Bank of America 2001 Annual Report Download - page 18

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Most of the growth in these markets will come from three
groups – Hispanic, Asian and African American. Currently, 37%
of the population in our footprint is comprised of these three
groups, which are expected to account for 80% of the total popu-
lation growth in our footprint in the next 10 years. Together they
represent purchasing power estimated at $1 trillion a year. In
California, for example, almost 40% of households are Hispanic
and close to 38% of Hispanic households have mortgages.
However, while two-thirds of California Hispanic households with
banking relationships have their relationships with Bank of
America, fewer than 3% have mortgages with us. Increasing that
percentage just one point translates to 110,000 more mortgages.
To capture this growth, we are building a best-in-class
multicultural marketing strategy and focusing resources on
building brand awareness in these rapidly growing segments.
Retain. Key to customer satisfaction and retention is
providing a positive customer experience and outstanding
service. We are beginning to dramatically improve our service
and fulfillment processes across all delivery channels. In Atlanta,
banking center prototypes allow us to pilot creative new ways
to enhance the customer experience. They have become a vital
source of service innovation. The prototype banking centers
feature the latest in banking technology, providing a one-stop
shop where customers can find advice and solutions to help
meet their financial needs.
We’ve seized the opportunity to refine our customer
research to better understand and respond to our customers,
and use the information to make process improvements.
We’re also getting better at using customer information to
run predictive models, allowing us to reach out and retain
customers who might consider leaving.
It’s all part of our effort to improve sales and service.
For example, customers will benefit from a reduction in the
amount of time it takes to process card claims. Our cycle time
is
already an industry benchmark, but we intend to keep improv-
ing
it. We have already produced some wins for our customers.
Satisfaction scores among highly satisfied Consumer Banking
customers improved from 43% in 2000 to 49% in 2001.
there exists an ongoing opportunity to deepen relationships.
And we’re making progress. After several years of post-merger
declines, in 2001 we began to grow our base of checking
accounts. In turn, we have more opportunities to anticipate
and meet additional customer needs.
To increase awareness of the power and ingenuity of our
franchise and bring customers in the door, we’re using brand
advertising and targeted marketing programs. We’ve also
invested significantly and successfully in product campaigns to
attract customers in areas like credit card and online banking.
In 2001, the company added 3 million credit card accounts
and 1.1 million net new active online banking customers. We
plan to continue to retain and expand these relationships.
Furthermore, population demographics are changing rap-
idly and our franchise is geographically positioned to capture
multicultural growth. We are a leader in states with the largest
multicultural markets: California, Texas and Florida.
16
We’ve developed new tools to enable associates to get the right services to
customers at the right time. Higher satisfaction rates will be the key measure of
our success in serving consumers and growing revenue.
CUSTOMERS ARE BENEFITING from fast and convenient electronic
payments for credit cards, mortgages and loans. In 2001, more than
one half-million existing Bank of America customers who were making
payments by mail decided to take advantage of electronic payments.
Expanding electronic payment options for our customers is a
key to our strategy of increasing customer satisfaction in ways that
improve shareholder return. Satisfaction with payment processing
improves 19% among customers who pay electronically, and problems
with payments drop significantly. Here’s the bonus: The Bank of
America cost per payment transaction drops at least 69% when
customers pay electronically.
Each month, customers make more than 3.5 million electronic
payments to Bank of America. In 2001, we improved transaction
speed and accuracy and made available the electronic payment
option to more customers through more banking channels.
Improving
Electronic Payment
Options