What would you recommend that CIBC do with Bankware II? Why?

Question

What will be an ideal response?

Answer 1

An evaluation of Bankware II using a “pros” and “cons” approach is provided in Exhibit B. The major benefits are that it allows customers to evaluate various financial options regarding mortgages and loans, helps with customers’ financial planning, and informs customers about many of the products and services offered by CIBC. The more knowledgeable customer can then discuss options with a Personal Banking Representative (PBR) on an equal footing and the PBR can be more helpful, thus building a better relationship with the client. On the negative side, Bankware II has a narrow target market (customers need to have a personal computer and be an existing customer of the bank), the branch staff cannot load Bankware II on their machines (so they have no working knowledge of its features), and some divisions are not convinced that Bankware II is relationship focused.
In a broader sense, the Bankware II promotion reflects the challenges faced by CIBC in its transition to relationship banking. A CIBC division, Consumer Credit, comes up with an idea, tries to market it internally with moderate success, launches it without getting many of the service delivery people (the branches) on board, and creates some friction within the organization. As well, Consumer Credit does not evaluate the impact of the idea and can only guess at its benefits to customers or CIBC. In the end, it is not known if Bankware II is really more helpful to customers (or the bank) than Bankware.
A brief review of the other promotional initiatives of “We’re Changing the Loan Experience” against the first two evaluation criteria would suggest that the “1/2% off coupon with Thank You note” and “Last Payment on Us” fit the relationship focus. These initiatives provide value for the customer, are future oriented, provide bank personnel an opportunity to build the relationship with the customer, are a personal recognition for the customer, and are tangible (most services tend to be very intangible).
The original Bankware had novelty value but apparently had very limited features. As a promotion vehicle it created very good public relations and good will for CIBC. Roadside Assistance was an interesting tangible offering that differentiated the loan experience and added value for the customer. The Free Visa/Free Linkup added customer value and is an example of cross-selling. The “Credit Smart” booklet added customer value through knowledge. The Valued Customer Portfolio was a tangible initiative that was not well received by the branches and apparently added little value for the customer.
In summary, it is difficult to suggest a future course of action for Bankware II because its impact has not been evaluated. As well, it is difficult to design and implement promotion initiatives that satisfy all the criteria. Because CIBC has not measured the effectiveness of these initiatives, future plans are problematic. At a minimum, some attempt should have been made to at least determine the number of customers (new versus existing) that participated in each initiative.