The group was charged with bringing customers into its direct deposit program. It was seemingly successful, generating 30% of the customers establishing new relationships with the bank. But only half of those targeted ended up using the direct deposit service: The rest used other services with lower, and in some cases negative, margins for the bank, formerly known as Chemical.

When Chase did a profitability analysis, it found that these customers were generating less than their fair share of income for the bank (80% what the non-group-sales customers were creating) while incurring a higher level of expenses than their numbers warranted.

Group Sales had targeted hospital employees and was able to hide its losses for as long as it did because of a few high-income physicians. But while several of these valuable customers signed up, so did orderlies and other staff workers. When these low-balance customers wrote checks and visited tellers, they ate into the profit margins of other units.

Rather than scrap the program, the bank took aggressive steps to convert customers to direct deposit, which cut down teller expenses. It also repriced its Group Sales fees, building more margin into the program. Within 12 months the unit showed a $4 million profit – without cannibalizing any other operations.

Tony LoFrumento, currently executive director, CRM at New York-based Morgan Stanley but formerly with Chase before and during myriad mergers, told this story to illustrate the benefits of switching to a full view of the customer during a keynote presentation at the National Center for Database Marketing.

A full view of a customer can empower a sales representative to give up a point or two when negotiating a mortgage in favor of extending the lifetime of a customer. Conversely, product-centric companies run the risk of losing a customer because a representative within a single business unit did not treat a customer valuable to the entire enterprise appropriately.

Creating a holistic view of the customer involves breaking down product silos, extracting data from legacy systems throughout the organization, creating a CRM data mart to hold the information, and transforming account level data to customer knowledge, LoFrumento said. Only then can an organization apply analytics, which will benefit the entire enterprise.

But the program wasn't a total loss.

At its best, a focus on customer segments as opposed to product groups can help marketers maximize customer profit. But when customers remain siloed in product categories, marketers can miss marketing opportunities – or risk alienating those with high value to the entire enterprise.

The most significant yield is an increase in retention, loyalty, and ultimately profitability, said.

"Without [individual] customer profitability, there is no customer relationship management," LoFrumento said.