As global wealth flows shift, reshaping your strategy now has become essential.

1. GROWTH IN CHALLENGING TIMES:
MAXIMISING CUSTOMER VALUE IN
WEALTH MANAGEMENT

2. SEYMOUR SLOAN
IDEAS THAT MATTER
THE WEALTH
MANAGEMENT MARKET
2

3. SEYMOUR SLOAN
IDEAS THAT MATTER
Profitable growth is on the agenda of most financial services providers, with
Wealth Management the focus of increasing competition
3CONFIDENTIAL
► Since the 2008 economic crisis, the richest 10% have recovered significantly faster than the rest of the economy. This has
increased the concentration of wealth into even fewer hands.
► In building a platform for growth, the large Wealth Managers are focused on acquiring and servicing a smaller number of
customers that hold an increasing share of the wealth.
► Those less able to compete focus on larger numbers of wealthy/affluent customers and varying their service model to optimise
returns.
► The market is in a state of transition as providers seek to define their strategy and approach to the markets.
► There are opportunities for successful operators to build a strong competitive proposition and acquire significant market share.
Future Prime
Customers – high
product holding, with a
hope that their worth
will increase.
Prime Customers –
should be retained at
all costs
Potentially Prime
Customers – focus is
on deepening the
relationship to
maximise wallet spend
Investible Assets
Low High
Low
High
ProductHoldings
Current Competitive Landscape
► Currently, providers are focused on retaining and acquiring
„prime‟ customers in order to increase and secure their
Assets Under management
► In addition, they are protecting their high potential
customers, while seeking to deepen their relationship with
these customers
► With „future prime‟ customers cost effective service and
loyalty propositions are being developed to reward
customer loyalty.
► In addition, sophisticated CRM systems are coming online
that identify when a customer moves up the value chain,
allowing sales agents to intervene at an early stage.
In a growing market there are numerous opportunities for organisations dedicated to delivering true customer value.
The strongest competitors are already planning for tomorrow‟s success today.

4. SEYMOUR SLOAN
IDEAS THAT MATTER
Wealth Management – Trends and challenges
4
► The US remains the largest wealth market but India has the fastest growing HNWI population. Asia and Latin America
fuelling the overall increase in AUMs
► Expansion in emerging markets will shift to secondary centres of the region. Increasing economic activity in Indonesia is
creating opportunities in markets not previously considered.
► In The increase in Islamic wealth increases the focus on Islamic financing propositions. The same will be true within
other cultures.
► Changing demographics towards a younger wealthy population (often with high female representation) in emerging
markets has seen investment patterns change
► In Asia Pacific (excluding Japan) 41% of HNWI were 45 years or younger as compared to US where 68% population
was more than 55 years old
► The younger generation have a different investment attitude and is more likely to make riskier investments. They are
also more comfortable with digital channels and more likely to be active on social networking and internet based
platforms
Global Industry Trends
Source: Western European Wealth Markets Database, (Datamonitor)
► In 2010, the 1.5 million affluent individuals in Sweden
held $292bn or 77% of the total liquid assets. They also
accounted for 21% of the total adult population, roughly in
line with the Northern European average
► The value of liquid assets is forecast to increase to
$340bn by 2016 at a compound annual growth rate of
4.8%
► By 2016 the assets held by the mass affluent in Sweden
will over $225bn
► Building the propositions to secure the biggest share of
this asset pool as possible is the challenge for most
providers as customer attitudes and behaviours change
Swedish Trends

5. SEYMOUR SLOAN
IDEAS THAT MATTER
Wealth Management – Trends and challenges
5
Global Industry Trends
Source: Western European Wealth Markets Database, (Datamonitor)
► In 2010, the 1.5 million affluent individuals in Sweden
held $292bn or 77% of the total liquid assets. They also
accounted for 21% of the total adult population, roughly
in line with the Northern European average
► The value of liquid assets is forecast to increase to
$340bn by 2015 at a compound annual growth rate of
4.8%
► By 2015 the assets held by the mass affluent in Sweden
will over $225bn
► Building the propositions to secure as large as share of
this asset pool as possible will be the challenge for most
providers as customer attitudes and behaviours change
Swedish Trends
The US remains the largest wealth market but
India has the fastest growing HNWI population.
Asia and Latin America fuelling the overall
increase in AUMs
Expansion in emerging markets will shift to
secondary centres of the region. Increasing
economic activity in Indonesia is creating
opportunities in markets not previously
considered.
In The increase in Islamic wealth increases the
focus on Islamic financing propositions. The
same will be true within other cultures.
Changing demographics towards a younger wealthy
population (often with high female representation) in
emerging markets has seen investment patterns
change
In Asia Pacific (excluding Japan) 41% of HNWI
were 45 years or younger as compared to US
where 68% population was more than 55 years
old
The younger generation have a different
investment attitude and is more likely to make
riskier investments. They are also more
comfortable with digital channels and more
likely to be active on social networking and
internet based platforms

6. SEYMOUR SLOAN
IDEAS THAT MATTER
6
Common Customer Trends across Financial Services
Seymour Sloan Research Findings Common Customer Trends
Customer engagement with WEALTH MANAGEMENT (% of
respondents)
Expectations of customer experience are evolving
in a time poor world - convenience and low effort are
key
The winners will be those who transform their
business to be more relevant, more joined up and
more responsive to their customers
Customers demand meaningful and relevant
interactions – mastering customer insights is critical
Customer's adoption of digital technologies is
shifting control from organisations to customers
Customers are interacting across multiple channels
more than ever and expecting integrated
experiences
Customer relationships are becoming more
complex, with customers becoming less loyal
Transforming customer capabilities
drives sustainable growth
6
Are confident they
are on track to
financially achieve
the retirement they
would like¹
Have never seen
a financial
adviser /
planner¹
Would ask a friend
or colleague for a
recommendation
when looking for
financial adviser²
Drop out of the
advice process
after the first
meeting²
Prefer to
receive super
advice through
a face-to-face
meeting²
Of Generation Y
are likely / very
likely to use
simple online
advice services²
36% 65% 46% 50% 73% 86%
Financial Advisor
Relationship
Manager
Offered product
based solutions
Transactional Fee
based
Lifelong planning
advisor
Trusted Partner
Consolidated assets
and liabilities
Advisory fee-based
Then Now Today‟s firm focus
► Are we organised the right way to
grow our business and service our
clients?
► Do we have the right solutions for
our clients across different life
stages with the service models to
support them?
► Are we confident that we can satisfy
all our legal, compliance and
regulatory requirements?
► Do we have the right technical and
operational platforms in place to
provide a consistent and distinctive
client experience?
A key change has been the change in relationship between customer
and provider. The fundamental principles governing the relationship are
now based around trust and collaboration

7. SEYMOUR SLOAN
IDEAS THAT MATTER
7
Customer Trends
Industry Trends
Expectations of customer
experience are evolving in
a time poor world -
convenience and low effort
are key
Customers demand
meaningful and relevant
interactions – mastering
customer insights is
critical
Customer's adoption of
digital technologies is
shifting control from
organisations to
customers
Customers are interacting
across multiple channels
more than ever and
expecting integrated
experiences
Customer relationships are
becoming more complex,
with customers becoming
less loyal
An aging
generation
prepares to retire,
more affluent than
any before it
► ‘Affluent’ customers will be
a key battleground, with
strong focus on this
segment
► A trusted adviser
relationship can be key to
building loyalty
► Pairing detailed customer
insights (risk, contextual,
behavioural and
transactional data) with
execution capability creates
market advantage
► Digital technology adoption
at all ages offers
opportunities to interact with
affluent customers who are
highly mobile
► Social media use by wealth
managers as part of a
broader engagement plan
can demonstrate
leadership, build
relationships
► Opportunity to develop
loyalty/advice program -
may include price savings,
tiered access to value-add
services, relationship
recognition
Margin
compression
drives industry
consolidation in
pursuit of scale
► Straight-through processing
offers opportunity to reduce
processing and duplication
of effort, driving scale and
reducing cost
► Enhanced data analytics
are required to drive cost
efficient growth in share of
wallet
► Simple products that can be
applied for and established
online can deliver on
reduced cost and customer
ease
► Increasing ease of digital /
self-service usage has the
potential to direct traffic to
lower cost channels
► Organisations that do not
recognise loyalty and tenure
risk losing customers to
competition
Evolving
technology makes
it easier than ever
to engage with
customers
► Applying principles of
simplification, convenience
and proactivity offers ability
to create new experiences
► Complementing customer
insights with digital creates
new opportunities in areas
such as 1:1 marketing
► Opportunity for Facebook,
Twitter and Google to make
inroads into Australia’s
payment systems
► Customers expect to be
able to view and manage
investments across
channels, including mobile
► Increasing use of social
media and peer to peer
networks to gain referrals
and drive advocacy
Wealth and
banking
distribution and
platforms continue
to converge
► Key opportunity to simplify
interactions enabled by
systems and processes in
order to meet or exceed
customer expectations
► It is key that leads /
opportunities are captured
and shared across wealth
and banking in order to
holistically address
customer needs
► Opportunity to leverage
existing banking digital
capabilities and extend for
wealth
► Integration can be
supported via single login to
view a customer’s total
balance sheet
► Big four banks continue to
focus on wealth penetration
– hypothesis that this will
increase beyond a third of
their customers
Global
governments and
clients view
financial markets
with suspicion
► Trusted adviser
relationships can be
strengthened by providing
education, advice and
ensuring transactions are
executed smoothly
► Relationships and loyalty
will be built based on
understanding and meeting
customer needs – not
pushing product
► Ease of digital access can
meet a key need of visibility
and transparency of asset
performance
► Consistency in customer
service across channels
and delivering on promises
is key to meeting
expectations and building
trust
► While customers are more
likely to seek professional
wealth management, they
are less trusting and more
sceptical than in the past
Customers demand
access to financial
advice and products
on their terms
► Opportunity for scalable
advice to re-invigorate how
customers seek and receive
advice on an issue basis
► Opportunity to more
effectively leverage
customer insight to identify
cross-sell opportunities for
existing customers
► Demand for simple, easy to
understand wealth products
that can be purchased and
managed digitally is likely to
increase further
► Combining multi-channel
access with easy access to
advice and other products/
services allows customers
to engage as needs change
► Reduced use of financial
advisors for simple products
► Secondary market for
specialist and complex
investments via advisors
Wealth Management: Key Trends and Our Hypotheses
The industry faces unprecedented opportunities and challenges as a result of the GFC and consumer adoption of new technology. An
affluent and aging population underpin longer term growth prospects

8. SEYMOUR SLOAN
IDEAS THAT MATTER
Key regulatory changes that have shaped the market
Dodd Frank Act, FATCA
Facets such as registration of
investment advisors with SEC,
introduction of fiduciary standards
(which are conflicting with DOL’s
standard) and reporting of financial
assets outside the US will
substantially increases compliance
requirements and costs
Singapore: Private Banker
Code of Conduct
The code focuses on areas
such as ethics and client
relationship management,
which is expected to push
up compliance costs
Hong Kong: New Rules for
Wealth Management
The new rules, which
include registration of
structured products with the
Securities and Futures
Commission and about
defining a private client.
These would result in an
increase in compliance
costs
China: New Rules for Wealth
Management
The new rules will significantly
restrict the ability of banks to
provide wealth management
services and force them to
focus on alternative ways to
attract customers
UK RDR
Implementation of RDR will
have a significant impact on
the training costs and
overall higher staff pay for
wealth managers, and
improving cost transparency
may result in clients
becoming extremely price
sensitive

9. SEYMOUR SLOAN
IDEAS THAT MATTER
Key regulatory changes that have shaped the market
• Fiduciary Duty: The regulation provides SEC the authority to impose a fiduciary duty on brokers who give investment advice --the
advice must be in the best interest of their customers.
• Registration of investment advisors: Due to the regulation, the thresholds for determining whether an adviser is to register under
federal or state law will change and may force most of the investment advisors to register with the either state regulators or the SEC.
• Change in charging mode: Advisers generally may only charge performance-based fees (i.e. fees based on investment success rather
than the usual percentage-of-managed-assets fees) to “qualified clients.”
• Significant increase in recordkeeping and bookkeeping activities: Dodd-Frank requires sponsors of private funds to maintain
voluminous records for the funds, available for SEC examination and to the new Financial Stability Oversight Council, as well as to
investors
• Consumer Protection with Authority and Independence: A new independent supervisor, housed at the Federal Reserve, with the
authority to ensure accurate information is presented.
• Foreign Account Tax Compliance Act (FATCA) was enacted to combat tax evasion by US persons holding investments in offshore
accounts.
• Under FATCA, US taxpayers holding financial assets outside the US will report those assets to the IRS. In addition, FATCA will require
foreign financial institutions to report directly to the IRS certain information about financial accounts held by US taxpayers, or by foreign
entities in which US taxpayers hold a substantial ownership interest.
US: Dodd Frank Act
US: FATCA

10. SEYMOUR SLOAN
IDEAS THAT MATTER
Key regulatory changes that have shaped the market
 The Retail Distribution Review (RDR) will become affective from 1 January 2013 for all retail investment products and to the companies
that produce or distribute these products and services, such as banks, product providers, Independent Financial Advisers and wealth
managers.
 RDR is based on the following three key goals:
 Clear services description: Companies will need to describe their services as either “Independent advice” or “Restricted
advice”
 Transparent industry charges: Under RDR, all payments are supposed to be made through „adviser charges,‟ and directly reflect
the services being provided to clients.
 Greater adviser professionalism: Enhanced professional standards and accountability of individual investment advisers.
Advisers will have to possess a Qualifications and Credit Framework (QCF) Level 4 qualification.
 Singapore's Private Banking Advisory Group introduced the code of conduct for private banking industry in 2011 and the Code is based on
the following two main pillars:
 1. Competency: Highlights the key relevant competencies required for a financial advisor
 2. Market Conduct: Market conduct standards to ensure professionalism, client due diligence, appropriate advisory standards and
resolution of client complaints.
UK RDR
Singapore: Private Banker Code of Conduct

11. SEYMOUR SLOAN
IDEAS THAT MATTER
Key regulatory changes that have shaped the market
• The new rules were effective from 1 January 2012. Following are the highlights of the rules:
• Banks cannot use wealth products to attract deposits or bundle products in other promotions Banks cannot lure deposits by raising
interest rates in "disguised" forms.
• Promotions cannot be aired on television and they must be fair and open, and explain potential risks
• Sales tactics such as price discounts and free gifts have been discouraged
• Banks cannot promise investment returns or vow to undertake losses when selling products
China: New Rules for Wealth Management
 Under the new rules, If a structured product is offered to Hong Kong‟s retail public, it must be approved by the Securities and Futures
Commission (SFC), although exemptions exist for offers to professional investors.
 However, the definition of professional investors has become more confusing as a clear distinction between retail and private investors is
now even harder to make.
 High-net-worth investors will face tougher accreditation standards under the revised code. These standards include demonstrating
knowledge, expertise and awareness of the risks involved in “relevant products and markets”, as well as a separate written assessment for
each product type and market. That assessment must be repeated where an investor has ceased to trade in that product or market for
more than two years.
Hong Kong: New Rules for Wealth Management

12. SEYMOUR SLOAN
IDEAS THAT MATTER
HOW THE MARKET IS
RESPONDING
12

13. SEYMOUR SLOAN
IDEAS THAT MATTER CONFIDENTIAL 13
The current market has forced most providers to assess their strengths in the
market and as such a range of strategic options are available
Strategic
Option
Description Used By
Organic
Growth
• Increase in customer numbers in core markets
• Increase in Assets under Management per customer
• Increase in average product holdings, per customer
• Migration of high value customers to high profit propositions
Growth by
Acquisition
• Acquisition of books of small private banks, wealth managers
and IFAs
• Acquisition of specialist teams an bankers from existing
leading players
Focus on
International
Expansion
• Acquisition of foreign operations in high growth/value markets
• Establishment of booking offices in profitable markets to
service customers
Rationalisation
of existing
operations
• Investment in IT systems to improve automations and reduce
errors
• Creation of CRM system that provides a single view of the
customer and improves prospect selection
• Investment in mobile and internet technology to improve
customer access and contact
International
Footprint
Optimisation
• Align locations to strategic strengths
• Exit unprofitable markets
• Consolidate functions under a Shared Service Centre
All strategic solutions will incorporate a number of different elements reflecting the challenging market that exists. However, all providers will define
their strategy based on the answer to three key questions:
• What are our strengths and competitive advantages (areas for growth)?
• Where are our competitive strengths and where are we competing unfavourably (exit unprofitable markets)
• How can we reduce operating costs and make the business more agile and responsive to customer need.

14. SEYMOUR SLOAN
IDEAS THAT MATTER CONFIDENTIAL 14
A view on how some of the leading players are adapting to the new market
1/2
► Barclays initiated a five year, GBP 350 million investment program to position Barclays
Wealth as a top tier player in the business. Barclays plans to spend 40% of the investment
spend on client facing talent while the remaining on upgrading its technological and physical
infrastructure.
► The bank has clearly defined its target customer segment as clients with investable assets of
more than GBP 5 million and not to compete in retail brokerage or mass affluent
segmentsThe main system change is the migration of all customers to a single platform,
using consistent data, to enhance the CRM platform – giving staff a comprehensive view of
each customer
► Barclays has identified three key market segments for focusing its expansion plans – US, UK
and Global high net worth segment. The Bank aims to service these client segments on a
global basis out of three hubs in London, Geneva and Singapore.
► Barclays Wealth‟s two-thirds of infrastructure costs and one-third of people are already
shared with the Corporate and Investment Bank. This will not only help the bank to improve
productivity and contain costs but also enable them to offer a wide range of services to their
clients because of the reach within different business segmentsProduct propositions were
developed to encourage cross-selling, including discounts for multiple product holdings. In
addition, a loyalty scheme was developed to reward customers with significant relationships
with the bank.
► Bank of America uses different brands to offer services to different customer segments. The
company uses its „Merrill Edge self-directed Investing‟ platform for the retail segment, „Merrill
Edge Advisory Center‟ for the potential mass affluent segment, „Merrill Lynch Wealth
Management‟ for the mass affluent and affluent segments, and „BoA Private Banking and
Investment Group‟ and „U.S. Trust‟ for Global and American HNWI and UHNWIs respectively
► Bank of America disposed off First Republic, an ancillary private bank it acquired as a part of
Merrill Lynch. The bank also disposed off the long term asset management business of
Columbia Asset Management in 2009. Since its acquisition of Merrill Lynch, Bank of America
was been busy integrating and realizing synergies from multiple businesses it already owned
and those it acquired from Merrill Lynch
► In 2010, Bank of America stepped up its marketing effort and launched different advertising
campaigns for its Merrill Lynch Wealth Management as well as for U.S. Trust brands

15. SEYMOUR SLOAN
IDEAS THAT MATTER CONFIDENTIAL 15
A view on how some of the leading players are adapting to the new market
2/2
► Although the engine of growth in the industry has shifted to emerging markets in Asia and
elsewhere, developed markets retain their importance given their large wealth pool. Credit
Suisse has identified entrepreneurial segment and generation transfer of wealth as market
segments where opportunities for growth remain over the next few years
► Regulators have increased their oversight on the financial sector and offshore wealth
management grabbed headlines over the last two years. Credit Suisse recognizes these
challenges are in shifting to a business model that is more driven by providing on-shore
services
► Credit Suisse is already one of biggest players in the wealth management space in US and
Europe. The bank is, therefore, focusing its expansion efforts in Middle East and Asia. Credit
Suisse extended its coverage in smaller national markets like Bahrain in the Middle East,
upgraded its presence in India to a full service branch and opened a family office in
Singapore
► Driven by the increasing regulatory challenges post the financial crises and an increased
oversight on offshore wealth management business models, UBS focused on improving its
onshore business capabilities in 2010. UBS focused on building onshore capabilities across
key geographies, like Europe, and across all customer segments
► Although UBS is already one of the top players in the segment, the bank aims to increase its
market share further by growing at double the pace compared to the market. The customer
segment remains one of the most profitable client segments. UBS set up a new Global
Family Office group as a partnership between its UHNWI unit and the investment bank to
provide a wide range of services to this specialized group
► UBS has created a new Investment Products and Services unit in Switzerland which
combines expertise from wealth management, retail and corporate bank, investment bank
and the global asset management division. The team delivers high quality investment
content and channels market and product ideas to client advisors as well as clients
► UBS focused its expansion plans in key growth markets in Asia (Hong Kong and Singapore)
and the emerging markets (Middle East, Latin America and the CEE)

16. SEYMOUR SLOAN
IDEAS THAT MATTER
BUILDING A WINNING
FORMULA
16

17. SEYMOUR SLOAN
IDEAS THAT MATTER CONFIDENTIAL 17
Successful providers are strong across 4 key areas while those that struggle
have difficulty reaching excellence in these areas
► Segmentation - segmentation aligned to strategic
goals. Effective of matching customers to service
channels based on cost/revenue analysis
► CRM - capability to proactively identify new sales
prospects as well as providing a 360 degree view on the
customer. Ability to migrate customers up and down the
value chain as their circumstances change.
► Proposition - Strong internal products and capabilities
to provide effective investment and portfolio solutions.
Value added options to reward loyalty. Flexible products
to match differing customer need.
► Service and Distribution- Multi-channel servicing
capability to reflect the plurality to customer touch-
points. A front-end sales and service portal that is
integrated into the product platform and to all middle
and back office interfaces. A low ratio of Relationship
Managers to customers to increase contact time
Successful Wealth Managers succeed across the
following areas
► Segmentation – poor segmentation with no overall
strategic goal. Segmentation parameters are ineffective,
selecting low profit customers.
► CRM – fails to provide a singular view of the customer
relationship. System merely provides customer
information without highlighting products to sell. Unable
to identify future HNW customers.
► Proposition – design fails to assess internal delivery
capabilities. Ineffective cost to serve analysis. No added
value in proposition. Ineffective sales force scale and
expertise. Proposition fails to satisfy customer need.
► Service and Distribution– cost to serve is too high for
many customers. Focus is on branch service only. Lack
of integration between RM service and CRM systems.
High value customers have little contact time with RM
due to poor segmentation and proposition build. Service
channels not staffed with suitably qualified staff at the
right scale.
Unsuccessful Wealth Managers struggle wit the
following areas
There are other areas where excellence is part of strong performance. These include:
► Risk Management
► Regulatory Compliance
► Skills, Professional Development and Culture
► Operational Efficiency and
► Reward and Remuneration

18. SEYMOUR SLOAN
IDEAS THAT MATTER
Overall success will be driven by succeeding in four key areas and
building initiatives to improve each area
1. Grow & Retain
Client Assets
2. Efficient
Distribution and
Servicing
4. Build a Scalable
Foundation
Business
Strategy
Segmentation
and CRM
Initiatives
Distribution
and Servicing
Initiatives
Product &
Advice
Initiatives
A
B
C
Infrastructure
Initiatives
Cross-Org
InitiativesD
E
3. Enhance the Offer
& Experience
Focus Area Category Key Initiatives
A5. Build and test of CRM
System
A1. Design and Develop
Segmentation Model
A2. Apply Segmentation to
Existing Customers
(Insight)
A3. Identify New
Customers to Target
A4. Design of CRM system
B1. Deliver Competitive
Online & Mobile Capabilities
B3. Client Acquisition
Through Engagement
Programs
B2. Deliver Competitive
Call Center Capabilities
D1. Develop Enhanced Risk
and Compliance Frameworks
D2. Launch Targeted
Marketing / CE&A
E1. Develop Effective Staff
Incentive and Remuneration
Schemes
E2. Enhanced
Relationship Management
Training
C1. Develop Product to
Appeal to Target Segments
C2. Develop Product
Relationships to Cross-Sell
C3. Build Younger
Generation Solutions
C4. Develop Advice
Proposition
C5. Develop Self selection
features
D3. Develop Tax
Reporting Solution
D4. Drive Organisational
Efficiency and Productivity to
Fund Growth
A6. Implementation of
CRM System
C6. Develop Self-Guided
Investment platform
D5. Product and Servicing
Simplification

19. SEYMOUR SLOAN
IDEAS THAT MATTER
DEVELOPING EFFECTIVE
SEGMENTATION
19

20. SEYMOUR SLOAN
IDEAS THAT MATTER
Customer Insight – Current Challenges
20
As financial institutions have come to realize,
unprofitable customers can be classified into
the following three groups:
► Unprofitable due to lack of profitable
relationships
► Unprofitable due to improper charging or
inappropriate servicing channels
► Truly unprofitable
To avoid the unprofitable pitfalls, financial
institutions must implement processes and tools
that enable them to capture higher wallet share,
migrate customers to more cost effective
channels, and properly identify customers to be
de-marketed or divested.
► provider face the challenge of understanding their current and future customers. They need to understand the existing
relationship and convert it into additional sales and the likely cost to serve for existing customers..
► In addition, most provider require a tool that provides staff with a real-time snapshot of al customer relationships in order to
make relationship management and cross-selling easier.
► To achieve this, providers must invest in market leading segmentation techniques and CRM systems.
For successful and profitable relationships, financial institutions must
understand their customers, anticipate their needs and requirements, and
drive sales. To accomplish these objectives, institutions must be able to
answer the following, all-important questions:
► Who are my best customers?
► What products and services do they require?
► How do their product needs vary across regions and branch trade areas?
► How can I package products, based on these needs, to maximize value
and corresponding fee revenue?
► How can I cultivate a better relationship through communication?
These questions represent the fundamental challenges faced by every
financial institution looking to successfully implement a customer profitability
and segmentation process.
With clean, accurate data, financial institutions can now begin to get a 360° view of their customers. A detailed, chronological
roadmap that focuses on predictive analytic models will help financial institutions:
► • Optimize distribution networks
► • Define untapped opportunities and maximize branch
► performance through a better sales goal-setting process
► • Analyze and visualize market opportunities for sales
► planning activities
► • Identify the next best purchase and profitability for
► individual customers or new prospects

21. SEYMOUR SLOAN
IDEAS THAT MATTER
Seymour Sloan has developed a six-step methodology to developing
customer segmentation
Segmentation Methodology
► Collect and assess
existing information
(internal transaction
data, external research,
etc.)
► Hypothesize
segmentation criteria
► Identify additional data
sources based on
hypotheses
► Collect primary data
(surveys, interviews,
etc..)
► Perform data mining
and statistical analysis
► Test/ modify segment
criteria and
differentiation factors
► Classify customers into
segments based on
defined attributes
► Test that segments are
mutually exclusive,
collectively exhaustive
and meet viability
criteria through
iterations and testing
► Develop diagnostics
information to flesh out
segments
► Re-evaluate defined
segments
► Perform comparative
analysis to identify most
valuable segments
► Assess the company‟s
ability to attract various
segments
► Prioritize segments
based on analyses
► Develop segment-specific
treatment offerings and
tactics
► Prioritize initiatives based
on segment prioritization
and cost/benefit
assessments
► Communicate findings
► Confirm immediate and
long-term business
objectives
► Understand the role
segmentation will play
in support of the
objectives
► Determine timelines
and resource
requirements to conduct
the segmentation
exercise
► Migrate scoring
model and segment
codes to customer
information system
► Design and
implement segment-
specific treatment
offerings and tactics
► Define and manage
channel delivery
1 2 3 4 5 6
Define Business
Objectives
Identify / Build
Data Set
Create
Segments
Profile
Segments
Create
Treatments
Operationalize
Segmentation
The Seymour Sloan segmentation approach is a powerful means to identify unmet customer needs. We help identify underserved
segments and develop appealing products and services.
The six-step process will develop an in-depth view of your customer base from which, you can develop a strategic approach for
maximising your market opportunity.

22. SEYMOUR SLOAN
IDEAS THAT MATTER
The segmentation design is critical to the usability of the output
Successful segmentation lies in effective design. Our approach has been developed over a number of successful engagements
and is designed to give you meaningful insight into the customers to focus on. Our multi-dimensional approach helps unlock real
customer value.
1. Analyze the
competitive
situation
3. Identify and
use strong
variables
2. Understand
your customer
across three
dimensions
4. Apply the
right analytical
approaches
Identify
Customer
Segments
Data
Collection
Define
Segmentation
Scope &
Objective
Analyze the competitive situation
Competitors Customers Capabilities
1
Strength of relationshipNeeds & Behavior
Value
Understand your customers across three dimensions2
► Value/lifetime value
► Needs and behavior
► Strength of relationship
Identify and use strong variables, which are:3
► Correlated to behavior (current and
future)
► Stable over time
► Related directly to customers
Apply the right analytical approaches4
Data Collection
and
Manipulation
Segment
Generation
Basic Advanced
Basic Advanced
Data MiningTab Analysis
Brainstorming Cluster Analysis
Characteristics
(e.g. lifestage,
demographics)
Attitudes
(e.g. desire for
convenience, control,
approach to running
business)
Product needs
(e.g. product, price)
Brand / service
needs
(e.g. channel,
information)
Buying & usage
behavior
(What, why, how, how
much, tenure)
Value
(Current, potential &
future)
Current & potential customers

23. SEYMOUR SLOAN
IDEAS THAT MATTER23
Understand what a profitable
customer looks like first…
…and use this insight to identify new
high potential customers
Segment existing customer first
Quantify the actual and potential value of existing
customers
Prioritize the customer segments and develop
approaches to optimize value
Understand which needs are currently being met and
where new opportunities exist
Identify potential customer
Align customer segments and offerings to the
organization
Use your customer insight to understand the
characteristics that constitute a profitable customer
Create the customer offering to target the new
customer segment
Identify where new high potential customers segments
exist and how they can be reached
Assess attractiveness of the segment
Getting the segmentation right:
…make the most of what you have first then grow through the external market
Organizations should start by optimizing the value of their existing customer
relationships first and then use this insight to develop profitable relationships with
new customers
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to
use in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to
use in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to
use in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to
use in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to
use in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to use
in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”
► I want a phone to
use in emergencies
► It must be simple to
use and operate
► I like managing my
account “in-store”

24. SEYMOUR SLOAN
IDEAS THAT MATTER
TALK
TO US
CONTACT:
Terry Chapendama - Director
terry.chapendama@seymoursloan.com
Read our blog at:
www.seymourthinks.wordpress.com
Follow us on twitter
@seymoursloanuk
Visit us online www.seymoursloan.com
ABOUT Seymour Sloan
We formed the company in order to do
special things for our clients through the
creative use of new technologies and
techniques.
We help companies understand a
complex and ever-changing technology
landscape, along with changing
customer behaviours, developing
strategies and solutions to maximise the
opportunities available. We operate at
the intersection of digital, strategy and
customer, building a track record of
driving customer growth across our
three core industries.