Ranking the Vendors of Customer Profitability Analytics

January 15, 2002

Abstract

New York, NY, USA January 15, 2002

 

Celent predicts financial institutions will spend US$840 million by 2004 on Customer Profitability Analytics (CPAs). Celent expects marketing professionals will be increasingly compelled to align their CRM strategies with customer profitability considerations.

In a new report, " ," Celent Communications examines the adoption of Customer Profitability Analytics in the North American financial industry and provides a ranking of leading vendors in this arena.

While North American financial institutions have recently made dramatic efforts to analyze their profitability at the customer level, many institutions still lag behind when it comes to use the metrics in an operational manner. So far, marketing departments have expressed little interest in dealing with metrics, which have typically been the financial department's bailiwick. Celent estimates that, of the CPAs in use at North American financial institutions, 98% are run in financial department, with only 40% of financial institutions passing the information to the marketing department. “Because of the need to align CRM strategies to profitability considerations, marketers will have to pay more attention to customer profitability data beyond typical marketing metrics such as cross-selling, customer acquisition cost, and attrition rate,” comments Gwenn Bézard, author of the report.

Among the forces driving the popularization of Customer Profitability Analytics, Celent identifies the shift from product to customer-centricity and one-to-one marketing, the quest for channel management, the need to better manage scarce resources in a recession context, and the war on customer attrition. “Customer profitability analytics will have an significant effect on the banking industry in the next decade, just as it has in the credit card industry in the 1990s,” adds Bézard.

The report ranks the solutions provided by 8 vendors, including CoreProfit, EarningsInsights, HNC Software, IPS-Sendero, Metavante, NCR Teradata, PeopleSoft and SunGard BancWare.

The Best Customer Profitability Analytics Software Providers

Rank Large Financial Institutions Midsize Financial Institutions Small Financial  Institutions
1 NCR Teradata  Value Analyzer NCR Teradata  Value Analyzer CoreProfit  Profitwise
2 PeopleSoft EPM  Profitability Insight CoreProfit  Profitwise HNC  Profitability Manager IPS-Sendero CPS
3 CoreProfit  Profitwise HNC  Profitability Manager SunGard BancWare Perspective
4 HNC  Profitability Manager SunGard BancWare Perspective EarningsInsights EMiS

A Table of Contents is available online.

of Celent Communication's research services can download the report electronically by clicking on the icon to the left.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

 

  New York, NY, USA  January 15, 2002 Return to report Abstract
EXECUTIVE SUMMARY 3
INTRODUCTION 5
INDUSTRY OVERVIEW 7
  Adoption Overview 7
  Which Sectors Adopt the Metrics? 9
  Data Roadblock 12
  How Institutions Use Profitability Data 14
  Payback 16
VENDOR PROFILES 19
  CoreProfit 20
  EarningsInsights (ADS) 22
  HNC Software 24
  IPS-Sendero (FISERV) 26
  Metavante 28
  NCR Teradata 30
  PeopleSoft 32
  SunGard BancWare 34
VENDOR COMPARISON 36
FUTURE TRENDS 41

 

        

 

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