Compilation of presentations made by Sicredi CMO Daniel Ferretti on WOCCU (World Council of Credit Unions) events in Denver, Washington and Colombia in 2015, regarding the importance of branding and omnichannel strategy to face the fintech revolution on retail banking

1. Leveraging brand and an
omnichannel platform to
face the fintech challenge in
retail banking
Daniel Ferretti
CMO & Online Channels - Sicredi

2. Quick overview: Brazil at a glance
• 8th largest economyintheworld($1.9triGDP/$3,6triPPP);
• Largest economy inLatinAmerica;
• Totalpopulation204million(112laborforce);
• 108millionpeoplehave bankaccounts (60%-US71%);
• Amidst economic downturn( 2,97%fcstGDPin2015);
• Politicalcrisis duetocorruption charges (approval is9%).
Estaiada bridge in São Paulo Beach in Rio de Janeiro Agribusiness in the Midwest

3. Quick overview: Banks and Credit Unions in Brazil
• 4majorbanksaccountablefor60%oftotalassets($1,8tri)
• 2aregovernmentbanks(1st BancodoBrasiland3rd Caixa)
• BancoItaúnetprofitin2014wasover$5billion
• Highspendinginadvertisingandtechnology
• Highmergerandacquisitionactivityinthelast10years
• Primaryobjectiveisprofitforasmallgroupofshareholders
• 1.200creditunionscovering100%ofterritory
• Serving7millionmembers
• Accountablefor3%marketshareonassets
• 5thlargestbranchnetworkcombined(18%oftotal5.300)
• 2largesystemsaccountfor78%(SicrediandSicoob)
• Primaryobjectiveiscustomersatisfaction
BANKS
CREDIT
UNIONS

4. “People who cooperate grow“
Administrative and operations office in Porto Alegre, RS
Quick overview: Sicredi
• 96creditunionsoperating underasinglebrand
• 3millionmembers
• 1.370 branches in11states
• 18.000 employees
• US$18biinassets
• Centralized datacenter, operations andproducts
Inside Guaravera BranchJaniópolis Branch São Mateus do Sul Branch

5. 1.300
Branches
(UAs)
4 Centrais (Regional Offices)
• Porto Alegre, RS
• Curitiba, PR
• Goiás, GO
• Cuiabá, MT
Centro Administrativo (CAS)
Porto Alegre, RS
 Cooperative Bank
 Cards Issuer
 Insurance Broker
 Consortium Administration
 IT
 Risk
 Finance
 Marketing
96 Credit Unions
• 11 states
Members
(“owners”)
Business Model: member ownedcredit unions withcentralized service sharing

6. Marketing structure, volume and support network
Marketing
CENTRAL
MT/PA/RO
CENTRAL
BRC
CENTRAL
PR/SP/RJ
CENTRAL
SUL
P&S
FOUND.
BIZ
UNITS
CREDIT
CEO
HR
PRESS
COOPS
EMPLOYEE
MEMBERS
COORD.
NÚCLEO
FULL
AGENCY
COOP
HOUSE
ENDO
BTL
DIGITAL
PR
VP
P&S
672
514
211
172
1.569
377
187
146
28
72
266
4.571
# VOLUME MATERIALS
BRIEF SOURCE
TARGET AUDIENCE
AGENCY
8 MANAGERS
26 FTE
• 26FTEs
• 8Managers (1CMO,2senior)
• 1FullAdAgency
• 1PRAgency
• 1BTL&Direct MarketingAgency
• 1DigitalAgency
• 1Internal CommunicationsAgency
• 8.785 promomaterials /month
• 48largecampaigns /year
• Totalexpenditure R$100MM/year

7. Brand performance 2013 to 2015
• Highestgrowthofbrand
awarenessamongallfinancial
institutions(89%)
• 3rd rankedininductedbrand
recall
• 4th rankedinspontaneousin
brandrecall
• Expenditureis1/12compared
totop3playersaverage

8. Offer strategy according to member life cycle
RELATIONSHIP
ACTIVATION
ACCOUNT OPPENING
PROSPECTING
RECOVERY
RETENTION
MEMBERS
UP SELL
CROSS SELL
DEEP SELL
REASON
EMOTION
BRAND
PRODUCT

9. GenYLifecycle:thesnoozegeneration
Infant&Children
0-5 y.o.
Adolescence
6-12 y.o.
Teenagers
13-19 y.o.
YoungAdults
20-30 y.o.
Adulthood
31-60 y.o.
Maturity
61+ y.o.
GENERATION Y
15 35
SCHOOL
HIGH
SCHOOL
COLLEGE MBA
MARRIEDLIVING WITH FAMILY
WORK RETIRED
HOUSECAR
EDUCATION OCCUPATION SOCIAL LIFEASSETS

10. Technology,alongsidewithmarketchanges,transformedmediainaprofoundway
1950to1980–“BroadcastEra” 1980to2000–“ClutterEra” 2000to...–“NetworkEra”

11. GenYMediaHabits:Alwayson,butswitchingfocusonwhat´srelevant
OPEN / CABLE TV
INTERNET PC
MOBILE
ON DEMAND
GAMES / OCN*
86%
81%
42%
38%
37%
Dailyusage% FavoriteChannel/Content
1. Movies (72%)
2. Soap Opera (44%)
3. Series (36%)
4. News (26%)
1. Social Networking (74%)
2. Browse Internet (12%)
3. Games (6%)
4. E-mails (3%)
1. Social Networking (71%)
2. Games (8%)
3. Research (5%)
4. E-mails (4%)
1. Action Games (42%)
2. Sports Games (33%)
3. Sim Games (21%)
4. Others (4%)
1. YouTube (89%)
2. Netflix (41%)
3. Apple TV (14%)
4. Others (31%)
PerceptionofAdvertisement
Dislike 47%
Like 52%
Dislike 63%
Like 37%
Dislike 56%
Like 44%
Dislike 72%
Like 28%
Dislike 67%
Like 33%
OverallPerception
• Leaves TV on while doing
something else
• Seeks entertainment, even
on the commercial breaks
• Constant use
• SMS or “unwanted”
advertising seems to invade
privacy
• Uses it mostly to work /
study
• Don´t like banner ads
• Likes retargeting
• 39% plays online
• Is open to advertising, but it
must be “clever”
• Since it´s a payed service,
won’t stand advertising
• 67% skip YouTube intro
advertisement
Media

12. Thewaycompaniesmarkettheirproductschangedtoadapttoaneweconomy
COMPANY A
COMPANY B
COMPANY C
COMPANY D
COMPANY
E
1950to1980–“BroadcastEra”
COMPANY A
COMPANY B
COMPANY C
COMPANY D
COMPANY
E
COMPANY
F
COMPANY
H
COMP. E
COMP. E
COMP. G
1980to2000–“ClutterEra”
COMPANY B
COMPANY C
COMPANY D
COMPANY
E
COMPANY
F
COMPANY
H
COMP. E
COMP. E
COMP. G
COMPANY A
COMP.
J
COMPANY J
2000to...–“NetworkEra”
SIZE EXPERTISE VALUES
TOBEKNOWN TOBERECOGNIZED TOBERELEVANT
MARKET ENVIRONMENT
Verysynergictocreditunion
valueproposition

13. Newwaystopromotebrandsandproductsdefytheadvertisingstatusquo
PRODUCT PLACEMENT BRANDED CONTENT PARODY CAUSE LED
CastAway
FEDexandWilson
Thebreadyinside
IntelandDell
IntroducingtheBookBook
IkeaCatalog
#LikeAGirl
Always
• Productorbrandaspartofcontext
• Emotionalbondthroughcontent
• Celebrityendorsement
• Lowcontrolofthemessage
• Contentisking(productionquality)
• Product/Brandcrosscontent
• Lowvisibilitysometimes
• Dependonwideandmassiveimpact
• Humorousapproach
• Oftencreatedbycustomersdirectly
• Nocontrolofmessage
• Couldriskproduct/brandimage
• Emotionalapproach
• Activationisneeded
• Story“doing”
• Boundtobrandvalueproposition

14. 0%
MEMBERSHIP
X-SELL
DEPOSITSLOANS
% OF ATL INSTITUTIONAL EXPOSURE BY
PRODUCT FAMILY (KNOWN BRAND) CRITERIA FOR DEPOSIT AND INVESTMENTS
100Performance
Solid / Trustworthy
Operational quality
perception
Competitive pricing
Market analysis and
forecasting
Advisory
80
50
47
43
41
BRAND
IMAGE
100% 50%
CRITERIA FOR FINANCIAL
INSTITUTION SELECTION
1. BRANCH LOCATION
2. NUMBER OFBRANCHES
3. PAYMENTS
4. SOLID/TRUSTWORTHY
CRITERIA FOR LOAN
APPLICATION
1. COMPETITIVEAPR
2. FAIRCREDITLIMIT
3. AGILITY
4. MAINBANK
CRITERIA FOR OTHER P&S
PURCHASE
• INSURANCE: SOLID/
TRUSTWORTHY
• CARDS:APR/REWARDS
PROGRAM
%ATLINSTITUTIONAL
%BTL/Promo /MD
Marketing mix:ATL/ BTLand primary focus on deposits

15. Achieving a standardized in branch experience: brand to commercial model
Business
Who am I?
Operations
Advertising
What do I have to
offer?Value Proposition
How do I deliver
my promise?
Commercial Model
How do I become
efficient in doing
that?
Operational Model
BRAND
PORTFOLIO
STAFF
BACK OFFICE

16. INTERNET
BANKING
MOBILE
BANKING
PHONE
BANKING
ATMs CORBAN
OMBUDSMAN
SOCIAL MEDIA
ORACLE
SIEBEL
CRM
BRANCHES
SIEBEL
MARKETING
TECBAN
SAQUEPAGUE
PAGFOR KONI REDEBANKSNPS SEEKR
L E G A C Y S Y S T E M S
O M N I C H A N N E L M I D D L E W A R E
SERVICE COMPONENTS
MIS
BI
DASHBOARD
TRADITIONAL
ALT.HOURS
TELLERLESS
BUSINESS
ITINERARY
100% 100%
TELEMKT
100% 25% 25% 50%
100%
0%
%
Integration
Level
COMPLEMENTARY
LAYER
FEATURES
CROSSCHANNEL
LAYER
Sicredi omnichannel platform architecture: 24/7 online, 13 billiontransactions / year

17. Channels withpartial or full CRM and Campaign Management integration
BrickandMortar InternetBanking MobileBanking
% TransactionalVol.
6%
% TransactionalVol.
18%
% TransactionalVol.
36%

18. Evolution of technology for online channels
Internetof
Everything
Omnichannel
Multichannel
Integration
E-Banking
Customerdriveninnovation
Digital Bank 1.0
Digital Bank 2.0
Digital Bank 3.0
Digital Bank 4.0
1998 - 2002 2003 - 2008 2009 - 2014 2015 - …..
• Dial-up experience
• E-mail Contact Center
• Online Brochure
• Database & CRM
• Web-based account
origination
• Online Calculators and
Bill payment
• Web Chat & Call
• DW & KYC
• Seamless experience
• Full-function
smartphone apps
• Internal & hybrid cloud
• Click-to-Video
• Big Data & Analytics
• 360º customer view
• Digital Bank & Digital
Branches
• Rich cross-channel
collaboration & advice
• Omnichannel analytics
(structured &
unstructured data)
• “Market of One”
customer centricity
• InterCloud
• Social Networks
Sicredi Brazil US EU
*Source:TheFinancialBrand

19. • Onlinecustomeronboarding
• DocumentscanningandbiometricId
• Socialnetwork linked
• Customizable look&feel
• PFM engine(PersonalFinanceManagement)
• Campaigntrigger offersandservices
• Peerto peerinteraction andtransaction
• Easytoaccess(less securitykeys)
• Nofees
• Integrated with e-paymenttools
Asbrickandmortarbranchesbecomemorerare, digital banking isgrowing inrelevance dueto enhancedcustomerexperience, self-serving characteristic andlowcost.
Credit Unionsshouldbepreparedtoupgradetheironlineexperience andfaceanewcompetitor: fintech startup companies
FinTech and Digital Banking 4.0

20. YoungAdults and the Sharing Economy as Banking disruptors
• 53%saytheycan’tspotanydifference amongbanks
• 71%wouldrathergotothedentistthanlistentobanks
• 4oftheleadingUSbanksareamongleastloved brands

21. Banks willhave to learn from Silicon Valley disruptive companies to pitch offers
Powerfulautocompleteandindexedsearch
Product/Servicedetails(indeph)
BigdatasmartCross-sellengine
Referralengineandbehaviorfeedback Scalablebrowsinganddeviceresponsive
Adretargetingtechnology
Leanprocesscheckout/purchase/underwrite
Powerfulcollaborationfeatures:reviews
1
2
3
4
5
6
7
8

22. Wrap up
• Sicrediistrulyglo-cal:Anationalbrandandstandardizedoperationsmodelwithlocalpresence;
• Despitebrandingeffortsasolidcampaignmanagementengineiscoretopushforgrowth;
• Bankshave beentakingadvantage ofregulatoryboundariesinplace;
• ThreatfromFinTechstartupanddisruptive modelspressurebankstomove quicker;
• YoungAdultsdon’tlikebanks,andtheyhopesomethingdisruptivewilltakeplace;
• Don’tlistentoyour COO:buildaDigitalBankforyour customer,notforyour bank;
• Bankswillneedtobemoretransparent(nomorehiddencheckboxes)andlearnBigData;
• CreditUnionshavetheadvantageofbeign100%membercentered.Thatwillpayoffinthefuture.