Preview

Capital One

Good Essays
Open Document
Open Document
1070 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Capital One
Capital One Financial Corporation

1. How is Capital One’s use of IT different from other mass customization strategies? Capital One uses IT through its information-based strategy (IBS) to “record, organize, and analyze data on the characteristics and behaviors of their customers,” as stated by CEO Richard Fairbank. Their philosophy was to exploit information by constructing scientific models that could be used to both assess the creditworthiness of potential cardholders through FICO scoring, and to customize product offerings for existing ones. This was done through data mining, sorting, customizing offers and marketing campaigns, and then analyzing this data to see what campaigns worked – for what reason and what it returned in revenue and profit generation. This differs from other financial institutions in that these other institutions were compiling data manually, accepting applicants based upon debt-income ratios and were all charging the same interest rate and annual fee. Capital One saw direct marketing as a means to record every interaction with a customer electronically. It allowed them the ability to customize products to each customer and to ensure each interaction was unique. Direct marketing gave Capital One the ability to turn a business into a scientific laboratory where every decision about product design, marketing, channels of communication, credit lines, customer selection, collection policies and cross-selling decisions could be subjected to systematic testing using thousands of experiments. It also enabled the ability to roll out products on a national scale and at full speed once they had been found to work without incurring the large fixed costs that accompany brick-and-mortar operations. It gave them the potential to reinvent the entire economics of a business. Capital One realized that few products were direct marketed and that even fewer firms were fully exploiting the power of statistical analysis.

You May Also Find These Documents Helpful

  • Powerful Essays

    Citibank was able to differentiate its e-business products from those of its competitors by focusing on customer satisfaction instead of only the bottom-line. Customer satisfaction was focused on the support, technology and response time, making sure the clients felt confidence in the brand. The customer service along with the products are the reasons why Citibank is able to keep its recognition and loyalty throughout the world. Citibank used many technologies to get more clients satisfied such as ATM’s, telephone lines, and the paperless system of payments which is a…

    • 1409 Words
    • 6 Pages
    Powerful Essays
  • Powerful Essays

    Citi Bank

    • 2091 Words
    • 9 Pages

    Perform a STEEP analysis to understand the general environment facing Citibank. How will Citibank be affected by external factors? In particular what is the affect of the internet on the banking industry and Citibank?…

    • 2091 Words
    • 9 Pages
    Powerful Essays
  • Best Essays

    Countrywide Financial

    • 3004 Words
    • 13 Pages

    Countrywide Financial was a mortgage-banking firm. They had one of the largest market shares in the early 2000s, when the mortgage market was booming. “No company pursued growth in home loans more aggressively than Countrywide” (NY Times 12/10). They were the leader of their industry, with 500 billion in home loans, 62,000 employees, 900 offices, and $200 billion in assets. Everything had been going well for the company and its employees, until the mortgage crisis began to unfold at the end of 2006. In June 2009, the SEC filed a civil suit against the founder of the business and some of his top management for fraud and insider trading. This came at the height of the mortgage crisis in the US. The founder of Countrywide, Angelo Mozilo, finally agreed to pay $45million in profits and $22.5 million in civil penalties, in which he still admits no wrongdoing.…

    • 3004 Words
    • 13 Pages
    Best Essays
  • Good Essays

    Bank Of America

    • 505 Words
    • 3 Pages

    1. What are the core business processes1 (high level; major business and financial services) performed at Bank of America as part of its product and service offerings?…

    • 505 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    Great Western Bank

    • 1827 Words
    • 8 Pages

    The Great Western Bank of San Diego placed an order of 12 special purpose accounting machines with the Data Max Corporation of Cincinnati, OH. Great Western Bank and Data Max, both agreed to a firm-fixed price of $9,500 per unit and FOB the shipping point. The purchasing manager of the bank designated a particular carrier (yellow freight) and Data Max returned the signed acknowledgement without making any changes to the terms and conditions.…

    • 1827 Words
    • 8 Pages
    Powerful Essays
  • Powerful Essays

    Capital One Case Study

    • 1239 Words
    • 7 Pages

    • What is a case interview? The Case Interview • What specific skills does it assess? • How to prepare for a case interview? • An interactive example.…

    • 1239 Words
    • 7 Pages
    Powerful Essays
  • Powerful Essays

    JP Morgan Chase

    • 1665 Words
    • 7 Pages

    1.Discuss how administrative agencies like the Securities and Exchange Commission (SEC) or the Commodities Futures Trading Commission (CFTC) take action in order to be effective in preventing high-risk gambles in securities / banking, a foundation of the economy.…

    • 1665 Words
    • 7 Pages
    Powerful Essays
  • Good Essays

    costco financial

    • 1274 Words
    • 6 Pages

    Financial analysis is the mean to clarify most important factors that affected Costco performance and resulted in companies’ success. In order to reach that goal, we studied financial performance of Costco for 2008 to 2012. These data obtained from different sources such as Costco annual reports and other respectable financial sources.…

    • 1274 Words
    • 6 Pages
    Good Essays
  • Good Essays

    Direct Marketing 56124260

    • 656 Words
    • 3 Pages

    While most companies continue to rely primarily on the other promotional mix elements to move their products and services through intermediaries, an increasing number are going directly to the consumer. These companies believe that while the traditional promotional mix tools such as advertising, sales promotion, and personal selling are effective in creating brand image, conveying information, and/or creating awareness, going direct with these same tools can generate an immediate behavioral response. Direct marketing is a valuable tool in the integrated communications program, though it seeks somewhat different objectives.…

    • 656 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    Morgan Stanley

    • 924 Words
    • 4 Pages

    There are four largest bookstore chains and with the increasing growth of these superstores, smaller market shakeout was inevitable…

    • 924 Words
    • 4 Pages
    Powerful Essays
  • Good Essays

    Jp Morgan Chase

    • 9136 Words
    • 37 Pages

    JPMorgan Chase & Co. (NYSE: JPM) is one of the oldest financial services firms in the world. It is a leader in financial services with assets of $2.3 trillion., and the largest market capitalization and deposit base of any U.S. banking institution. The hedge fund unit of JPMorgan Chase is the largest hedge fund in the United States with $34 billion in assets as of 2007. Formed in 2000 when Chase Manhattan Corporation acquired J.P. Morgan & Co., the firm serves millions of consumers in the United States and many of the world 's most prominent corporate, institutional and governmental clients. (1,2)…

    • 9136 Words
    • 37 Pages
    Good Essays
  • Good Essays

    Countrywide Financial

    • 866 Words
    • 4 Pages

    1. Are subprime loans an unethical financial instrument, or are they ethical tools that were misused?…

    • 866 Words
    • 4 Pages
    Good Essays
  • Good Essays

    Td Bank

    • 471 Words
    • 2 Pages

    TD bank is the second largest bank in personal deposit account and market capitalization. TD Bank Group offers full range of financial products and services. TD’s primary goal is to deliver exceptional customer service and convenience.…

    • 471 Words
    • 2 Pages
    Good Essays
  • Good Essays

    Others should feel Capital One is more convenient and it offers better service than other banks.…

    • 503 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    5.Sonia Reyes, 2002, Krafting the Total Promo Package, Brand Week, 15 July, pp. 24-276.Michael McCarthy 2002, Direct Marketing Gets Cannes Do Spirit, USA Today, 17 June, p 4B7.Edward L Nash, 1995, Direct marketing: Strategy, Planning, Execution, 3rd edition, McGraw-Hill, New York8.Roger A Strang, 1976, Sales Promotion: Fast growth, Faulty Management, July-August, Harvard Business Review, p116-1199.Abraham Magid M & Leonard M Lodish, 1990, Getting the most out of advertising and Promotion, Harvard Business Review, May-June, pp 50-60.…

    • 4252 Words
    • 16 Pages
    Powerful Essays