1. EMM Credit Card
Segmentation Study
2007 - 2008
© 2008 EMM Group

2. Executive Summary
Using Segmentation to Drive Organic Growth
EMM group applied its proprietary segmentation technique,
‘segmenting the market of tomorrow’ to a premium credit card.
A new attractive needs-based segment, the confident entrepreneur,
was identified and targeted with a Gold & More card.
Insights about the target were developed and a new value proposition
crafted. A new service package was created to meet the functional
and emotional needs of the segment.
Within a period of 6 months, we achieved:
An increase in portfolio share of premium cards from 8% to 51%.
A 36% incremental increase in spends per active account.
An 8% incremental increase in Actives rate.
Actionable segmentation drove organic growth!
© 2008 EMM Group. Strictly Confidential Material.
2

3. EMM Group Case Study
Bank X Premium Card Project – Background
Card Issuer 's Strengths & Weaknesses
Strengths Weaknesses
78% unaided awareness. Bank X Premium Card owner
older, with a lower income and
“Trustworthiness” of Card Issuer less frequent usage.
mother brand.
Limited appeal to the younger
Rated as Best Customer Service and more affluent.
provider in card market.
Objectives
Increase portfolio share of premium cards from 10% to 40%.
Increase spend/active account by 10%.
Increase active cards as a % of total outstanding cards by 2%.
© 2008 EMM Group. Strictly Confidential Material.
3

4. EMM Group Case Study
We got some significant A-Ha’s from research
Business Assumptions Insights from Research
We did not know the brand’s Now we know that the brand
utility in driving consumer name adds the highest utility.
preference. Credit limit is an important
High credit limit is not one of the attribute for new customers.
most important product Prospects are seeking
attributes for new customers. transparency of charges / fees,
Unsure of Bank X Premium and Bank X Premium Card is
Card’s appeal among perceived to deliver on these.
prospects. The Bank X Premium Card is
Competitive Card has an preferred.among the ‘revolver’
advantage over Bank X segment.
Premium Card due to mother Segmentation shows that Card
brand image of Competitive Issuer is competitive in the
Bank in all customer segments. affluent segments and that we
can effectively target them with
Card Issuer can’t compete in the an enhanced value proposition.
premium segments given its low
appeal to affluent customers.
© 2008 EMM Group. Strictly Confidential Material.
4

5. EMM Group Case Study
We identified four ‘needs-based’ segments
We chose this target segment
Segment 1 based on segment
attractiveness and our ability to
compete.
Segment 2 –
Confident
Entrepreneur
Segment 4
Segment 3
Status Maintaining the
Family focused, Lives life to the maximum. conscious, standard of
wants to lead a Secure life Socially very active contemporary living. Providing
urban male for family
© 2008 EMM Group. Strictly Confidential Material.
5

6. EMM Group Case Study
We profiled the ‘Confident Entrepreneur’ segment
Usage Indices:
Revolver Index = 140
Multi Card Index = 122
He’s a street smart businessman, like a small scale builder or second hand
car dealer. He enjoys maximizing his profit.
He could be paying rent for a small office. He believes in living for the
moment and does not care about the future.
Though he believes in living big and drives a car, he keeps avoiding his
creditors. He likes flashy things and would take loans for something like a
bigger television. Likes to build contacts and enjoys throwing flashy parties
for his friends.
He would take a loan against properties to invest in his business, provided
the invested amount is safe.
Would love to take his family for an overseas vacation.
© 2008 EMM Group. Strictly Confidential Material.
6

7. EMM Group Case Study
We understood the drivers of the target segment
Hierarchy of Needs:
Confident Entrepreneur
Terminal Values
Freedom
Feel
Emotional Benefits unrestrained,
earn respect
Easy credit
Functional Benefits
Transparency,
high spending power
Accurate billing statement, Fair
Features & Attributes price/rate, high credit limit, credit
payment quickly
Credit card selection and usage reflects the ultimate goal:
Live Large and In the Moment
© 2008 EMM Group. Strictly Confidential Material.
7

8. EMM Group Case Study
We identified relevant improvement opportunities
Bank X
Segment characteristics Bank X Premium Card Premium Card
Versus Market
Perceived quality high among prospects
High multi-carding and weak among owners.
Brand Equity Good fit with Card
Issuer brand (PQI)
Product/service not meeting expectations. ►
Competition offering assured cash back.
High spends Revolver
Credit Limit
needs higher credit limit
Competition offering high credit limit and
better card type. ▼
High penetration in
Accessibility
self-employed
Current sale force has access to this
segment for new acquisitions. ►
Rewards High spends High utility of cash back. Competition
already offering cash back. ▼
Pricing Looks for fair pricing Pricing similar to other players. ►
▲ Above Par ► At Par ▼ Below Par
© 2008 EMM Group. Strictly Confidential Material.
8

9. EMM Group Case Study
The value proposition met target segment needs
Confident Entrepreneur Value Proposition – Gold & More Card
Target Progressive, confident entrepreneur
Core need Who wants to feel free and unrestrained
Offering Name The Bank X “Gold & More” Card
Frame of Reference Is a convenient payment mechanism
Benefits That provides him instant gratification and freedom
Point of Difference With his first premium card, offering “Assured Cash Back”
Because only Bank X “Gold & More” Card offers -
•Assured cash-back on regular spends like fuel, groceries,
Support departmental stores, restaurants & utility payments.
•With no conditions of minimum monthly spends or ticket size.
•Convenient automatic credit of the cash-back.
© 2008 EMM Group. Strictly Confidential Material.
9

10. The Results
© 2008 EMM Group. Strictly Confidential Material.

11. EMM Group Case Study
KPI 1: We grew portfolio share of Premium cards
Goal: Increase portfolio share of premium cards from 10% to 50%
Percentage
(Premium Products/
Total Accounts)
60%
45%
30%
15%
0%
8/7/07 9/7/07 10/7/07 11/7/07 12/7/07 1/8/08 2/8/08
Percentage (Premium Products/Total Accounts)
Share of Premium Cards in Total portfolio = 51% in 6 months
© 2008 EMM Group. Strictly Confidential Material.
11

12. EMM Group Case Study
KPI 2: We achieved Higher Spends per Active Account
Goal: 10% incremental spends per Active Account for new product
↑ 36%
Previous card
Gold & More
↑ 72%
Gold & More 8,753 3,129
Previous Card 6,423 1,820
Incremental Spends per Active Account = 36%
© 2008 EMM Group. Strictly Confidential Material.
12

13. EMM Group Case Study
KPI 3: We increased actives rate
Goal: 2% Incremental actives rate for new products vs. old products
Actives Rate – Gold & More
Incremental Active Incremental Active
Rate ~ 9% Rate 8%
Previous Card
Gold & More
Incremental Actives Rate > 8% versus target of 2%
© 2008 EMM Group. Strictly Confidential Material.
13

14. Summary and Conclusion
Using Needs based segmentation enabled the discovery of a
valuable segment…The Confident Entrepreneur.
Aligning the benefits of the new Gold & More card with the
functional and emotional needs of that segment drove positive
results. The card is positioned for strong growth.
Every major objective was exceeded within 6 months:
Grew portfolio share of premium cards from 8% to 51%.
Achieved 36% incremental spend per active account.
Increased Actives rate by over 8%.
Actionable segmentation drove organic growth!
© 2008 EMM Group. Strictly Confidential Material.
14