that lets one save for his goals as and when one has the funds and earn better interest

rates just like a Fixed Deposit.

eLocker

ICICIdirect.com's eLocker helps one with the convenience and flexibility to store and retrieve his

important documents when he needs them. One can store scanned copies of Passport, PAN,

Agreements or even medical reports securely under his ICICI direct account.

eLocker helps eliminate need to carry copies of important documents either as a physical photo

copy or in storage devices like Compact Disks, USB token etc.

iMobile

iMobile is a breakthrough innovation in banking where practically all internet banking

transactions can be simply done on mobiles phones. Customers can transfer funds to ICICI and

Non ICICI Bank accounts just with the click of their mobile. The application covers Savings bank,

Demat, Credit Card and Loan accounts. Customers can also pay their utility bills and insurance

premium through this facility. ICICI Bank offers this facility free of charge to customers.

SAVING ACCOUNTS

ICICI Bank offers a power packed Savings Account with a host of convenient features and banking

channels to transact through. So now customers can bank at convenience, without the stress of

waiting in queues

SENIOR CITIZEN SERVICES

ICICI understand that as one reach the age to retire, one do have certain concerns whether his

hard earned money is safe and secure, whether his investments give him the kind of returns that

he needs. That's why ICICI has an ideal Banking Service for those who are 60 years and above.

The Senior Citizen Services from ICICI Bank has several advantages that are tailored to bring more

convenience and enjoyment in life.

YOUNG STARS

It's really important to help children learn the value of finances and money management at an

early age. Banking is a serious business, but ICICI make banking a pleasure and at the same time

children learn how to manage their personal finances.

FIXED DEPOSITS

Safety, Flexibility, Liquidity and Returns! A combination of unbeatable features of the Fixed

Deposit from ICICI Bank.

RECURRING DEPOSITS

When expenses are high, one may not have adequate funds to make big investments. But simply

going ahead without saving for the future is not an option. Through ICICI Bank Recurring Deposit

one can invest small amounts of money every month that ends up with a large saving on maturity.

So one can enjoy twin advantages- affordability and higher earnings

HOME LOAN

The No. 1 Home Loans Provider in the country, ICICI Bank Home Loans offers some unbeatable

benefits to its customers - Doorstep Service, Simplified Documentation and Guidance throughout

the Process.

PERSONAL LOANS

ICICI Bank Personal Loans are easy to get and absolutely hassle free. With minimum

documentation one can secure a loan for an amount up to Rs. 15 lakhs

CAR LOAN

The no 1 financier for car loans in the country. Network of more than 1500 channel partners in

over 780 locations. Tie-ups with all leading automobile manufacturers to ensure the best deals.

Flexible schemes & quick processing. Hassle-free application process on the click of a mouse.

FARM EQUIPMENT LOANS

Flexible repayment options in tandem with the farmer's seasonal liquidity. Monthly, Quarterly

and Half-yearly repayment patterns to choose from. Comfortable repayment tenures from 1 year

to 9 year

CREDIT CARDS

ICICI Bank Credit Cards give you the facility of cash, convenience and a range of benefits,

anywhere in the world. These benefits range from life time free cards, Insurance benefits, global

emergency, assistance service, discounts, utility payments, travel discounts and much more.

DEBIT CARDS

The ICICI Bank Debit Card is a revolutionary form of cash that allows customers to access their

bank account around the clock, around the world. The ICICI Bank Debit Card can be used for

shopping at more than 100,000 merchants in India and 13 million merchants worldwide.

TRAVEL CARD

Traveling with US Dollar, Euro, Pound Sterling or Swiss Francs; Looking for security and

convenience; take ICICI Bank Travel Card. Issued in duplicate. Offers the Pin based security. Has

the convenience of usage of Credit or Debit card.

PRE PAID CARDS

ICICI Bank brings a complete bouquet of pre-paid cards providing payment solutions at fingertips.

ICICI Bank pre-paid cards are a safe & convenient way for associate payments, disbursements,

gifting & small ticket transactions. Pre-paid cards are available on a VISA platform thus providing

accessibility to over one lakh merchant establishments & cash withdrawal from all VISA ATMs in

India.

Mutual Funds

Mutual Funds pool money of various investors to purchase a wide variety of securities while

pursuing a specific goal. Selection of Securities for the purpose is done by specialists from the

field. Returns generated are distributed to the Investors. Mutual Fund Companies offer various

schemes. Investors can choose any particular Fund/Scheme or mix of Funds/Schemes depending

upon their perception towards risk. Investment is done on the basis of prevailing Net Asset Values

of various schemes. Mutual Funds Investments are subject to Market Risks.

ICICI Bank Pure Gold

ICICI Bank with its `Pure Gold' offer attempts to bridge the gap between the need of the

customers for buying gold and availability of an organized avenue to satisfy that need, by taking

care of the two key components ­ Reliability and Convenience. Reliability 24 Carat ICICI Bank Pure

Gold is imported from Switzerland. This Gold carries a 99.99% Assay Certification, signifying

highest level of purity, as per international standards.

CHALLENGES FACED BY ICICI

And

SUGGESTIONS

1. Poor customer services

2. Higher service charges

3. Primarily targets middle class and upper class of society

4. Lower Retention of Experienced Staff and Potential customers

5. Less professional and inefficient customer-care people

6. Inhuman debt recovery methods

7. No proper facility for uneducated customers – mostly online

1. POOR CUSTOMER SERVICES

ICICI bank is degrading/limiting their online features when other banks are expanding the

same. Earlier they used to provide home loan account statement and payment schedule

online but from Sept 01, 2013 they have stopped doing the same and has made the

process cumbersome for the customers by forcing them to approach asset serving

branches, that are very few in numbers. Frauds regarding the gift vouchers were another

case where ICICI was considered shameless. Another case of travel card, where a

customer was informed in the booklet and customer care executive that it can be

accessed in any VISA ATM but it’s not like that. Only the ICICI bank ATM is accepting the

Card., It now became difficult to find that bank ATM when required. Even ICICI Customer

Care @ 33667777 was another issue where the call is either disconnected or placed on

hold for a very long time or transferred to main menu. The customer has to go through

the IVR Process again and again to get the request or an issue sorted.

SUGGESTION:

ICICI bank must look into the services it is providing to the customer. Especially in case

of travel cards, customer care service, interest rate of premium customers. If the poor

service of ICICI Bank continues, even loyal customers of this organization will shift to

other better banks.

2. HIGHER SERVICE CHARGES

Average monthly balance

Bank Rural Semi urban Urban Metro

SBI 500 500 500 1000

Union Bank of India 250 500 1000 1000

ICICI Bank 5000 5000 10000 10000

Other savings bank account related charges

Bank Stop Payments Acc Clos <6

Months

Acc Clos

Wc<1

Year

Acc clos Woc<1

year

SBI 50 100 100 100

Union Bank of India 89.89 113.48 113.48 76.4

ICICI Bank 50 500 500 500

ATM and DEBIT card charge

Bank ATM

Annual

ATM

Renewal

ATM

Replacement

Debit

Card

SBI 50 50 100 50

Union Bank of India 112.36 0 112.36 112.36

ICICI Bank 99 99 200 99

SUGGESTION:

Due to comparative higher service charges of ICICI bank with respect to other banks, its

customers are restricted to affluent class and middle class people. They can come up with

various cheaper schemes for the rural people so that they can enroll the rural people as

their customers and build a steady relation with them over the years and then later on

the bank can cross sell or upsell their products to these rural customers. And even the

existing customers aren’t happy with the exorbitant service charges because they feel

that the customer services aren’t upto mark. So ICICI bank should think on reducing the

service charges while maintaining the profits at sustainable rate.

3. INHUMAN DEBT RECOVERY METHODS

The debt recovery methods of ICICI bank are very stringent. If a customer defaults on his

installments only once, they pester him or her with constant reminders through text

messages, emails etc which annoys them. A case had happened last year that appeared

on the front page of Times Of India which stated that a person had taken a loan of

Rs.1,00,000 from ICICI bank. He defaulted just once and the officials of ICICI bank sent

bouncers at his place to recover the loan. The person filed a suit against the bank for the

mental trauma he suffered. The court ordered the judgment in favour of the person ICICI

bank had to give a compensation of 50 lakhs to that person. Such cases have happened

several times.

SUGGESTION

ICICI Bank should lay some proper rules for recovery methods and that should be applied

in all the branches of ICICI bank. Because if the customers get annoyed over this issue

then there may be instances that they would stop doing business with the bank. In this

way the bank may lose out on many customers. The bank should give some extended

period to the defaulters and carry out proper investigations as to why they are defaulting

before resorting to stringent measures.

4. Complaint regarding discrepancy in cash withdrawal from ICICI bank ATM

There were various issues regarding the withdrawal of cash from ICICI ATM, which

includes the improper working of ATM machine, insufficient cash available in the

machine. Apart from that complaints regarding the same by the customer, was not taken

into account rather asked to follow a stringent procedure of visiting the authority, writing

a mail regarding the same and wait for the solution. There are also power backup

problems associated with the ATMs and theirlocations.

SUGGESTION:

As most of the customers of ICICI bank use ATMs for withdrawal of money,the bank

should give minimum possible chance of complaints to the customers.

Complaint analysis 2013 shows the following major areas of concern:

WAYS TO IMPROVE CUSTOMER SERVICE IN BANKS

1. Under promise and over deliver

Keep customers happy by under promising and over delivering. For example, if a customer

applies for a credit card that normally takes some days (say 10 days) to deliver, you might

quote 15 -days delivery, but tell the customer that you will contact them if the credit card

arrives sooner. This is far better than the all too common practice of exceeding the original

deadline or estimate that most customers find annoying and unacceptable.

2. Keep customers informed

Make sure that staff keep customers informed if promises can't be met. For example, if some

mishap has delayed an order, ring up the customer as soon as you know of this. Try to

compensate in some way for the lateness. Think of something exceptional that will delight

the customer. If there is a small cost involved, weigh this against the customer's lifetime value.

The most important way to know if the customer is satisfied or not,

is to take feedback in various ways

3. Encourage staff to be thoughtful

Ask your staff to perform at least one act of kindness a day, such as opening the door for a

customer, or offering water to the customers waiting in the que. Being prepared to 'walk the

extra mile' can pay real dividends.

4. Do the unexpected

Give unexpected gifts or rewards to customers. For example, categorize the customers as

premium customers and regular customers. Send a bouquet to the premium customers on

their birthdays and email birthday wish to the regular customers expressing gratitude saying

thank you for doing business with us. These 'out of the blue' rewards can have a powerful

impact on building customer loyalty and goodwill.

5. Thank-you letter

Send a thank-you letter within two days of the customer doing business from you. If at all

possible, send a note the next day. It only has to be a hand written note on a standard card.

Other variations include sending a cartoon with your caricature to say thank you, or even a

cartoon card (depending on the customer and how much they have done business with you).

6. Send out a newsletter

Try to keep in contact with customers at least once every 90 days. Send a regular newsletter

(either by conventional post or email) to your customers. Add value to the newsletter by

including tips that will help them improve their businesses or their lives, as well as ideas

relating to your industry. You can also direct them to free reports they can download off your

website. This will encourage them to visit your website again and be exposed to the new

products or specials it might feature.

REFERENCES

Bibliography

1. Marketing Management: A South Asian Perspective;

By Philip Kotler, Kevin Lane Keller, Mithileshwar Jha Abraham Koshy

2. Customer Relationship Management: Emerging Concepts, Tools, and Applications;

By Atul Parvatiyar, G. Shainesh

Webliography

1. www.icicibank.com

2. www.citibank.co.jp/en/voc/flow

3. www.searchbusinessintelligence.techtarget.in

4. www.icicibank.com/aboutus/pdf/2013_05_Q4_FY2013_Investor_presentation.pdf

5. http://smefinanceforum.org/post/customer-management-in-sme-banking-guide