Corporate Performance Management

Corporate Performance Management

January 17, 2011

APT Study Reveals Unprecedented Growth In Strategic Testing

Applied Predictive Technologies (APT (News - Alert)), the pioneer of the Test & Learn solution, has recently announced the results of the latest survey on scientific testing at banks.

The scientific testing was aimed at understanding the impact of various strategic and tactical initiatives at leading North American banks. The survey included larger banks, those with more than 2000 branches.

A study on the growth patterns of these banks revealed that the testing had increased by 23 percent in merely a year from 2009 to 2010. Meanwhile, banks with more than $29 billion in assets had increased their testing by 85 percent in the said year. The banks had been actively testing and implementing new ideas as well as strategies in nearly all functional areas, including staffing, pricing, customer retention programs, ATM surcharges, new product introduction and marketing, among others.

According to the results of the survey, more than 38 percent of the strategic tests are focussed on media and marketing programs at the banks, while trying to measure the ROI of numerous media channels that is TV, radio and online, as well as a variety of campaigns focusing on different products and messages.

Also, banks have been investing heavily in testing which has seen a rise of 261 percent in testing of pricing changes and actions related to mergers and acquisitions, cross-channel servicing, relationship management programs, and branch remodels have been the key areas of interest.

Scientific testing has been used to identify the right strategies to respond to regulatory changes, further optimize deposit and loan pricing, and understand the best ways to improve customer retention and cross sell.

APT’s Test & Learn solution enables executives to accurately measure the profit impact of pricing, marketing, merchandising, operations, and capital initiatives, tailoring on-going investments in these areas to maximize ROI, the company said.

The Test & Learn is a powerful fact-based approach for choosing, targeting and tailoring strategic and tactical actions for maximum impact and profitability. Utilizing these sophisticated analytical approaches banks are able to identify the elements of a remodel program help increase ROI, how changing staffing mix between part-time and full-time tellers impacts customer satisfaction and profits, and the optimal strategy for each branch after an acquisition.

In a release, the President of Applied Predictive Technologies (APT), Patrick O’Reilly, said “The banking environment continues to evolve very rapidly. Testing ideas before rolling them out is the most powerful way to de-risk key decisions. Some leading banks have pushed scientific testing to new levels. Their experiences hold important lessons for all banks.”

Carolyn John is a Contributor to TMCnet. To read more of her articles, please columnist page.

Edited by Janice McDuffee

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