Mumbai Mirror's 10th August edition has a cover page article that screamed about an ATM that eats up the customer's cash. On reading further, apparently someone had tinkered with the ATM machine such that it would debit a higher amount than what was actually withdrawn. In one of the cases mentioned, the customer withdrew Rs. 10,000 but was debited for Rs. 40,000. Another customer made a transaction of Rs. 50,000 but was debited for Rs. 200,000 thousand.
The article has generated a decent amount of comments on how ATMs are tinkered with.
In all this melee, there was something the bank, in this case Axis Bank, could have done. I am not going to lecture on how ATMs can be made more secured. That is not my area of expertise.
In a career spanning close to two decades, I have delivered multiple projects. As with every software project, the User Acceptance Test phase is the final stage wherein the end users test the software before signing it off for deployment. During every UAT, I always set some ground rules:
1. It is a system made by man and can definitely be broken by man.
2. If your objective is to break the system, you will definitely succeed and it is not a commendable thing to achieve.
I use the same rules for this scenario. The ATM has been designed by man and so can be broken by man. There is a manual process involved where access it permitted to a person and thus opens environment for tinkering.
In line with CRM, the question is what could the Bank have done?
In both cases mentioned, the customer was the one to complain to the bank. No doubt the bank would have refunded the money to the customer. But what about the customer who did not get the SMS message or did not check his account soon enough?
This is a perfect case for event or transaction based analysis. In both scenarios, withdrawal of such a large amount may not have been a regular transaction for the customer. In fact for the second case, withdrawal of Rs. 200,000 may have been a first.
The bank could have analysed the debits for each customer and been able to identify the unusual withdrawal by the customer. Based on past behaviour each customer may have a different threshold for identifying an unusual behaviour. The moment this unusal behaviour was identified, the bank should call the customer and confirm the withdrawal. When the customer denies the transaction, it would point to possible fraud. The bank would have various options now:
-- deactivate the debit card
-- noticing the ATM machine to be the same one, decommission it immediately so more customers do not face the trouble.
From a customer perpsective, the bank could have assured the customer that the transactions will be actively investigated and the amount credited back to the account if valid.
The benefit to the bank was that the customer would be comfortable thinking that the bank is looking into his case as well as the bank could have limited the customers exposed to the fraudulent ATM. And more important, imagine if the press article said -- that the bank identified the fraud and quickly protected more customers from facing the same by blocking the ATM. Now that article would be "priceless".
Thursday, August 11, 2011
Friday, August 05, 2011
Let HRD solve Marketing Issues.....
Recently I viewed the video of the presentation of Deborah Rhodes during her appearance at TED. During the speech she has quoted Malcolm Gladwell stating "The only time a physician and a physicist get together is when the physicist gets sick". She goes on to state that this occurence "makes no sense, because physicians have all kinds of problems that they don't realize have solutions. And physicists have all kinds of solutions for things that they don't realize have solutions." Before I continue with my post, I want anyone who has a woman to love in their life (and thats practically everyone) to view this talk by Deborah titled "A tool that finds 3x more breast tumors, and why it's not available to you."
What Malcolm Gladwell says is so very true. If you look around your office and see groups of people hudled in the conference rooms, there is a 9 out of 10 chance that they belong to the same department. They have probably got together to solve some problem or address some issue related to operations of the department.
Organizations define Key Performance Indicators and allocate them to various departments. So revenue is sales. Costing is finance. and so on.... Thereafter, these KPIs are the babies of each department and no body else is allowed to play with the baby or provide tips to the foster parents.
At one telco, there was a high amount of customer churn in the landline business after the first 3 months of activation. The role of keeping the customer active belonged to the "Retention Department." There was a whole lot of action happening in the retention department. I was called in to see if statistics could play a role. Having just two months of customer behaviour data did not excite he statistician in me. I decided to snoop around while I was at the premises of the company. I was also building CRM processes in line with eTOM for this telco. As part of this assignment, I was walking the process with the team responsible for installing the landline phones at the consumer site. One of this person stated that the sales person would ask the customer to just sign the acquisition form and would fill it up later in the office. While filling the form, the sales person would tick all options and services to be activated. When this person went for installation, the consumer would only be interested in knowing about voice calls since that was all he wanted. However, when the bills came in, the consumer saw an 'inflated' bill since he was also charged for services that he did not need. The installation person stated that he could not help the consumer since the installation process did not allow him to revalidate the consumer services and to deactivate the ones the consumer does not need.
This discussion connected the dots. The consumer saw a high amount on his bill for just 'voice telephony.' To him, the telco was overcharging him. Nobody explained to him the rentals charged for services that were activated for him because the sales person ticked the options in the application form. The consumer got upset over this payment and would request for disconnection in the second month. Before he could be disconnected, the telco required him to pay his outstanding till date. So a second bill was generated. This showed that majority of consumers churned in the third month.
If only, the retention department had involved every one who had a consumer touch point in trying to understand the problem at hand.
For that matter, the Human Resources and Finance departments may also have some solutions to the problems of say, the Marketing department.
What Malcolm Gladwell says is so very true. If you look around your office and see groups of people hudled in the conference rooms, there is a 9 out of 10 chance that they belong to the same department. They have probably got together to solve some problem or address some issue related to operations of the department.
Organizations define Key Performance Indicators and allocate them to various departments. So revenue is sales. Costing is finance. and so on.... Thereafter, these KPIs are the babies of each department and no body else is allowed to play with the baby or provide tips to the foster parents.
At one telco, there was a high amount of customer churn in the landline business after the first 3 months of activation. The role of keeping the customer active belonged to the "Retention Department." There was a whole lot of action happening in the retention department. I was called in to see if statistics could play a role. Having just two months of customer behaviour data did not excite he statistician in me. I decided to snoop around while I was at the premises of the company. I was also building CRM processes in line with eTOM for this telco. As part of this assignment, I was walking the process with the team responsible for installing the landline phones at the consumer site. One of this person stated that the sales person would ask the customer to just sign the acquisition form and would fill it up later in the office. While filling the form, the sales person would tick all options and services to be activated. When this person went for installation, the consumer would only be interested in knowing about voice calls since that was all he wanted. However, when the bills came in, the consumer saw an 'inflated' bill since he was also charged for services that he did not need. The installation person stated that he could not help the consumer since the installation process did not allow him to revalidate the consumer services and to deactivate the ones the consumer does not need.
This discussion connected the dots. The consumer saw a high amount on his bill for just 'voice telephony.' To him, the telco was overcharging him. Nobody explained to him the rentals charged for services that were activated for him because the sales person ticked the options in the application form. The consumer got upset over this payment and would request for disconnection in the second month. Before he could be disconnected, the telco required him to pay his outstanding till date. So a second bill was generated. This showed that majority of consumers churned in the third month.
If only, the retention department had involved every one who had a consumer touch point in trying to understand the problem at hand.
For that matter, the Human Resources and Finance departments may also have some solutions to the problems of say, the Marketing department.
Tuesday, July 19, 2011
Choice is Good... but too much of it is BAD
The TVC for a noodle brand shows a kid asking a series of questions to arrive at the fact that choice is good.
There have been a lot of arguments in favour of providing choices. It leads to personalization of offers. One can target greater population. A seller can provide more options. And finally, the customer feels empowered and in control of the buying process when he can select and decide the item to purchase from various options available.
I would advise the product managers and marketers to exercise caution when providing options. Let’s walk through the customers’ mental buying process. For sake of example, we will consider an item which is fast becoming a frequent purchase – a mobile handset.
When a customer has decided to purchase a new handset, there is a set of features and functionality that forms a checklist in his mind. He looks at various options available and shortlists those models that meet the mandatory and sufficient needs from this check list. Finally, he zeroes on one model and purchases the same.
What happens next is very interesting. Have you ever considered why you are dissatisfied after you buy a product?
When the customer has purchased the product, his universe of options now reduces to just two. The first option is the model he has recently purchased and the other option is a “collation” of all other models. So it is now a comparison between one model and the “best features” of all the remaining models that was originally being compared. When this evaluation plays in his mind, he obviously feels a doubt that his decision was not correct and he feels disappointed. Sometimes this process happens even while the purchase is being processed. Ever noticed that slight tinge of doubt on your decision and purchase while your credit card swipe is being authorized?
Most often this disappointment gets translated into dissatisfaction with the product purchased and eventually with the supplier or manufacturer.
It is very important that the choices be kept at an optimum. Cause the fact there is a choice of options forces the customer to take one more decision. Any step in the buying process delays the sale and every step is a potential drop from the purchase process. Thus choices can delay the sales closure since the customer now has to perform one extra evaluation and take an additional decision. Even when a customer does make a decision, the post purchase evaluation will result in dissatisfaction with his decision. The blame will ultimately rest on the supplier / manufacturer. Hence, I reiterate, keep the choices at an optimum. Let there be a real reason for the option to exist.
In case of the noodle, whenever I walk down the breakfast aisle, I take the easy way out. I pick up one of each flavor and dump it in the shopping cart. That’s one less decision for me.
And as for the mobile handset, I still get the tingle that maybe the E72 was not the right handset to buy…sigh!!! Especially when I use my wife’s phone … an E5 from the same manufacturer at 60% the cost…sigh! sigh!!. Ford was so right… any colour as long as it is black.
If you read this, do leave your feedback / comment.
There have been a lot of arguments in favour of providing choices. It leads to personalization of offers. One can target greater population. A seller can provide more options. And finally, the customer feels empowered and in control of the buying process when he can select and decide the item to purchase from various options available.
I would advise the product managers and marketers to exercise caution when providing options. Let’s walk through the customers’ mental buying process. For sake of example, we will consider an item which is fast becoming a frequent purchase – a mobile handset.
When a customer has decided to purchase a new handset, there is a set of features and functionality that forms a checklist in his mind. He looks at various options available and shortlists those models that meet the mandatory and sufficient needs from this check list. Finally, he zeroes on one model and purchases the same.
What happens next is very interesting. Have you ever considered why you are dissatisfied after you buy a product?
When the customer has purchased the product, his universe of options now reduces to just two. The first option is the model he has recently purchased and the other option is a “collation” of all other models. So it is now a comparison between one model and the “best features” of all the remaining models that was originally being compared. When this evaluation plays in his mind, he obviously feels a doubt that his decision was not correct and he feels disappointed. Sometimes this process happens even while the purchase is being processed. Ever noticed that slight tinge of doubt on your decision and purchase while your credit card swipe is being authorized?
Most often this disappointment gets translated into dissatisfaction with the product purchased and eventually with the supplier or manufacturer.
It is very important that the choices be kept at an optimum. Cause the fact there is a choice of options forces the customer to take one more decision. Any step in the buying process delays the sale and every step is a potential drop from the purchase process. Thus choices can delay the sales closure since the customer now has to perform one extra evaluation and take an additional decision. Even when a customer does make a decision, the post purchase evaluation will result in dissatisfaction with his decision. The blame will ultimately rest on the supplier / manufacturer. Hence, I reiterate, keep the choices at an optimum. Let there be a real reason for the option to exist.
In case of the noodle, whenever I walk down the breakfast aisle, I take the easy way out. I pick up one of each flavor and dump it in the shopping cart. That’s one less decision for me.
And as for the mobile handset, I still get the tingle that maybe the E72 was not the right handset to buy…sigh!!! Especially when I use my wife’s phone … an E5 from the same manufacturer at 60% the cost…sigh! sigh!!. Ford was so right… any colour as long as it is black.
If you read this, do leave your feedback / comment.
Thursday, July 07, 2011
Happy to be PETER
Finally I got to contributing to my blog again. My earlier company had stopped me from publishing in my personal blog and expected me to contribute to the official blog. For some reason this bought about the most dreadful thing to writers -- A writers Block. I just could not get to write any more ... any where. A change of job resulted in change of mindset and I am back in action here.
Today I write about online insurance. Recently I bought a term insurance online. One of the reasons, I went online was the very low premium. Initially I was sceptical about the low premium and thought maybe the claim process will not be good. But somehow I convinced myself to get a policy online.
The past few days I did some research on the online v/s offline policies being sold. Some insurers have similar policies being sold online as well as offline (via agents). But there is a huge difference in the premiums being charged. I thought it might be the savings on the agent commission and selling expenses. But then, that is high only in the first year, whereas the premium is a constant low throughout the policy term.
A lot of research and reading various articles by insurance experts and the following came about:
1. People buying online are educated guys.
2. Educated guys are more knowledgeable about health issues.
3. Guys buying online are likely to be in white collar jobs.
4. White collar job workers have lower mortality rates than the blue collar job workers.
So the expected claim ratio from online policies are much lesser and as such the insurers can charge much lower premiums.
Which means, when I bought the policies offline (via agents), I was clubbed with the general population and ended up paying a higher premium to offset the losses from the segments with higher mortality experience. This reminds me of my earlier article Robin Hood Pricing wherein I had highlight how good customers end up subsidizing the bad customers. Today, the insurer treats the online policy buyers as a separate market and does not club it with the rest of the population. The cost of serving the online policy customer is less and as such the premiums are lower.
Now as I hold my policy documents I feel happy to be Peter and happy that the insurer did not rob this Peter to pay some Paul.
Today I write about online insurance. Recently I bought a term insurance online. One of the reasons, I went online was the very low premium. Initially I was sceptical about the low premium and thought maybe the claim process will not be good. But somehow I convinced myself to get a policy online.
The past few days I did some research on the online v/s offline policies being sold. Some insurers have similar policies being sold online as well as offline (via agents). But there is a huge difference in the premiums being charged. I thought it might be the savings on the agent commission and selling expenses. But then, that is high only in the first year, whereas the premium is a constant low throughout the policy term.
A lot of research and reading various articles by insurance experts and the following came about:
1. People buying online are educated guys.
2. Educated guys are more knowledgeable about health issues.
3. Guys buying online are likely to be in white collar jobs.
4. White collar job workers have lower mortality rates than the blue collar job workers.
So the expected claim ratio from online policies are much lesser and as such the insurers can charge much lower premiums.
Which means, when I bought the policies offline (via agents), I was clubbed with the general population and ended up paying a higher premium to offset the losses from the segments with higher mortality experience. This reminds me of my earlier article Robin Hood Pricing wherein I had highlight how good customers end up subsidizing the bad customers. Today, the insurer treats the online policy buyers as a separate market and does not club it with the rest of the population. The cost of serving the online policy customer is less and as such the premiums are lower.
Now as I hold my policy documents I feel happy to be Peter and happy that the insurer did not rob this Peter to pay some Paul.
Sunday, January 23, 2011
One question too many....
After 4 years of using my Sony Ericsson M600i (yup..the one profiled in Casino Royale), I switched to a Nokia E72 last week. Reviews said this was the best business phone in the market today. I am not getting into a debate on that one.
While setting up the phone without referring to the user manual, I somehow managed to get my SIM blocked. This state is not new to me, since I had achieved the same state with my M600i. So I called up the Vodafone customer service number. After the initial queries, I was directed to the action menu of the IVR. I was surprised to hear that the "Know your PUK" option was the second option. So I choose it and get the IVR read out my PUK. I got my E72 running again. All within 2 minutes. Considering I had a harrowing time during my M600i days to get the PUK from the Agent of Vodafone. This was a very pleasant experience. When I hung up, I was very happy to get my E72 alive so I can proceed on my exploration of the features.
Within a few minutes, I get an SMS from Vodafone:
"Thank you for using Vodafone Interactive Voice Response(IVR) System.Was the required information for your query available on IVR?Reply toll free with YES or NO."
It was very appropriate time from them, and I replied a resounding "YES".
Then I get a second SMS,
"Thank you for your response.Was the IVR menu easy to use?Reply toll free with YES or NO."
Now this was the last straw. It got me pissed off. And I have still not responded to this. This was one question too many. Vodafone should have stopped at the first question. Maybe the next time I call them, they could have asked this. "One question at a time" is my motto that I preach to every CRM manager I meet.
While on this, let me highlight the "toll free" phrase in both messages. Vodafone has recently started charging for speaking to the call center agent. Bold move? I say stupid move. You can only do this, if your services are up to the mark and your service permits self service. The fact that they have to throw of customers from talking to the call center agents shows that customers do not find Vodafone services meeting their needs.
At this time, Idea comes out the "Get Idea" advert showing Abhishek telling a woman to get Idea when she has been held in waiting by the customer service number. Will it help them get the Vodafone customers...? This needs to be seen. But for someone who has recently been thru the Vodafone customer service and possibly suffered a charged interaction with the agent, this ad is bang on. A review of the advert series in this Sunday's daily by two advertising professionals gave poor rating to the Idea ad series. But as a consumer I disagree and think the advert series is bang on and probably much better that the "language" series Idea ran previously.
Yesterday I received a SMS from Nokia about a "strong BLACK theme" available for free download. When I go to the link, I am told that my phone does not support this theme. My registration with Nokia was for E72. They should have known that the theme is not supported by my phone and should have eliminated my number from the SMS list.
I have heard many marketers say "its only SMS and costs only 1 paise to send one out". But the cost of a wrong message is the possible option for "do not mail". To me the TCO of any database marketing should also include the cost of a customer opting for a "do not contact". Then this one SMS may seem like a cost of over a 100 rupees. Now let me hear you, Mr. Marketer..... speak louder...
While setting up the phone without referring to the user manual, I somehow managed to get my SIM blocked. This state is not new to me, since I had achieved the same state with my M600i. So I called up the Vodafone customer service number. After the initial queries, I was directed to the action menu of the IVR. I was surprised to hear that the "Know your PUK" option was the second option. So I choose it and get the IVR read out my PUK. I got my E72 running again. All within 2 minutes. Considering I had a harrowing time during my M600i days to get the PUK from the Agent of Vodafone. This was a very pleasant experience. When I hung up, I was very happy to get my E72 alive so I can proceed on my exploration of the features.
Within a few minutes, I get an SMS from Vodafone:
"Thank you for using Vodafone Interactive Voice Response(IVR) System.Was the required information for your query available on IVR?Reply toll free with YES or NO."
It was very appropriate time from them, and I replied a resounding "YES".
Then I get a second SMS,
"Thank you for your response.Was the IVR menu easy to use?Reply toll free with YES or NO."
Now this was the last straw. It got me pissed off. And I have still not responded to this. This was one question too many. Vodafone should have stopped at the first question. Maybe the next time I call them, they could have asked this. "One question at a time" is my motto that I preach to every CRM manager I meet.
While on this, let me highlight the "toll free" phrase in both messages. Vodafone has recently started charging for speaking to the call center agent. Bold move? I say stupid move. You can only do this, if your services are up to the mark and your service permits self service. The fact that they have to throw of customers from talking to the call center agents shows that customers do not find Vodafone services meeting their needs.
At this time, Idea comes out the "Get Idea" advert showing Abhishek telling a woman to get Idea when she has been held in waiting by the customer service number. Will it help them get the Vodafone customers...? This needs to be seen. But for someone who has recently been thru the Vodafone customer service and possibly suffered a charged interaction with the agent, this ad is bang on. A review of the advert series in this Sunday's daily by two advertising professionals gave poor rating to the Idea ad series. But as a consumer I disagree and think the advert series is bang on and probably much better that the "language" series Idea ran previously.
Yesterday I received a SMS from Nokia about a "strong BLACK theme" available for free download. When I go to the link, I am told that my phone does not support this theme. My registration with Nokia was for E72. They should have known that the theme is not supported by my phone and should have eliminated my number from the SMS list.
I have heard many marketers say "its only SMS and costs only 1 paise to send one out". But the cost of a wrong message is the possible option for "do not mail". To me the TCO of any database marketing should also include the cost of a customer opting for a "do not contact". Then this one SMS may seem like a cost of over a 100 rupees. Now let me hear you, Mr. Marketer..... speak louder...
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