This document discusses the disruption of traditional retail banking by non-traditional banking options. It notes billions lost in revenue, challenges to brand loyalty, and rapidly changing customer expectations and technologies. It states that established tech companies and fintech startups are entering financial services with new offerings that appeal to diverse groups like millennials. Peer-to-peer lending platforms are allowing customers to bypass retail banks for loans. The document advocates that banks improve understanding of individual customers, accelerate digital transformation, and deliver improved mobile banking experiences to meet changing customer needs.

1. Driving Change in
Banking - Engagement
in the world of
empowered individuals
IBM Commerce for Bank CMOs
Marketing POV, May 2015

2. Retail banking is actively being disrupted by non-traditional banking:
Billions in revenue gone
Challenge to brand loyalty
Ever-changing regulations
Rapidly changing technology
Evolving security imperatives
Trust issues after financial
crisis
Social imperatives
“Nobody needs banks but everyone needs banking.”
- Heather Cox, Chief Client Experience, Digital and Marketing Officer for Global Consumer Banking @ Citi
DisruptiveForces
of Millennials “more excited
about a new offering in financial
services from Google, Amazon,
Apple, PayPal or Square than
from their own nationwide bank,”
Source: Viacom’s Millennial Disruption Index
Established tech companies such
as Apple, Amazon, and Square are
entering financial services with mobile
technology, new lending processes,
and improved security practices.
Fintech start ups in emerging and
developed markets cater to diverse
customers (millennials, unbanked,
underbanked) with new low-cost
tech such as mobile payments and
services that replace branches.
Peer-to-Peer lending and
Crowdsourcing platforms such as Sofi,
Common Bond, Lending Club, and
Kickstarter are allowing customers to
bypass retail banks for loans.
Sources: (1) Viacom Report (2) Blue Point Solutions Banking Disruption (3) American Banker (4) Investopedia (5) Economist: Article on
P2P (6) Bank Tech (7) Business Insider ($4.7tr stat)
trillion in revenue for traditional
financial services at risk of
being displaced by new tech-
enabled entrants.
Source: Business Insider
billion, in 2013 loans raised by
NA’s two largest P2P lenders,
Lending Club and Prosper, up from
$871m in 2012.
Source: Economist
73%
$4.7
$2.4
Millennial customers

3. 2
72% of CEOs are
making major
changes to
understand their
customers’ individual
needs
35% of the general
population is
influenced by social
media, vs. 52% of
Gen Y (Millennials)
The Smartphone is the
omni-present channel
for sharing and 91%
keep the phone close
and access it up to
150 X a day
What’s changing in the world of Banking client engagement

4. Source: IBM Institute for Business Value CEO Study; and the CMO study
CXO’s realize they must improve their understanding of individual customers and respond faster to their needs
Change is required to meet customer expectations
Improve understanding of individual customer needs
Improve response time to market needs
Harmonize customer experiences across channels
Include customers across product / service life cycle
Increase transparency and corporate accountability
Increase social and environmental responsibility
72%
68%
67%
44%
55%
38%
The most prominent challenges for Chief Marketing Officers
Data explosion1
Social media2
Growth of channels and devices3
Shifting consumer demographics4
71%
68
%
65%
63%

5. Bank marketing’s universe is changing too… Marketing must
re-imagine its role…
Know your customer as an individual
Create value at every touch
Be an authentic brand and culture
and Marketing must accelerate the transformation to Digital banking

6. But it is awfully hard to re-imagine marketing when the technology
infrastructure looks like this…
SMS
Marketing
Files
Files
Files
Files
Files Customer
Database
Files
Email Service
Provider Web Analytics
Provider
Website Behavioral
Targeting
Search Marketing
Dashboard
Customer Insight
ToolPredictive Analytics
Marketing Finance
Mgmt
Digital Asset Mgmt
Call Center/Inbound
Decisioning
Marketing
Operations Mgmt
Lead Management
Local Marketing
Predictive Analytics

7. Driving these challenges for bank marketers
Getting the right analytics to
inform interactions in real time is
difficult.
I can’t react to my
customers in real time.
I need my applications
to talk to each other.
I can’t access a single view of
customer data across channels.
It is too hard to offer relevant
offers and content to my
customers.
“ ” “ ”
”
”
”
“
“
“

8. IBM Commerce strategic vision for bank marketing:
Solutions for Banking to make it easier to design meaningful customer
experiences across applications, devices and time, and channels, accelerating
today’s results and tomorrow’s ambitions
Digital
Marketing
Customer
Analytics
Lead
Management
Real Time
Personalization
Omni Channel
Marketing

9. How Banking CMO’s Leverage IBM’s Marketing Solutions
 Sophisticated event detect that outperforms all other methods
of lead identification
 Comprehensive cross-channel lead management
 End-to-end customer lifecycle optimization - attract,
on-board, monitor and act on behavioral profiles
 Designing Cross-channel, multi-wave, outbound and inbound marketing
customer journeys

10. A IBM Commerce approach helps CMOs improve the customer
experience at the bank
9
Grow your knowledge
of customers as
individuals so you can
better target offers
and information.
Deliver an omni-
channel marketing
experience to give the
customer one
consistent brand
experience
Better anticipate
customer needs to
deliver more relevant
and timely offers that
are personalized and
more likely to be
accepted.
CMO Agenda
GAIN CUSTOMER
INSIGHT TO ACT
PERSONALIZE
INTERACTIONS
AND ENGAGE
CUSTOMERS WITH
RELEVANT
OFFERS
DELIVER AN
OMNI-CHANNEL
MARKETING
EXPERIENCE
DELIVER A
BETTER MOBILE
BANKING
EXPERIENCE
Deliver an improved
mobile banking
customer experience.
And ensure that mobile
is not a stand-alone silo,
with Omni-Channel
marketing.

11. Customer Experience Analytics
“I want to understand the what, why,
and how of my customers’
behaviors.”
Behavioral
Analytics
Journey
Analytics
Digital
Analytics

12. Dollar Bank
Drives customer satisfaction by truly understanding their customer journey’s across channels -- all
powered by IBM Customer Analytics solutions.
25S
Reduction in
average contact
call center times 30%
Fewer call escalations,
increasing customer
satisfaction
11 © 2015 IBM

13. The Value of the IBM Commerce Approach
Precise Efficient Proactive
Individually identify clients,
actions, and outcomes for
targeted and unique offers
Predict likelihood of
success, and focus on the
most impactful actions
Base your market strategy
and actions on future
outcomes, not just past
events
sophisticated analytics provide actionable insight to the customer engagement

14. OCBC Bank
273% 45%
Increase in
campaigns
deployed
Increased
conversion
rates 138%
Growth in
hidden
revenues
13 © 2015 IBM
Increases cross-sell rates resulting in engaged customers across all channels by understanding their
customer’s behavior -- all powered by IBM Marketing solutions.

15. Real-Time Personalization
“I want to dynamically serve up
relevant content, offers and
recommendations.”
Digital
Recommendations
Real-Time
Interaction Management
Opportunity
Detection

16. Capabilities that enable you to take full advantage
of every interaction
Maximize all types of real-time
engagement across channels
Use response data to refine and
optimize future decisions—
automatically
Directly engage in offer design
and creation
Enabled through:
Outbound offer personalization
Inbound offer personalization
Content and product personalization
Omni-channel campaign management and execution, including
mobile customer engagement

17. ING Bank
17 3x
Week reduction in
campaign cycle times
Increase in
customer responses 35%
Reduction in overall
marketing costs
16 © 2015 IBM
Transforms their marketing effectiveness through a focus on personalization -- all powered by IBM
Marketing solutions.

18. Omni-Channel Marketing
“I want to acquire and grow
customer relationships
online and offline; digitally and
in branches.”
Campaign Mgt Contact Optimization

19. Ignite and Grow Customer Relationships drives cross-channel engagement by:
Promoting
organizational alignment
Helps reduce channel
silos through collaboration
and measurement
Delivering brand consistency
Drives consistent
messaging across offline and online
channels
Creating an integrated, customer
journey
Aligns with customers’
expectations on their
channel of preference
at the right moment
Enabling solutions
• Campaign
• Contact Optimization
• Interact
• Interact Opportunity Detection
• eMessage
• Distributed Marketing
• Mobile Customer Engagement
• Marketing Operations

20. 19 © 2015 IBM
Banorte
Makes it personal across all channels to drive loyalty – with IBM Global Services and all powered by
IBM Marketing and IBM Customer Analytics Solutions.
40% 20%
Improvement in
operating
efficiencies
Return on
equity 200M
USD expected bottom
line benefit in the first
24 months

21. © 2015 IBM Corporation 20
DELIVER A BETTER
MOBILE BANKING
EXPERIENCE

22. 21
Unfortunately, most
bank apps rate 3 out
of 5 stars, and 50%
see no
differentiation…
… 60% rate mobile as
their reason to switch
banks…
…and 45% have
considered
deleting their
banks app…
Although most banks have mobile apps, customers are not wowed by
them:

23. … Banks have been treating mobile banking as just another channel –
aimed at reducing cost and increasing self service
Most online and mobile
capability is basic
► Mobile remote deposit
capture offered by a
minority
► Personalization rare
► Personal financial
management even rarer

24. Data
RichSecure
Continuously
Improve
Contextualize
and Personalize
Platform
services to
enable your
apps
Apps that
Are hard
because
Mobile speed and scale
requires new integration
and database approaches
for app developers
Outside the network’s
protection, mobile apps
and data require specific
governance
They require constant
user feedback,
monitoring and
release of revisions
Mobile apps must
capture, interpret and
act on disparate
context sources in real
time
Capabilities needed to succeed
To make good apps great through mobile platform services
IBM MobileFirst Platform delivers rich services and then integrates them for
an end-to-end experience for mobile development and operations teams

25. First Tennessee Bank uses web analytics to optimize mobile banking interactions by
driving targeted content
Business challenge: First Tennessee Bank wanted to make the most of the time customers spent on its web
and mobile sites by delivering personalized content and targeted marketing messages. The bank also wanted
to tap in to the data captured during virtual interactions to help tellers and call center employees improve
customer service and identify more up-selling opportunities.
The smarter solution: The bank implemented a web analytics solution that draws insight from customers’
online behaviors. It uses the data to create targeted content, email messages and product suggestions. The
solution also provides bank employees with insightful information about the customers they serve.
“Our goal is to make it easier for customers to do business with us on every channel. Today, we have all the
tools we need to deliver outstanding service across every device.”
—Nicole West, web analytics manager
3% lower
home page bounce rate as a result of
better insight into the page’s design
Increased frequency
of detailed web traffic reports from
monthly to weekly
13% faster
logins due to a better understanding of
what customers experience on the bank's
home page

26. 65%
Of the most influential CMOs
use IBM solutions4
15 of the 15top
Global Banking firms
use Commerce
solutions2
Nearly
15X ROI
For every dollar spent
on IBM Commerce1
#1 Banking
tech vendor as ranked
by the FinTech 1003
$100 billion
Commerce transactions
analyzed in Holiday
Benchmark Reports
5 years
in a row the Gartner Magic
Quadrant leader for Multi-
Channel Campaign
Management
IBM Commerce for banking delivers value at speed
25
Sources: Internet Retailer Top 500, IBM and Nucleus Research Provided for illustrative purposes and is not intended to be a guarantee of future growth rates or market opportunity.
2 Global Fortune 500 and top banks on the list 3 FinTech 100 ranking for partner vendors for the banking industry; 4Appinions Research conducted for Forbes

27. 26 © 2015 IBM
Why choose IBM Commerce?
THOUGHTFUL,PREDICTIVE,COGNITIVE
Design & Analytics
Integration
COLLABORATIVEANDSECURE
PROVENPARTNERFORSUCCESS
Industry Expertise

28. Notices and Disclaimers
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