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Ajay Kelkar

Vice-President and Head – Marketing | 17 Oct 2005

“HDFC Bank is possibly the only bank in India, and one of the very few in Asia, to have embarked on a data-led marketing analytics campaigns initiative, using marketing automation technology provided by Unica. Through this tool, we have been able to intelligently use the 4-5 terabytes of customer data available in its warehouse. We have set up a team to conduct marketing campaigns in a scientific manner using customer data, usage patterns, preferences, lifecycle, etc, the bank also conducts event-based marketing.”

Ajay Kelkar, Vice-President and Head - Marketing, HDFC Bank is a seasoned marketing ‘campaigner’. He has a combined experience of over 14 years, of which around nine were spent in the consumer goods industry, at P&G and Britannia. He later joined Shoppers’ Stop, where he headed marketing, and was primarily responsible for the retail chain’s CRM initiatives. He has been with HDFC Bank for over two years in which he has led the bank’s marketing team on the pioneering path of data-led marketing analytics.

In conversation with exchange4media’s Pritie S Jadhav, Kelkar speaks about the performance of HDFC Bank and the various marketing initiatives taken by the bank as well as factors that make a bank more preferable than others.

Q. How has HDFC Bank performed in the last one year? What has the growth been like?

Over the last few years, HDFC Bank as a whole has been growing steadily at a rate of 30 per cent or so, and that the bank has managed to maintain that growth rate on a consistent basis, which is a very creditable performance. However, in the product mix, there have been a number of segments, especially loans, which have recorded growth of over 100 per cent over the last year.

Q. What are the various marketing initiatives that have been undertaken by the Bank?

HDFC Bank is possibly the only bank in India, and one of the very few in Asia, to have embarked on a data-led marketing analytics campaigns initiative, using marketing automation technology provided by Unica. Unica has been recognised by Gartner as the leading player in this field.

Through this tool, we have been able to intelligently use the 4-5 terabytes of customer data available in its warehouse. We have set up a team to conduct marketing campaigns in a scientific manner using customer data, usage patterns, preferences, lifecycle, etc, the bank also conducts event-based marketing.

These initiatives also complement our media-based marketing as well as on-the-ground marketing activities, which remain important in the bigger scheme of things. However, the marketing analytics initiative enables us to measure the efficacy of the campaigns, testing every campaign every step of the way, experimenting with creatives, messages, media, etc. There are learnings that can immediately be absorbed and incorporated in the next campaigns, and these campaigns in a way provide us with information about customer choices and preferences that can be used for mass media communication, making those more effective.

Q. So what has been the feedback?

A big hurdle that marketing has always faced is that many people consider it non-measurable, and a possible waste of money. Marketing professionals can talk about visibility and image, but it was not resulting in tangible numbers. Nowadays, with marketers also interacting with CFOs, measurability becomes a key factor. Our marketing initiatives, we can confidently say, have been successful because we have the numbers to back our claims. We can measure the result of a campaign through the sales that they generate, the customers that are added, there is a clear Return on Investment, which from a function point of view, gives the team a stronger voice.

Thanks to the marketing analytics campaigns, we have been able to reduce our ad spends by about 10-15 per cent, and also reduced cost of acquisition, thus getting a bigger bang for the buck. Last year, we conducted around eight or nine campaigns, this year the number will be around 800-900 campaigns, which is a huge scale-up in a very short period of time.

These campaigns also enable the bank to cross-sell to customers, thus increasing customers’ product holdings and consequently customer profitability.

This initiative is equally effective from a customer’s point of view, as thanks to intelligent analysis, our customer is no longer inundated by mindless junk communication, which may not be relevant to him. We are able to analyse a customer’s data and send him/her offers of products and services, and not just the bank’s products, (it could be a deal about a car, discount at a restaurant or a shopping mall) that s/he can avail of, thus strengthening the customer-bank relationship, as the customer appreciates the efforts that the bank is taking to provide value-adds to them.

Q. Are you satisfied with the way HDFC Bank is performing in the market place?

While one can say that HDFC Bank is truly doing very well in the market place, one is never really satisfied as there is always room for improvement. Hindsight always provides learnings into what we could have done better, and we try to incorporate those in our subsequent activities.

Q. What, according to you, makes a bank more preferable than others?

There are several factors that are taken into consideration while selecting a bank, such as trust, service, number of products available, etc. And, last but not the least, a trait that we share with the hotel industry – location of our branches and ATMs. They have to be near the residence or offices of our customers. However, that is slowly changing with the advent of the other direct banking channels like Home Banking, Mobile Banking, Net Banking, etc.

Q. Do you agree that push is rather important in the financial sector?

Yes, push is important in marketing of financial products, and that is how many are still doing business. However, thanks to marketing analytics campaigns, we have turned around a classic push strategy into a pull strategy. What happens is that every customer interaction with the bank leaves behind a footprint. Now, when these footprints are intelligently analysed, a trend and pattern emerges which helps the bank to offer products that are relevant to the customer. Thus, the customer is now himself initiating a relationship with the bank as he has been offered products that he needs at that point of time, with benefits that are customised as per his requirements, and basis his relationship with the bank. So, instead of us having to aggressively sell our products, a communication has been created which makes the offering desirable to the customer.

Q. What media vehicles would you use to send across your message to your target audience?

HDFC Bank has been predominantly using direct mailers, e-mails, and SMS for communicating our message to our target audience as they are the most cost-effective routes of addressing our core target audiences with maximum degree of customisation possible.

Q. What comes first – creative or media – when deciding on your brand communication?

It is very much a chicken and egg situation, isn’t it? How do you develop creatives when you do not know the media that you are going to use to communicate, and how do you select media without knowing what the message is going to be like? But, I think we can go with the creative first, it can always be adapted to suit the media being used. But, the idea, the message is most critical.

Q. How do you target the rural customer?

HDFC Bank has a vast branch network, with a presence in over 200 locations, and consequently, a strong on-the-ground sales presence. To support the various branches in the rural areas, HDFC Bank undertakes regional marketing initiatives, developed keeping in mind the flavours of the region that is being addressed, and again making the communication more relevant to the audience.

Q. Is there any specific reason why rural banking has become so important among banks in general?

It is not that rural markets have suddenly become important. They have always been important. However, with the government’s focus, the trickle-down effect of the great Indian economic growth story, the importance of this vast, largely-untapped market has increased.

Q. Can you elaborate on your retail plans?

Speaking about retail marketing, we will continue with the various marketing activities, both above-the-line as well as below-the-line. At the same time, the Internet as a medium, and the marketing analytics piece as a tool are increasingly becoming more effective, and while we are extremely upbeat about the data-led marketing initiative, we will also take a good, hard look at the Internet as a very effective (cost-wise and reach-wise) medium of communication.

Q. What, according to you, will be the trends in retail industry in the near future?

Customer lifecycle-based marketing using analytics is the way to go in the future, and HDFC bank is proud to have been the early pioneers in this field.

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