The data within CRM systems were reported to be used for marketing applications
as follows:
targeted marketing, 80%;
segmentation, 65%;
keeping the right customers, 47.5%;
trend analysis, 45%;
increased loyalty, 42.5%;
customised offers, 32.5%;
increase share of customer, 27.5%.Despite these benefits, it should be noted that in 2000, it was reported that around
75% of CRM projects failed in terms of delivering a return on investment or completion
on time. This is not necessarily indicative of weaknesses in the CRM concept, rather it
indicates the difficulty of implementing a complex information system that requires
substantial changes to organisations’ processes and major impacts on the staff that con-
duct them. Such failure rates occur in many other information systems projects.
Read Mini Case Study 6.2 ‘Customer data management at Deutsche Bank’ for an
example of the practical realities of managing customer data in a large organisation.KEY CONCEPTS OF ELECTRONIC CUSTOMER RELATIONSHIP MANAGEMENT (E-CRM)Deutsche Bank is one of the largest financial institutions in Europe, with assets under management worth
100 billion euros (£60 billion). It operates in seven different countries under different names, although the
company is considering consolidating into a single brand operating as a pan-European bank.
In 1999 its chairman, Dr Walther, said the company had to improve its cost-to-revenue ratio to 70 per
cent from 90 per cent and add 10 million customers over the next four to eight years. That would be
achieved by increasing revenues through growing customer value by cross- and up-selling, reducing
costs through more targeted communications, and by getting more new customers based on meaningful
data analysis.
Central to this programme has been the introduction of an enterprise-wide database, analysis and
campaign management system called DataSmart. This has brought significant changes to its marketing
processes and effectiveness. Achieving this new IT infrastructure has been no mean feat – Deutsche Bank
has 73 million customers, of which 800,000 are on-line and 190,000 use its online brokerage service, it
has 19,300 employees, 1250 branches and 250 financial centres, plus three call centres supporting
Deutsche Bank 24, its telebanking service. It also has e-commerce alliances with Yahoo!, e-Bay and AOL.
‘DataSmart works on four levels – providing a technical infrastructure across the enterprise, consoli-
dating data, allowing effective data analyses and segmentations, and managing multi-channel marketing
campaigns’, says Jens Fruehling, head of the marketing database automation project, Deutsche Bank 24.
The new database runs on the largest Sun server in Europe with 20 processors, 10 Gb of RAM and 5 ter-
abytes of data storage. It is also mirrored. The software used comprises Oracle for the database, Prime
Response for campaign management, SAS for data mining, Cognos for OLAP reporting, plus a data
extraction, transformation, modelling and loading tool.
‘Before DataSmart, we had a problem of how to get data from our operating systems where it was
held in a variety of different ways and was designed only for use as transactional data. There are 400 mil-
lion data sets created every month. We had a data warehouse which was good, but was not right for
campaign management or data mining’, says Fruehling.Mini Case Study 6.2 Customer data management at Deutsche Bank