Actionable Insights From APT's Retail Practice

APT Chairman Co-Authors Harvard Business Review Article

December 15th, 2014 | Posted by JDouglass in Financial Services - (Comments Off on APT Chairman Co-Authors Harvard Business Review Article)

APT Co-Founder and Chairman, Jim Manzi, recently co-authored a Harvard Business Review article with HBS Professor Stefan Thomke about how experimentation can help companies de-risk new ideas and drive innovation.

A key point that the article makes is that testing can be an agent for meaningful organizational change, rather than simply a new analytical tactic: “The lesson is not merely that business experimentation can lead to better ways of doing things. It can also give companies the confidence to overturn wrongheaded conventional wisdom and the faulty business intuition that even seasoned executives can display. And smarter decision making ultimately leads to improved performance.”

Click here to download a full copy of the article.

Banks Think Bigger than Free Toasters

September 17th, 2014 | Posted by JDouglass in Financial Services | Uncategorized - (Comments Off on Banks Think Bigger than Free Toasters)

As competition closes in on all sides for retail banks (e.g., growth of online-only providers, new mobile players, brand consolidation, and more), organizations are doing all they can to bring in deposits. Adding to the pressure, rates are expected to rise fairly soon, which makes it essential for banks to acquire new accounts now. Just like community banks of generations past, financial institutions today are enticing customers with incentives and “freebies” to spur new account generation. However, this isn’t your mother’s free toaster! Today’s marketers are offering cold, hard cash to customers who meet certain requirements. This raises the essential question for bank executives: is this all worthwhile in the end? Are we needlessly spending hundreds of dollars per customer to increase new account generation? How can we know the exact payoff of such offers, and what can we do to make these programs as profitable as possible?


Unique Challenges Facing European Companies

July 2nd, 2014 | Posted by JDouglass in Financial Services - (Comments Off on Unique Challenges Facing European Companies)

APT SVP and Head of Europe Luca Zuccoli recently discussed some unique challenges facing European companies today, and what they can do to address these challenges.

APT & The Economist Release Joint Report About Decision-Making

June 2nd, 2014 | Posted by Jatin Atre in Financial Services - (Comments Off on APT & The Economist Release Joint Report About Decision-Making)

To “decide” can be interpreted as “picking one option and killing off all others.” In business, doing this right has large rewards, and getting it wrong has severe consequences. While executives have always made decisions, increasing amounts of data,  sophisticated consumers, rapidly evolving technology, and disruptive competitors, are fundamentally changing the art and science of decision-making.

APT partnered with the Economist Intelligence Unit to study how decision-making is rapidly evolving across various industries and geographies. The resulting report addresses tough and important questions, such as:

(1) How do executives blend intuition with data? Are companies allowing executives to trust intuition?

(2) How are executives using data in decision-making when the data is counter-intuitive to their beliefs?

(3) With so much data available, which data should executives consider? And, how should they best incorporate it in decision-making?

The report will be released on June 5th in London. Please email info[at] to be the first to get a complimentary copy of this actionable report written by the Economist Intelligence Unit.

City Branch Revolution

May 27th, 2014 | Posted by JDouglass in Financial Services | Uncategorized - (Comments Off on City Branch Revolution)

With the influx of technology solutions in retail banking, which includes ATM upgrades that enable more types of transactions, mobile solutions, and internet banking, banks are seeking to change branch models in high-traffic urban areas.

Similar trends have already been a focus for retailers and restaurants where there is a shift towards opening smaller, but more technology-based, stores in the past few years. Mary Wisniewski speaks to this trend in an American Banker article, which discusses how Wells Fargo has recently opened urban branches in densely populated, urban areas, such as the U Street corridor of Washington, D.C. In doing this, Well Fargo aims to target customers who are comfortable using technology and who prefer their branches to be within walking distances to either their home or work. In addition to these changes reflecting customer demand and behavior, she notes that the cost savings are a huge bonus: “Because they are significantly smaller than a typical branch, they are also helping Wells to reduce branch overhead at a time when branch traffic continues to decline.”


Banking Strategies: Analytics for Commercial Banking

May 13th, 2014 | Posted by JDouglass in Financial Services | Uncategorized - (Comments Off on Banking Strategies: Analytics for Commercial Banking)

An article by APT SVP Will Weidman about best practices for commercial banking analytics was recently published in BAI’s Banking Analytics. In the article, Weidman discusses various functional areas in which commercial banks can improve profitability by testing new ideas and optimizing existing activities. Some areas include lead generation and banker outreach, training programs, and banker specialization. Weidman comments, “The huge opportunity stems from the large and specialized salesforce, who are highly skilled and represent the key to driving success in commercial banking. Analytics can help make sure these critical employees receive the tools they need and that the institution gets the most out of its salesforce. Banks should aim to learn more about what is currently working well in commercial banking to better prioritize banker activities going forward and become more disciplined with future investments in training programs and staffing.”

Please click here to read the full article, and learn more about APT’s experience in employee-based tests.

APT VP Rupert Naylor Featured in Financial Times

April 23rd, 2014 | Posted by JDouglass in Financial Services | Uncategorized - (Comments Off on APT VP Rupert Naylor Featured in Financial Times)

Commentary from APT Vice President Rupert Naylor was recently featured in the Financial Times in response to Sir Tim Harford’s article, “Big Mistake.” In the article, Harford argues that too many Big Data advocates care about “correlation rather than causation.” Naylor agrees this issue is problematic and offers a solution, suggesting that test and learn analytics can bridge this disconnect by driving to cause-and-effect relationships. Click here to read the full commentary.

Making the Switch: UK Legislation Makes it Easier to Move Between Banks

January 20th, 2014 | Posted by JDouglass in Financial Services - (Comments Off on Making the Switch: UK Legislation Makes it Easier to Move Between Banks)

In a move to make it easier for consumers to switch banks and to increase competition in the banking industry, the Payments Council of the UK has rolled out a “current account switch service” to speed up the process. The service will switch a consumer’s current account to a new bank within 7 days by transferring funds between banks, moving all standing direct debits to the new bank, and automatically redirecting any payments accidentally made from the old account to the new account for 13 months. While participating in the service is not mandated by law, 33 institutions have already enrolled.

Many banks have been using the service as an opportunity to increase their current account market share. This is creating an incentive war among UK banks, both large and small: for example, First Direct is offering £100 to customers who switch from another bank and another £100 if they aren’t satisfied within the first 12 months. Nationwide is offering 5% interest on their FlexDirect account for the first 12 months, and Santander is offering 4 free months of Arranged Overdraft for switching customers. (more…)

Banking Strategies: Top 5 Retail Banking Trends for 2014

December 18th, 2013 | Posted by JDouglass in Financial Services | Uncategorized - (Comments Off on Banking Strategies: Top 5 Retail Banking Trends for 2014)

APT SVP Will Weidman’s article about the top five retail banking trends for 2014 was recently featured in Banking Strategies. Trends for the new year include more targeted advertising and the bifurcation of the branch. Click here to read more.

Banks Charge for Branching Out

November 25th, 2013 | Posted by JDouglass in Financial Services | Uncategorized - (Comments Off on Banks Charge for Branching Out)

In the constant struggle to figure out how to successfully charge fees, some banks are now charging customers for using the branch. A recent article by CNBC cited multiple cases in which banks are introducing accounts for customers who plan to bank mostly through online, mobile, and ATM channels. However, if the customer wishes to bank in the branch, he may face a sizable fee: $8.95/month in the case of Bank of America’s “eBanking” account mentioned in the article.

As we’ve seen with many other banking fee innovations, charging for branch services bears risk. Bank of America recently folded their eBanking account offering after three years, a spokesperson acknowledging that “Customers want full service banking, even if they only visit a teller infrequently.” This action further underscores a trend that we’ve seen before:  fees will likely be much less successful if they are tacked onto a product or service that customers are accustomed to receiving for free. In many cases, it may simply be too difficult to get around the customer’s disposition against fees for products/services that were historically free.  Alternatively, banks may be more successful in charging fees for new or expedited services, such as fraud monitoring and faster mobile check deposit availability.

So how can banks determine which fees are profitable? Neil Weinberg, editor of American Banker suggested, “What is a premium service that they’re willing to see fees from? That’s the experimentation.” Experimentation is indeed the way APT has helped many banks understand the profitability of new fees. Banks should test new fees in a few markets or branches to measure the impact on key performance metrics and decide whether broader rollout is warranted. Click here to read more about APT’s work analyzing in-market tests at leading financial institutions.