A CRM System can help with privacy management. (Marketing News).

Got your privacy management problems under control yet? Do your customers know what your policies are? Have they begun to rebel at the number of disclosure notices they've received? Are they reading your disclosure notices or throwing them in the trash?

If privacy management is still a concern, Ginger Gagen has a suggestion: CRM.

As the deadline approached last July for distributing privacy-disclosure notices, consumers and consumer organizations grew increasingly critical of the methods most banks used to disseminate policy information, Gagen says. In the process of informing customers about the "opt-out" nature of these policies, she says, "something went wrong."

"It should have been straightforward and easy for consumers to exercise their rights under the law," she says. "However, a recent survey conducted by the American Bankers Association shows that only 36 percent of respondents said they had read their banks' privacy notices. Another 22 percent said they received the notice but did not read it, and 41 percent could not remember receiving it at all. More astonishing-only 5 percent of the people receiving the notices have opted out by returning the forms."

Gagen, a CRM specialist with Sedona Corp., King of Prussia, Pa., says banks could improve customers' comprehension (and response) by making use of a CRM system. Better yet, with a CRM system, banks could reduce their costs of ensuring compliance.

By shifting your reliance on envelope stuffers to individual, personalized first-class letters-something a CRM system makes more convenient-you can raise the visibility of your notices and reduce the number of mailings that are required, she says. For example, a community bank with 50,000 customers and 100,000 accounts might spend $100,000 on envelope stuffers at an average cost of $1 each. A separate first-class mailing, managed through CRM software, would cost $67,500, since you'd only have to send a single notice to each customer rather than a notice to each account. If your bank is bigger than that, the savings would be even greater.

With a CRM system, a bank can track mailings to determine how recently particular customers lost received privacy disclosure notices, Gagen says. "Using CRM technology to comply with regulatory requirements can give financial services providers the opportunity to move from being merely concerned about compliance to becoming an aggressive consumer advocate and building competitive advantage on that differentiator."