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Efma Sme Banking Conference

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Roxana_Hidan

The document discusses how banks can grow during an economic slump. It recommends conducting internal evaluations and market research to determine customers' needs. Key steps include segmenting customers, developing bundled product offerings tailored to different customer segments, redirecting marketing efforts, and ensuring infrastructure supports the strategies. The top takeaways are focusing on customer value and needs, achieving profitability, and strengthening the customer-bank relationship.

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How to grow during the slump? Vienna, 26 March 2009 Roxana Hid R Hidan Deputy Director - Product Management SME Banking in CEE, SEE, CIS Avem ?ncredere
Agenda A d ? ¡°Crisis¡± / ¡°Recesion¡± / ¡°Depresion¡±? ? Heights of crisis in Romania ? Challenges Ch ll ? Key steps ? Top takeaways T t k SME Banking in CEE, SEE, CIS Avem ?ncredere
What is ¡°crisis¡±/ ¡°recession¡±/ ¡°depression¡±? Crisis is ¡­ a. A crucial or decisive point or situation; a turning point. b. An b A unstable condition, as i political, social, or economic affairs, i t bl diti in liti l i l i ff i involving an l i impending abrupt or decisive change. (Source: The American Heritage? Dictionary of the English Language, Fourth Edition) Recession is ¡­ An extended decline in general business activity, typically two consecutive quarters of falling real gross national product. a g ea g oss at o a p oduct (Source: The American Heritage? Dictionary of the English Language, Fourth Edition) Depression is ¡­ p A period of drastic decline in a national or international economy, characterized by decreasing business activity, falling prices, and unemployment. (Source: The American Heritage? Dictionary of the English Language, Fourth Edition) SME Banking in CEE, SEE, CIS Avem ?ncredere
The effects of the global crisis on Romania¡¯s economy ¡­ ? 28 Oct 2008 - ¡°Bucharest Stock Exchange sinks to new record low, following worse crisis on the financial markets¡± ¨C NewsIn.ro ? 29 Oct 2008 ¨C ¡°Standard & Poor's has downgraded Romania's rating to BB+, with negative outlook¡± ¨C Financial Newspaper ? 22 Jan 2009 ¨C ¡°Leu¡¯s fall ¨C Romania¡¯s leu plunges to a new historical minimum of 4.3127 4 3127 per euro on regional trend ¨C euro,on trend¡± NewsIn.ro ? 12 Feb 2009 ¨C ¡°Romania could borrow more than EUR 8bn from the EC, IMF¡± ¨C NewsIn.ro ? 6 March 2009 ¨C ¡°Romania's unemployment rate rises to 5.3% i F b t i t 5 3% in February on crisis i i replicas¡± - NewsIn.ro SME Banking in CEE, SEE, CIS Avem ?ncredere
¡­ and the impact on the Romanian banking environment ¡­ ? 20 Oct 2008 ¨C ¡°Romania¡¯s central bank gives Lombard credit of 2bn lei to offset lack of money on the market¡± ¨C NewsIn.ro ? 23 Oct 2008 - ¡°Rates on the Romanian money market remain at 100%, but few transactions are closed¡± - NewsIn.ro ?02 Dec 2008 ¨C ¡°Romania's central lender ¡°Romania s grants credits worth lei 49bn to banks in October¡± ¨C NewsIn.ro ? 27 Jan 2009 ¨C ¡°Crediting brakes in December for the third month in a row, to an annual advance of 33.7%¡± ¨C NewsIn.ro ? 28 Jan 2009 ¨C ¡°Romania¡¯s central bank lends 2.5 times less money to banks in Dec. over Nov. last year¡± ¨C NewsIn.ro ? 28 Jan 2009 ¨C ¡°Romanians' overdue payments to credits rise 73% y/y in November 2008 to 1bn lei, central bank shows¡± ¨C NewsIn.ro SME Banking in CEE, SEE, CIS Avem ?ncredere
µþ³Ü³Ù¡­.. 6 ¡°When written in Chinese, the word "crisis" is composed of two characters - one represents danger, and the other represents opportunity.¡± p pp y John Fitzgerald Kennedy Σ™C SME Banking in CEE, SEE, CIS Avem ?ncredere
How to reach the objectives? Challenges Key steps Top takeaways p y SME Banking in CEE, SEE, CIS Avem ?ncredere
We have to face several challenges ¡­ How could a How could larger customer maximize the base be How could adjust commercial achieved? the product and efficiency? ffi i ? service portfolio? How could H ld How could customer improve Bank¡¯s management and value towards care be organized customers? more efficiently? How could ¡­ optimize the How could gain value of the client additional insight relationship? into clients¡¯ needs and preferences? SME Banking in CEE, SEE, CIS Avem ?ncredere
¡­to reach the expected results Increase Increase cross- customer¡¯s selling confidence Increase and loyalty profitability Increase customer Increase satisfaction brand b d awareness Increase competitive advantages d t SME Banking in CEE, SEE, CIS Avem ?ncredere
How to achieve the objectives? 10 Determine Internal Market Redirect Ensure target evaluation research Products marketing infrastructure customer SME Banking in CEE, SEE, CIS Avem ?ncredere
Internal Key steps y p evaluation examine existing customer database (score the customer using key criteria) use scoring methodology to rank and segment the customers Database Scoring Segmentation use the obtained data to establish key performance indicators and benchmark separate the micro and small business customers from other categories of clients evaluate current products asses the activities and responsibilities of the staff in-charge with this segments SME Banking in CEE, SEE, CIS Avem ?ncredere
Internal Market Key steps y p evaluation research establish the research objectives design the research using the interview methodology (qualitative research) conduct interviews with as many companies y p as possible from each segment analyze the data to determine the answers to the questions and to compare the difference in the answers between the different segments develop an action plan based on data SME Banking in CEE, SEE, CIS Avem ?ncredere
Researches told us what customers¡¯ need 13 MSE main financial needs are transactional services and pure lending Individuals Private MSE Corporate banking Cash management services Transactional services Investment products & services p Financial advisory Pure lending P l di Structured finance Source: OTP Internal Research SME Banking in CEE, SEE, CIS Avem ?ncredere
Determine Internal Market target Key steps evaluation analysis customer indentify customers and prospects with potential analyze segment profit dynamics: average number of products, likely balances, growth, cross-sell and up-sell potential determine which customers are spending more on the competitor's products than on own products it is easier and less expensive to sell additional services to existing customers, especially in economies were conditions are not as good as they were previously SME Banking in CEE, SEE, CIS Avem ?ncredere
Determine Internal Market target Products Key steps evaluation analysis customer bundling offers the possibility to link viable products together, to link ¡°need¡± with ¡°value¡± bundles maximize the chances and afterwards the benefits of being the ¡°house- bank¡± the packages can be done using different strategies such as: inter-product cross-sell, up-sell, inter-segment cross-sell the bundle should be tailored taking also into consideration the life stage of the business building multiple relationships with a customer makes it more difficult for the customer to leave SME Banking in CEE, SEE, CIS Avem ?ncredere
Determine Internal Market Redirect target Products evaluation analysis marketing Key steps y p customer multi-channels delivery is critical: every touch-point is an opportunity to cross-sell, to acquire, to service multi-channels are an optimal tool in reducing the cost of serving do not underestimate the importance of the dedicated RM; for most of the mature companies the relationship is ¡°the product¡± redirect customers to appropriate products taking into account the life stage of the business frame the small business owners and their employees as individual customers SME Banking in CEE, SEE, CIS Avem ?ncredere
Define Ensure Internal Market Products Redirect target infra- Key steps evaluation research customer marketing structure streamline the processes and operational systems build competencies and skills for the sales force develop and implement incentive schemes fully aligned with the cross-sell strategy design and implement certain marketing tools to create awareness and build utilization continues analysis and evaluation of the client needs and customer value tracking refine segmentation, products and update performance indicators in accordance with the feedback SME Banking in CEE, SEE, CIS Avem ?ncredere
Top takeaways p y Value Need Profit SME Banking in CEE, SEE, CIS Avem ?ncredere
Thank you for your attention! Contact details: Email: roxana.hidan@otpbank.ro Mobil: +40755.000.017 M bil +40755 000 017 SME Banking in CEE, SEE, CIS Avem ?ncredere

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Efma Sme Banking Conference

  • 1. How to grow during the slump? Vienna, 26 March 2009 Roxana Hid R Hidan Deputy Director - Product Management SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 2. Agenda A d ? ¡°Crisis¡± / ¡°Recesion¡± / ¡°Depresion¡±? ? Heights of crisis in Romania ? Challenges Ch ll ? Key steps ? Top takeaways T t k SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 3. What is ¡°crisis¡±/ ¡°recession¡±/ ¡°depression¡±? Crisis is ¡­ a. A crucial or decisive point or situation; a turning point. b. An b A unstable condition, as i political, social, or economic affairs, i t bl diti in liti l i l i ff i involving an l i impending abrupt or decisive change. (Source: The American Heritage? Dictionary of the English Language, Fourth Edition) Recession is ¡­ An extended decline in general business activity, typically two consecutive quarters of falling real gross national product. a g ea g oss at o a p oduct (Source: The American Heritage? Dictionary of the English Language, Fourth Edition) Depression is ¡­ p A period of drastic decline in a national or international economy, characterized by decreasing business activity, falling prices, and unemployment. (Source: The American Heritage? Dictionary of the English Language, Fourth Edition) SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 4. The effects of the global crisis on Romania¡¯s economy ¡­ ? 28 Oct 2008 - ¡°Bucharest Stock Exchange sinks to new record low, following worse crisis on the financial markets¡± ¨C NewsIn.ro ? 29 Oct 2008 ¨C ¡°Standard & Poor's has downgraded Romania's rating to BB+, with negative outlook¡± ¨C Financial Newspaper ? 22 Jan 2009 ¨C ¡°Leu¡¯s fall ¨C Romania¡¯s leu plunges to a new historical minimum of 4.3127 4 3127 per euro on regional trend ¨C euro,on trend¡± NewsIn.ro ? 12 Feb 2009 ¨C ¡°Romania could borrow more than EUR 8bn from the EC, IMF¡± ¨C NewsIn.ro ? 6 March 2009 ¨C ¡°Romania's unemployment rate rises to 5.3% i F b t i t 5 3% in February on crisis i i replicas¡± - NewsIn.ro SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 5. ¡­ and the impact on the Romanian banking environment ¡­ ? 20 Oct 2008 ¨C ¡°Romania¡¯s central bank gives Lombard credit of 2bn lei to offset lack of money on the market¡± ¨C NewsIn.ro ? 23 Oct 2008 - ¡°Rates on the Romanian money market remain at 100%, but few transactions are closed¡± - NewsIn.ro ?02 Dec 2008 ¨C ¡°Romania's central lender ¡°Romania s grants credits worth lei 49bn to banks in October¡± ¨C NewsIn.ro ? 27 Jan 2009 ¨C ¡°Crediting brakes in December for the third month in a row, to an annual advance of 33.7%¡± ¨C NewsIn.ro ? 28 Jan 2009 ¨C ¡°Romania¡¯s central bank lends 2.5 times less money to banks in Dec. over Nov. last year¡± ¨C NewsIn.ro ? 28 Jan 2009 ¨C ¡°Romanians' overdue payments to credits rise 73% y/y in November 2008 to 1bn lei, central bank shows¡± ¨C NewsIn.ro SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 6. µþ³Ü³Ù¡­.. 6 ¡°When written in Chinese, the word "crisis" is composed of two characters - one represents danger, and the other represents opportunity.¡± p pp y John Fitzgerald Kennedy Σ™C SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 7. How to reach the objectives? Challenges Key steps Top takeaways p y SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 8. We have to face several challenges ¡­ How could a How could larger customer maximize the base be How could adjust commercial achieved? the product and efficiency? ffi i ? service portfolio? How could H ld How could customer improve Bank¡¯s management and value towards care be organized customers? more efficiently? How could ¡­ optimize the How could gain value of the client additional insight relationship? into clients¡¯ needs and preferences? SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 9. ¡­to reach the expected results Increase Increase cross- customer¡¯s selling confidence Increase and loyalty profitability Increase customer Increase satisfaction brand b d awareness Increase competitive advantages d t SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 10. How to achieve the objectives? 10 Determine Internal Market Redirect Ensure target evaluation research Products marketing infrastructure customer SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 11. Internal Key steps y p evaluation examine existing customer database (score the customer using key criteria) use scoring methodology to rank and segment the customers Database Scoring Segmentation use the obtained data to establish key performance indicators and benchmark separate the micro and small business customers from other categories of clients evaluate current products asses the activities and responsibilities of the staff in-charge with this segments SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 12. Internal Market Key steps y p evaluation research establish the research objectives design the research using the interview methodology (qualitative research) conduct interviews with as many companies y p as possible from each segment analyze the data to determine the answers to the questions and to compare the difference in the answers between the different segments develop an action plan based on data SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 13. Researches told us what customers¡¯ need 13 MSE main financial needs are transactional services and pure lending Individuals Private MSE Corporate banking Cash management services Transactional services Investment products & services p Financial advisory Pure lending P l di Structured finance Source: OTP Internal Research SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 14. Determine Internal Market target Key steps evaluation analysis customer indentify customers and prospects with potential analyze segment profit dynamics: average number of products, likely balances, growth, cross-sell and up-sell potential determine which customers are spending more on the competitor's products than on own products it is easier and less expensive to sell additional services to existing customers, especially in economies were conditions are not as good as they were previously SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 15. Determine Internal Market target Products Key steps evaluation analysis customer bundling offers the possibility to link viable products together, to link ¡°need¡± with ¡°value¡± bundles maximize the chances and afterwards the benefits of being the ¡°house- bank¡± the packages can be done using different strategies such as: inter-product cross-sell, up-sell, inter-segment cross-sell the bundle should be tailored taking also into consideration the life stage of the business building multiple relationships with a customer makes it more difficult for the customer to leave SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 16. Determine Internal Market Redirect target Products evaluation analysis marketing Key steps y p customer multi-channels delivery is critical: every touch-point is an opportunity to cross-sell, to acquire, to service multi-channels are an optimal tool in reducing the cost of serving do not underestimate the importance of the dedicated RM; for most of the mature companies the relationship is ¡°the product¡± redirect customers to appropriate products taking into account the life stage of the business frame the small business owners and their employees as individual customers SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 17. Define Ensure Internal Market Products Redirect target infra- Key steps evaluation research customer marketing structure streamline the processes and operational systems build competencies and skills for the sales force develop and implement incentive schemes fully aligned with the cross-sell strategy design and implement certain marketing tools to create awareness and build utilization continues analysis and evaluation of the client needs and customer value tracking refine segmentation, products and update performance indicators in accordance with the feedback SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 18. Top takeaways p y Value Need Profit SME Banking in CEE, SEE, CIS Avem ?ncredere
  • 19. Thank you for your attention! Contact details: Email: roxana.hidan@otpbank.ro Mobil: +40755.000.017 M bil +40755 000 017 SME Banking in CEE, SEE, CIS Avem ?ncredere