Is your firm spending money on customer relationship management (CRM) without understanding client needs or profitability? According to the findings of Ernst & Young's Eighth Annual Special Report on Technology in Financial Services, many financial services firms are doing exactly that.
Survey results revealed that CRM spending increased 31 percent in 1999 even as technology spending slowed. Yet 63 percent of the respondents weren't sure if their CRM strategies were increasing or decreasing profitability. Surprisingly, only 25 percent of these respondents even segment their customers by profitability.
Ernst & Young surveyed more than 125 banks, brokerage and insurance firms in the U.S. and Europe, South Africa, Latin America, Australia and Asia-Pacific.
In this report, Ernst & Young advises financial services firms to use technology and CRM to offer mass customization of products as a way of ensuring successful client relationships in the era of the Internet.