FINANCIAL SERVICES:
A Business Turnaround

Client Situation

As a global financial services powerhouse, this client is active across a broad spectrum of financial products and services-Banking, Insurance, Credit Cards, Brokerage Services, and Travel Cards and Services, to name a few. While the client's position in the majority of its markets had been growing and contributing to healthy stock price appreciation, the client's once core and very profitable Travel Card business was in serious decline. Sales had been down 4 to 5% year over year for the previous five years, and frustrated senior management was ready to designate the business a 'harvest candidate'. But important questions remained: Was this really a dying business? Did profitable growth segments exist where the product was still relevant? Was the client targeting the most compelling consumer segments? Did the client understand the drivers and barriers to product usage?

Results

Market2Customer^® (M2C^®) work with the client resulted in a complete turnaround of the business. After several years of decline, our client experienced 10% growth in their Charge and Prepaid Travel Card business in the first year after implementation. As a result of our work, our client refocused its effort on an entirely new consumer segment and geography, created new relationships with non-traditional distribution channels, redirected 80% of its marketing and promotion budget for Travel Cards, and reorganized its Travel Card marketing department from a traditional product based organization to one built around specific customer and consumer segments.

The Intervention

M2C GrowthPath^® approach was the core driver of our client's success. Through a structured facilitation process and thoughtful primary research, the M2C team was able to identify a new consumer segmentation that captured the financial value of different consumer groups based on occasion-specific travel spending circumstances. M2C proprietary thinking around segmentation helped to refresh and reframe the market opportunities in a way the client had not seen before.

This led to a dramatic change in the choice of target consumer. While our client had traditionally focused on 55+ couples traveling domestically, our work demonstrated that value for this particular product resided in an altogether different segment: young, mid-income families traveling internationally.

Having identified the highest potential market segment, the team then sought to bring the consumer to life-to understand the buying process for travel cards and to identify the desired vs. actual experience when purchasing and using the product. By providing our clients with M2C's Customer Portrait^® services, the team reached some crucial conclusions. First, the primary competitive threat came from another product category and not another brand. Cash-not credit cards, as the client believed-was the primary competitor for this segment. Second, we found that this particular consumer segment made purchase decisions at channels where the client had a very limited presence and certainly no strategy. If the client was to grow, a clear strategy for these particular channels would be a necessity.

Out of knowledge came action. In conjunction with the client team, M2C developed a practical and targeted activation plan focused on getting the target segments to use our client's travel card instead of cash. The team also developed an action plan focused on creating 'marketing partnerships' for nontraditional channels. The client refocused marketing messages, refined ad spending, and rejuvenated the organization. Our client also developed plans to address other high value segments in a sequenced fashion over time. From the perspective of our client, the Travel Card Group went from "no growth to being featured as the 'poster child' for change for the entire corporation."

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