Innovative Success Story: Abbey National

Putting the Customer at the Heart of Abbey National

When Abbey National deployed Innovative Systems’ i/Lytics™ Data Linking capability in 1995, it was delighted with its data cleansing feature. Six years on, the company has worked with ISI to develop the solution to support its e-commerce initiatives and create sophisticated customer profiling models — increasing customer satisfaction and saving over £400,000 in direct mailing costs in 2001.

Since its conversion to plc status in 1989, Abbey National has doubled its customer base from eight to 15 million by pursuing a strategy to be the UK’s premier financial services company. For Abbey National the relationships it holds with every one of these customers is the foundation on which it builds its success — and keeping them happy means treating them as an individual and giving them the widest choice in how they transact business with the company.

For six years Abbey National has used ISI’s i/Lytics Data Linking capability to increase the quality and accuracy of the information it relies upon to serve its customers. With the growing complexity of an increasing number of customer interaction channels, the company has worked with ISI to enhance the core solution to improve information quality, support its e-commerce initiatives and increase the sophistication of its customer profiling.

Creating Multiple, Consistent Customer Views
Over the past six years Abbey National has been re-engineering its business to move from a product-centric to a customer-focused organisation. As an initial step in this programme the company implemented ISI’s Data Linking capability to enable it to de-duplicate records and increase the accuracy of its customer information. Using the Data Linking capability, Abbey National was able to cleanse its customer data and construct a single, consistent view of the individual relationships held with customers from which it could track all interactions and purchases.

However, as the company continued to offer its customers increased choice, and in particular developed its e-commerce channel, it became harder to support a single customer view. With a customer able to walk into a branch, pick up the telephone or bank online, Abbey National wanted a customer record that fulfilled the differing needs across the business. Using the Data Linking capability, the company had created routines within the solution to automatically match customer records where there was sufficient reason to believe they were the same customer. The problem it now faced was that this might compromise the security of the Web service.

Caren Black, Head of Information Quality at Abbey National, said, “When you decide to make accounts accessible online there is simply no margin for error. You cannot risk incorrectly de-duping a record and enabling the wrong customer to transact on the wrong account.”

She continued, “However, if you don’t de-duplicate records you risk making business and marketing decisions on inaccurate data and can waste thousands of pounds mailing customers information on products they already have. The choice you face is create a separate database to support the Web channel, and lose all the advantages of a single customer view — or find a way of managing multiple customer views that are consistent across the board.”

Degrees of Customer Validation
Abbey National decided to ask ISI whether this could be achieved using the Data Linking capability.

Caren Black said, “We had developed an excellent working relationship with ISI and we knew we could trust them — if their product couldn’t do what we needed they would be the first to say so. However, they confirmed that we could build customised and automated routines and rules within the core solution to create and support multiple, consistent customer views.”

With ISI’s assistance Abbey National has tailored the Data Linking capability to create multiple customer views held within a single information database that is accessible by all areas of the organisation. Each view has a varying degree of customer validation depending upon its application within the business.

The legal view is used to support the e-commerce channel and is created once all a customer’s account holdings have been fully validated with the customer. When a record is given legal status, that customer can be allocated a single password that gives them totally secure access to all their accounts online.

To compile the accurate view Abbey National uses the Data Linking capability to find duplicated customer records that, according to business rules built within the system, match 100%. Automated routines then prompt call centre or branch operators to fully validate these records during a customer interaction so that they can then be elevated to the legal view.

Where it appears that duplicate records relate to the same customer but no validation has taken place, the customer is seen in an implied view. This is used to support marketing profiling and campaigns so that duplicated direct mails are not sent to customers who appear to be the same person, saving money and reducing the instances where customers are targeted for products they already hold.

Abbey National is currently working on creating a fourth, household customer view, which will be held in the same single database to ensure consistency, and will again be produced from protocols and routines built into ISI’s Data Linking capability.

Caren Black explained, “Financial decisions are taken on how they affect the family unit, and a customer’s perception of a company is influenced by the treatment given to all members of the household. The household view gives you a greater understanding of the wider lifestyle needs of your customers because it allows you to view their requirements in conjunction with the people that affect their decisions and choices.”

She added, “For Abbey National this will be the next, hugely important step in our customer-focused marketing, and will undoubtedly move us ahead in the sophistication of our customer profiling.”

Cost Savings, Increased Satisfaction
Today any business area within Abbey National can choose to select the customer view that best suits their needs. The e-commerce channel works with the safe, legal view, whilst marketing chooses the implied view to profile customers and create promotional and direct mailing campaigns. No matter what view is chosen, all data added to the customer’s details feeds through to a consistent record of all the customer’s interactions held within a single, central database.

The success of this approach has been outstanding. In 2001 Abbey National saved over £400,000 in direct marketing costs by minimising the number of customers that are sent duplicated mailings. The hit rate for promotional campaigns and customer satisfaction levels have all increased, as have cross-sales of products.

Caren Black said, “On top of the cost-savings, minimising the number of incorrect or inappropriate mailings our customers receive has increased their confidence in the integrity of the information we hold on them and our knowledge of their financial needs. In addition, we are building an enviable reputation for the security of our online banking.”

Abbey National also recognises that the company has saved time and money by being able to adapt its existing linking solution. As Caren Black explained, “When we were using ISI’s linking solution for data cleansing we were only touching on the power of the product. By looking afresh at the solution and enhancing its existing features, we have achieved what we set out to do, saved ourselves considerable time and money and continued to work with a product and a company that we trust.”

She concluded, “For companies like ourselves that are constantly reviewing technology to meet evolving business needs, I would recommend making sure they’re making the most of the solutions they have already deployed. ISI’s Data Linking capability has always done what we’ve asked it to do, and now we’re asking more from the solution — it’s doing that superbly as well.”

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