Case Study On Credit Card Revolutionary

1. Capital One Financial Corp. is an organization that deals with financial lending and has credit card products in the market, the competitors for this organization are basically any other credit card organization.
2. The strategy of growth for Capital One, was really great and the CEO Richard D. Fairbank had a very innovative approach towards this, when they initially started in 1991 they ensured that their products do not remain an identical copy of the other available products in the market, on one hand where the other companies were charging some 20 odd percent interest, and almost similar services, Fairbank came up with a very customized product and lot of choices, the interest rate was also very reasonable and was based on the risk assessment of the borrower.
3. Information management is the key strategy at Capital One, the organization believes in strict data orientation, there are various sources such as post office address files and credit checking agencies such as Equifax and Experian which provide data to Capital one., moreover products like gardening credit card help to target the database which tells about the people who may be interested in the product. The next step is to normalize the data using Trillium and finally it is sent to software vendors like SAS Institute and Brio for deep analysis., after which it is ready for use and gives the information about the associated risk and customer lending.
4. Capital One believes in the use of technology right from the core rather than building a business and then using technology to improve the same. The organization has built every aspect of operation based on technology, there is a very strong database maintenance structure, which is used to collect the data and then there is a very deep analysis of the data to calculate the risk in lending. Similarly the organization uses a tool to help it self with customer retention, and in case if the customer does not seem to be profitable the technology is used to decide whether to offer any good deal of just let the customer decide.
5. Capitol One was facing a challenge with customer retention and it was difficult to asses whether who should be retained and who should be allowed to go, Fairbank came up with a structured data analysis that helped to derive a system which was able to tell if the customer asking for a better offer should be given one, or considering their engagement history they should be denied for the same. This system was considered as “scientific test” and became a really handy strategy.