Evaluation Of Hsbc Marketing Strategies

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EVALUATING Headquartered in London, HSBC Holdings is one of the largest banking and financial services organizations in the world. The HSBC Group has more than 9,700 offices in 77 countries. HSBC Bank plc is the U.K. member of the HSBC banking group. Its card services division manages the credit card products. The card services analysis unit uses SPSS software for marketing campaign evaluation and customer segmentation strategies. About 125 million credit card transactions are made each year by HSBC Bank cardholders. Each transaction carries an income fee payable by the receiving bank to the cardholder’s bank. The rules on fee rates applied are somewhat complex. A further complicating factor is that banks processing the transactions from the retailers may use different processing systems. But the challenge is the credit card market is one of the most volatile banking product markets in the U.K., due in part to an influx of new entrants over the past five years. These range from single product suppliers looking to extend their market to vertical industries diversifying their product range. Barriers to entry are relatively low, so the credit card tends to be used as a “foot-in-the-door” product. This has increased the need for traditional U.K. credit card issuers such as HSBC to develop appropriate retention and income generation strategies. Bob Howlett, manager of business analysis, card services, HSBC Bank plc, explains, “We believed that incorrect fees were being received for some transactions. Our task was to verify this and also set up a process which would ensure that the correct transaction fee was being applied on all transactions.” HSBC Bank plc decided to evaluate SPSS after internal software and basic database software had proved ineffectual. As a result of extensive experience in handling large volumes of data, a member of the card

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