ICICI Bank uses business intelligence and analytics for various internal and external processes. Internally, it uses techniques like customer profitability analysis and segmentation to identify profitable vs unprofitable customers. Externally, it uses credit card fraud detection analyzing spending patterns to detect fraudulent transactions. The bank analyzes customer data from transactions using tools like Excel, SPSS to generate insights and make recommendations like personalized offers, cross-selling, retention strategies to increase revenues and profitability.

1. SP Jain School of Global Management
BUSINESS INTELLIGENCE
AND ANALYTICS USED IN
ICICI BANK
Marketing Audit and Evaluation – Group Assignment
Group – 2:
Manish Barapatre
Neeharika Satyavada
Prajakta Talathi
Vikas Jamwal

2. Business Intelligence and Analytics used in ICICI Bank
1
Table of Contents
ICICI Bank.................................................................................................................. 2
Business Processes................................................................................................... 2
Internal.................................................................................................................... 2
External .................................................................................................................. 3
Customer Profitability and Segmentation ................................................................... 4
Competitive Advantage........................................................................................... 4
Metrics.................................................................................................................... 4
Data Sources.......................................................................................................... 4
Type of Data Required............................................................................................ 4
Techniques Used.................................................................................................... 4
Tools Used ............................................................................................................. 4
Credit Card Fraud Detection ...................................................................................... 5
Competitive Advantage........................................................................................... 5
Metrics.................................................................................................................... 5
Data Sources.......................................................................................................... 5
Type of Data Required............................................................................................ 5
Techniques Used.................................................................................................... 5
Tools Used ............................................................................................................. 5
Recommendation of Usage........................................................................................ 6
References................................................................................................................. 7

3. Business Intelligence and Analytics used in ICICI Bank
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ICICI Bank
ICICI Bank is India's largest private sector bank with total assets of Rs.5,946.42
billion (US$ 99 billion) and profit after tax at Rs.98.10 billion (US$ 1,637 million) for
the year ended March 31, 2014. It was originally promoted in 1994 by ICICI Limited,
an Indian financial institution as its wholly-owned subsidiary but subsequently ICICI's
shareholding in ICICI Bank was reduced to 46% through a public offering of shares
in India in fiscal 1998, an equity offering in the form of ADRs listed on the NYSE in
fiscal 2000, ICICI Bank's acquisition of Bank of Madura Limited in 2001 and
secondary market sales by ICICI to institutional investors in 2001 & 2002.
In October 2001, began the process of merger of ICICI and two of its wholly-owned
retail finance subsidiaries, ICICI Personal Financial Services Limited and ICICI
Capital Services Limited, with ICICI Bank. Consequent to the merger, the ICICI
group's financing and banking operations, both wholesale and retail, have been
integrated in a single entity.
The bank offers a wide range of banking products and financial services to corporate
and retail customers through a variety of delivery channels and through its group
companies. The Bank’s products include – savings accounts & deposits; loans for
personal use, home, cars, commercial vehicles & against gold or securities; credit,
debit & travel cards; general & life insurance, and demat accounts. It also offers
some investment products such as FD, Government & ICICI bonds, PPF, mutual
fund and gold/silver. In the process of delivering these products to its customers,
ICICI Bank offers the following services, besides the regular services offered at the
bank’s branches – online & mobile banking, ATMs, Pockets, ICICI Bank games and
Touch Banking through self-serviced automated devices.
ICICI Bank Ltd is looking at Business Intelligence and Analytics as a tool to generate
more revenue, as they get valuable insights on customers and markets.
Business Processes
Internal
 Enterprise Risk Management
Identifying particular events and assessing them in terms of likelihood and
magnitude of impact, determining a response strategy, and monitoring progress.
Competitive advantage – Risk reduction, proactive measure can be identified
 Customer Profitability Management
Identification of profitable and unprofitable customers; Qualification or restriction
from certain services
Competitive Advantage – Inputs for turning unprofitable to profitable, increase
profitability
 Product Performance Management
Monitoring profitability of a product and making decision to maintain, improve or
abandon it
Competitive Advantage – Avoid/reduce loss of revenues
 Customer Segmentation
Identifying group of clients composed based on specific shared characteristics
and needs
Competitive Advantage – Increased conversion by offering right clients

4. Business Intelligence and Analytics used in ICICI Bank
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External
 Customer Relationship Management
Regularly contacting customer and managing customer traction with the services
Competitive Advantage – Increased customer transaction, Increase in CLV
 Customer Complaint Resolution
Customer complaints over phone to call center or send e-mail; Call center
operator creates new complaint, enters summary and assigns compliant code.
The complaint follows a typical life cycle till it is closed.
Competitive Advantage – Inputs for product improvement, increase customer
satisfaction
 Cross Selling
Offering/selling another product to an existing customer
Competitive Advantage – Increase in profitability
 Marketing Campaign
In order to increase awareness banks arrange various marketing campaigns. The
process starts with deciding which type of campaign will effective based on
analysis of campaign in past
Competitive Advantage – increase awareness, deliver effective customers and
reach target market
 Credit Card Fraud Detection
A process of identifying the probability of fraudulent transaction
Competitive Advantage – lesser occurrence of fraud transactions, improves
credibility and reliability of the bank and minimise penalty

5. Business Intelligence and Analytics used in ICICI Bank
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Customer Profitability and Segmentation
An internal business process wherein banks at various levels are engaged with the
customers during the entire customer life cycle from acquisition to termination of the
relationship and this needs to done in such a way that only the profitable ones are
with you. Once the customer has been acquired using traditional and non-traditional
sources, the challenge is keeping them engaged and making them profitable. It is
true that 20% customers generate 80% profits. Customer segmentation is made to
distinguish profitable from non-profitable and use strategies to see that the bottom
line is enhanced.
Competitive Advantage
 Personalised offerings – understand behavioural economics and find ways to
gain higher wallet shares
 Cross-selling and Customer specific rewards – offers to attract and retain
customers
Metrics
 Customer Lifetime Value – CLV values customers on the basis of their expected
income-generating potential, as well as their past behavior
 ROI – returns on invested money per customer
 ROE – returns on equity per customer
Data Sources
 Customers Recency and Retention – count of customers new and old
 Transaction Frequency – how often transaction is performed
 Transaction Size – volume of transactions (deposit amount, loan amounts etc.)
Type of Data Required
 Consumer Behaviour – intentional action or passive behavior
 Customer Knowledge – customer behavior or direct customer input
 Customer Margins – cost incurred and revenues obtained from each customer
 Account Statement – transactions performed in an account
Techniques Used
 Activity Based Costing – estimates of the value that each customer and segment
provides to the company through normal purchasing and usage
 Calculation of statistical parameters – to identify outliers
 Classification – to find patterns amongst data elements
 OLAP – analysis of customer segments, their transactions and profitability
 Reporting – month-wise or quarter-wise etc.
 Forecasting – assess needs of segments and forecast their demands with
respect to offers, schemes or usage
Tools Used
Software such as CorePROFIT, Fidelity National Information Services, IPS-Sendero,
Oracle, ProfitStars, QRM, SAS, SunGard BancWare, and Teradata
Excel/ XLMiner, SPSS, etc

6. Business Intelligence and Analytics used in ICICI Bank
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Credit Card Fraud Detection
Fraud detection is an external business process used to identify any fraud
transactions that can take place with the customer’s credit cards.
Competitive Advantage
 Less number of fraud cases – lesser occurrence of fraud transactions, improves
credibility and reliability of the bank
 Minimise penalty – prevent penalties incurred due to fraudulent transactions
Metrics
 Success Ratio – Probability of successful detection of fraud
 Alarm Raised – Alarm raised for actual fraud
 Rate of decrease in fraudulent cases – number of fraudulency minimised
Data Sources
 Customers Recency and Retention – count of customers new and old
 Transaction Frequency – how often transaction is performed
 Transaction Size – volume of transactions (deposit amount, loan amounts etc.)
Type of Data Required
 Spending Pattern – pattern recognition e.g. buying behaviour, location, etc.
 Customer Knowledge –direct customer input
 Account Statement –past and recent transactions performed using the card
Techniques Used
 Calculation of statistical parameters – identify outliers that could indicate fraud
 Classification –find patterns amongst data elements
 Stratification of numbers – identify unusual entries
 Digital analysis – identify unexpected occurrences of digits in data sets
 Joining different diverse sources – to identify matching values (such as names,
addresses, and account numbers) where they shouldn’t exist
 Duplicate testing – identify duplicate transactions such as payments, claims, or
expense report items
 Gap testing – identify missing values in sequential data where it shouldn’t be
 Summing of numeric values – identify control totals that may have been falsified
 Validating entry dates – identify suspicious or inappropriate times for postings or
data entry
 OLAP – identify customer profile and their spending pattern
 Data Mining – extract structured information from card transactions
Tools Used
Siebel CRM, Excel/ XLMiner, SPSS, etc

7. Business Intelligence and Analytics used in ICICI Bank
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Recommendation of Usage
 Personalised offerings – understand behavioural economics and find ways to
gain higher wallet shares. Such as if customer is exhausting its credit card limit
bank can offer them an upgrade for little extra service charge.
 Cross-selling and Customer specific rewards – on the basis of market basket
analysis bank personnel can advise other products and services while customer
is looking particular product or service.
o If a customer is taking home loan they might use a credit card as well as
shown by association rules in market basket analysis.
o Another example would be, if a customer is using a trading account to buy
some stable blue chip shares, they can be offered specific hedge funds.
o Customer bounces check for the third time in one year. Similar customers
adopt overdraft protection. Bank can offer overdraft protection.
 Customer spend analysis – analyse the spend trend of customers and predict
their behaviour. This can help in identifying fraudulent transactions. E.g. if a large
transaction is occurring in a different geography whereas the customer has spent
has never spent may be classified as fraud and customer can be indicated about
such transaction.
 Retention Management – understand the customer psychology, segment etc.
and develop strategies for retention plan such as getting in touch with customer
and providing promotional offers.
 Customer Targeting Strategies: OLAP methods can be used to generate various
kinds of reports based on past data. For example identify how well received
different customer segments have been for a service and decide on next
targeting strategy.

8. Business Intelligence and Analytics used in ICICI Bank
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References
http://www.mckinsey.com/insights/business_technology/how_advanced_analytics_ar
e_redefining_banking
http://customerthink.com/segmentation_timing_products_services_customer_profitab
ility/
http://www.journalofaccountancy.com/Issues/2008/Dec/ManagingCustomerProfitabili
ty.htm
http://www.oracle.com/us/industries/financial-services/045613.pdf
http://www.ibmbigdatahub.com/blog/analytics-banking-services