Capital One Financial Corporation
The founders of Capital One Financial Corporation Richard Fairbank and Nigel Morris had turn “Signet” a minor credit card subsidiary of a small bank into the nation’s seventh largest credit card issuer with an excellent strategy as “The right product to the right customer at the right time for the right price.”
Fairbank and Morris started their way into credit card business with totally different view from others. They believe that credit cards are not banking, they are information. Fairbank and Morris realized that the risky of this business might be at the forefront of the whole technology revolution. They used the power of statistical analysis to formulate business in credit cards which they think it were “the most direct marketed product in the world.” Without having experience in a direct marketing project before; they were struck by six significant characteristics of such efforts: the ability to record every interaction with a customer, the ability to customize products to each customer, the ability to turn a scientific laboratory by using thousands of experiments, the ability to roll out products on a national scale at the full speed, the potential to reinvent the entire economics of a business and the last no other competitor seemed to recognize this. This is the starter of how they brought Capital one into the world of success. The two realized the important of using technology to collect all customer information to drive their business. They didn’t know about technology but they knew exactly what they need out of technology.
In the beginning when Fairbank and Morris join the Signet they learned that they need to take time to formulate their strategy. They realized that the organizations could find it difficult for rapid changes. Therefore, for their first experiment to roll out the new product they decided to use a combination of Signet’s traditional credit algorithm and their new model, the result was...