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CRM for financial services quiz answers

Looking for answers to's quiz on financial services? Read the answers plus detailed information from our most popular news articles on industry-specific CRM here.

 1) The correct answer is B.
In a recent article, contributor Sue Hildreth reported that consolidation in the financial services industry is forcing organizations to integrate or replace legacy systems and spurring the increase in CRM spending. In the article, she pointed out that increased government and industry regulation is also forcing lenders to standardize customer processes and institute more comprehensive audit trails.

"The need to develop better service and sales processes is another major factor motivating lenders to invest more in CRM, as they seek to improve long-term customer loyalty and to sell more financial products and services.

'A bank that has a customer with a mortgage, checking account, savings and investments wants to be able to see them all together but also to value them together and market appropriately,' said Mary Pilecki, senior analyst at Forrester Research, noting that it is a trend she sees in many types of financial services firms, from banking to insurance. "

For more information, read Sue Hildreth's piece: CRM: Financial services firms take a fresh look.

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2) The correct answer is A.
True. A September 2006 survey by Forrester Research found that 21% of companies planned to make a first-time CRM purchase in 2007, while 90% would be investing in a minor upgrade, and 35% in a major upgrade.

For more information, read this news article on CRM for financial services

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3) The correct answer is A.
True. A article outlined how Wachovia Corp. is now embarking on a initiative to define and promote customer equity.

"'Consulting companies are saying you should be interested in customer lifetime value, and they'll give you an average value for those customers,' said Dan Thorpe, senior vice president, and statistics and modeling director of Wachovia's Customer Analysis Research and Targeting (CART) Group. 'We are calculating individual estimates for each of our households. We really think households drive customer value.'

That's no small task. Wachovia has more than 13 million customers and breaking them down into households requires understanding the relationships within a household, which may include more than just checking accounts and mortgages for a husband and wife, but a brother or sister and a business as well. A household may have a checking account and a credit card with Wachovia and may be a candidate for a home equity loan. But instead of considering just the value of the one loan, Wachovia will be able to see how that loan offer will affect all the products the customer might be eligible for now and in the future. "

Learn more about customer equity and customer life cycle in this definition from

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4) The correct answer is B.

In a report for, John Gaffney of the Peppers & Rogers Group reported that financial institutions are indeed banking on fees.

"According to a 2004 report from the Federal Reserve, income from non-interest revenue streams now provides nearly half of all operating income generated by U.S. commercial banks. Non-interest revenues basically are fees," wrote John Gaffney in a report for

"They come from checking accounts, ATMs, savings accounts, and credit card accounts. Fee income has more than doubled as a share of commercial bank operating income since the early 1980s."

Read more in this news article: Banks trading fees for loyalty.

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5) The correct answer is A.
True. According to John Gaffney of the Peppers & Rogers Group, recent marketing campaigns from TD Waterhouse and WashingtonMutual focus on the fact that these financial institutions are not charging ATM withdrawal fees.

"Those fees may be affecting how customers perceive their banks, and generally, that perception is not good. A recent Forrester Research study on customer advocacy found that the biggest retail banks have subpar customer advocacy ratings. When the research firm asked more than 60,000 customers if they believed 'their bank acted with their best interest in mind,' Citibank and JP Morgan Chase received positive responses from less than 20% of their customers. The highest rated retail bank was Wachovia at 40%. In a separate study, Forrester found that 65% of all customers who had been hit for an overdraft fee at any point during their tenure with their bank had a negative view of their bank."

Learn more about how fees impact customer loyalty in Banks trading fees for loyalty.

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6) The correct answer is B.
A financial data management tool -- like Hyperion System 9 Financial Data Management -- manages financial data collection and validation processes. It has workflow management and data quality features to assist with collecting, mapping, moving, validating and reporting on financial data. With the tool, users can view an audit trail showing the history of each data point, including transformations and validation all the way back to the data source.

Read more in this news article from
Financial data management tool eases compliance pain.

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7) The correct answer is D.
The path toward vertical functionality for CRM is a familiar one for SAP, PeopleSoft, Siebel and Oracle. Yet, according to Sheryl Kingstone, analyst with Boston-based Yankee Group, there are simply never enough industry-specific processes.

"We've never, from a CRM perspective, done that great when you're talking about verticals," said Kingstone in a recent interview with "Even businesses within a vertical still have specific business process. It's usually only getting you 50% of the way."

Learn more about vertical CRM in SaaS CRM software takes vertical approach.

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8) The correct answer is A.
A news article -- Oracle and SAP's vertical CRM battle a narrow one -- shed some light on which industries are deploying which CRM applications. According to a Gartner study, Siebel tends to have a hold with pharmaceutical and medicine services providers and some financial services like insurance, while SAP is stronger in manufacturing and some utilities.

Learn more about vertical CRM from SAP and Oracle in this news article.

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9) The correct answer is C.
In February 2007, announced its Wealth Management edition, the company's first industry-specific application.

According to an article on, Merrill Lynch selected the Wealth Management edition as the standard for its financial advisors after running a one-year pilot with 5,000 subscribers. It recently announced it is expanding that number to 25,000 users, becoming's largest customer.

Read more about in this news article: makes financial services push.

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10) The correct answer is A.
CDC Software Corp., which acquired Pivotal in 2004, acquired Respond Group Ltd., a European provider of customer feedback software, in February 2007.

U.K.-based Respond serves 800 customers, primarily in the financial services industry, including AXA Insurance and Barclays. According to a news article, Respond will provide opportunities to cross-sell and up-sell CDC's Pivotal CRM application to its existing financial services customer base. Respond also maintains a footprint in government organizations. The acquisition is a way for CDC to build out its industry-specific capabilities with its more than 5,000 customers.

Learn more in this news article: CRM -- CDC adds customer feedback

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