VakifBank - Innovation in Technology Development
Company: VakifBank, Istanbul, Turkey
Company Division/Group: Türkiye Vakıflar Bankası T.A.O.
Company Description: Vakifbank was established in 1954 in order to make the best use of the country's fund resources in line with the needs of economic development. Headquartered in Istanbul, the bank operates in retail, commercial, corporate and agricultural banking with 890 branches, 16798 employees and more than 4200 ATMs.
Nomination Category: Technology Categories
Nomination Sub Category: Award for the Innovation in Technology Development - Financial Services Industries
Nomination Title: Customer Churn Model
Provide an essay of up to 625 words describing the nominee's innovative achievements since July 1 2018:
Churn means loss of customers and we do not want or expect any customer who actively uses our products to leave our bank. Some research says that the cost of gaining new customers in industries where competition is very intense is about 4 times higher than the cost of holding our existing customer. Especially in environments where customer preferences do not change very often, such as financial services, customer loss can mean significant revenue losses. Therefore, it is very important to accurately predict customer losses in advance. In addition to sales and marketing methods, it has become an important strategy to increase the satisfaction and loyalty of existing customers.
Our goal in Churn Model is to identify customers who are likely to stop using our products or services. Being aware of this situation before the customer leaves us, gives us an advantage in trying to increase customer satisfaction and loyalty by doing preventive activities to avoid losing our customer.
When calculating the probability of customers leaving VakifBank, all products and financial transactions were taken into consideration. It was quite challenging to define the concept of churn in the beginning. In addition to demographic and income information, our customers are informed about the financial transactions carried out by our Bank in the last 3 years, transactions in savings and investment products, loans, limit and expenditure information of credit card products, invoice payments, transaction and amount information related to product transfers, product usage and different product group usage number data were also calculated.
With the variables mentioned above and the new variables created using these variables, we have calculated the probability of our customers leaving us using statistical models with the SPSS Modeler application. According to the scores calculated between 1 and 100, we can now know the probability of our customers leaving us.
The calculated possibilities were added to our Banking CRM system, which can be seen by customer representatives at our branches and call center. When communicating with our customers, our customer representatives can see the possibility of our customers to leave us through our CRM system and, accordingly, take appropriate approaches to our customers, make useful financial suggestions and offer special offers.
In addition, we try to offer the most suitable offers to customers, who are about to leave us, during the campaigns carried out by our marketing departments, and try to increase customer satisfaction and loyalty. Marketing strategies for regaining our customers are being developed for our customers who have abandoned us.
As VakıfBank, we now have a non-reactive, proactive marketing approach. In this way, we prevented customers of various segment levels from leaving our Bank by performing the act of keeping our customers, which is very critical in financial terms, and saved approximately $ 1,000,000.