The projected opportunity was 1.3% uplift in assets retained (with no cost to margin) and 3.5 million in net interest income over the first year. The financial benefit realized actually exceeded projections:
Overall retention rate increased by 1.9%.
Average yield remains steady at less than 1 basis point below business as usual.
Average income increased by $5.1 million.
Operational benefits included: direct mail in specific segments increased retention significantly above plan, sales officers kept within pricing guidelines, and phasing of proactive contact heightened renewal activity during offer period.
Customer Perspective
Before Nomis, all of our renewal contact with our customers was basically regulatory driven. Nomis (helped us with) a much more disciplined contact strategy...What we needed was someone to apply some analytic discipline to our mortgage retention initiatives and to provide us with some assistance on which customers were most likely to attrite so we could focus our efforts on those customers. What it boiled down to was: what customers to contact, how to contact them, and what renewal rate we should be offering them.
At the same time, our pricing was entirely dependent on our sales officer's negotiation. With Nomis, what we were able to do was standardize our pricing and offer rates to our customers based primarily on their probability of attrition.
We actually not only met our business case objectives, we in fact exceeded them...while at the same time we were able to keep our margins stable.
Lezley Chafetz
Director, Product & Program Design, Scotiabank
