Magazine article American Banker

IBM Buying Data Analysis System for Target Marketing

Magazine article American Banker

IBM Buying Data Analysis System for Target Marketing

Article excerpt

International Business Machines Corp. is expected to announce today the acquisition of a target marketing software system from Customer Potential Management Corp.

The software, called Target, helps banks analyze customer data to market products and services.

Spokesmen for both companies declined to disclose the deal's value. But IBM officials said the software fits into their company's plan to shore up its roster of data mining and data warehousing services for financial companies.

According to Mentis Corp., a research firm based in Raleigh, N.C., only about 11% of banks have fully functional data warehouses, which are information repositories that form the foundation of many data mining applications.

That number, combined with the fact that data mining and target marketing are among the most talked-about subjects in banking, suggest a huge potential market for the software IBM has bought.

"To stay competitive, banks need to raise their wallet share," said William I. Levine, IBM vice president for banking, finance, and securities.

"Banks already know who you are," he said. "Now, they are going to market to you."

Two large banks already have agreed to use the software. Their contracts are worth $25 million combined, according to an IBM spokesman.

Another 12 financial institutions with assets ranging from $5 billion to $90 billion are considering purchases that could bring IBM an additional $75 million in revenue, the spokesman added.

"There are a lot of products that IBM will combine with this that will only make it better," said John N. …

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