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Virtual Branch Myth #2, Part 2

Posted by David Peterson on Wed, Jun 12, 2013 @ 13:06 PM

In my previous blog entry, I detailed the myth that integrating online and mobile banking will hold back mobile banking.

As we continue the series in this blog post, I would like to address the issue of mobile being a separate channel.

Mobile is a Channel Myth: Mobile is the next evolution in online banking.

Mobile is cool. Mobile is hot. Mobile devices sales are rising as PC sales are falling. These type of stats are used as “evidence” that mobile is the next evolution of the online experience. When it comes to banking, the fact is that mobile is just another access point for consumers who want to access their financial institutions anytime, anywhere and on any device.

Newsflash: each access device is not a channel; your customer, acting beyond the branch, is the channel.

Think about how many types of mobile devices and operating systems exist today. You have the commercially viable iOS (Apple) and Android OS, plus minor systems in Blackberry (RIM) and Windows 8 (MS). There are multiple Apple devices and literally dozens of Android devices. Now suppose each of these required a separate interface to your core system. Each one would need to have its own user interface. The navigation for similar tasks would not be the same. All of this would generate confusion for your customer. Does that sound like evolution or taking your virtual branch back to the stone ages?

Customers want their financial institution to offer the same unified multi-device access they receive from the non-banking brands they trust with their shopping and browsing. Put another way, if decoupling mobile from online was a great idea, wouldn’t most all of the large online players be doing this?

On the contrary, Amazon and Apple go out of their way to integrate their mobile and online experiences across access devices. Facebook spends millions on ensuring that the user experience from online to handset to tablet is unified, integrated and consistent. Do you think that Facebook thinks that they should shun online and go mobile only? Of course not and neither should you!

Embracing a mobile strategy based on concerns over whether the days of online banking is over is a compromise that leads to dissatisfied customers and a weak Virtual Branch offering. To be successful, FIs need to focus on providing an integrated and unified customer experience that maximizes each access device for its unique qualities while ensuring that data, transactions, security protocol and user interface are consistent. This channel of one strategy is the central to retaining current and attracting new customers.

Stay tuned for more in my next blog post.

 

Tags: Virtual Branch, Online Banking, mobile banking, channel banking

Virtual Branch Myth #2, Part 1

Posted by David Peterson on Wed, May 08, 2013 @ 10:05 AM

There are many in financial services who believe that mobile banking is a channel of its own, distinctly separate from other online banking applications. They theorize that only when mobile is decoupled from all other online capabilities can mobile grow, expand and capitalize on its unique capabilities.

Those who argue for a mobile-only strategy usually believe in the following myths:

1) Online banking will restrict mobile from growing as it normally would.

2) Mobile is the next evolution in online banking and that traditional online access is archaic and antiquated.

3) Mobile and online channels are different and therefore deserve their own distinct applications and systems. 

To me these three myths are all part of one misconception: that the mobile channel can be successfully decoupled from other online services. To gain a better understanding of the issue at hand, these myths must be thoroughly explained and debunked. Due to the amount of information needed to discuss this topic, I will break this topic up into multiple blog entries.

mobile banking, online bankingMobile Is a Channel Myth #2, Part 1: Internet banking will hold mobile banking back.

In order for you to believe that online holds back mobile, you would have to assume that mobile will only take on all of the features that online offers.  Since so many financial institutions have online systems that are so far removed from the expectations of their customers, offering only the most rudimentary functionality, it is easy to see why they would be attracted to the bright shiny object that mobile represents compared to their antiquated online system. 

There is no question that PC sales are down while at the same time the sales of mobile handsets and tablets are off the charts. But without a synchronized mobile and Internet offering, consumers and FI support personnel alike must deal with a separate verification, authorization and issue resolution processes.

Rather than holding mobile back, Internet banking acts as an additional integrated resource for consumers.

Consider this example: suppose a consumer takes a photo of a check with a mobile device to make a deposit. Twenty minutes later, the same consumer is trying to verify if they have enough money to buy that flat screen TV they have found on sale – today only!. The mobile deposit will probably show up in the online system, but will the customer’s mobile available balance match up with the online balance? If the systems are separate, there is a good chance that they have separate interfaces to the core system that holds the balance information.  Separate interfaces often mean mismatched information.

Here’s another example, suppose a consumer creates a bill payment on their non-integrated mobile device. The bill payment goes through fine. When it’s time to pay that bill the next month, they find it on the mobile device and make the payment. The following month, when they need to pay the bill their mobile device is not available. So they use a friend’s computer to access their financial institution via online banking and look for the bill payment vendor. Only it’s not there because the FI has a mobile strategy that is not integrated into all of the access points that the customer can use. This same scenario plays out for issues such as support, security, authorization, dual control, and so forth.

Embracing a mobile strategy based on concerns over outdated online banking technology is a compromise that leads to future obsolescence and a poor consumer experience. Instead, to be successful, FIs need to focus on providing an integrated experience that maximizes each access device for its unique qualities while ensuring that data, transactions, security protocol and user interface are consistent. This channel of one strategy is central to retaining current and attracting new customers.

Check back soon for my next blog post - Mobile Is a Channel Myth #2, Part 2.  

Tags: Virtual Branch, Online Banking, mobile banking, channel banking

Hooked on Mobile

Posted by Mickey Goldwasser on Tue, Mar 12, 2013 @ 08:03 AM


As a person who regularly travels back and forth from Connecticut to Austin, I have to admit that I really rely on the ability to connect to work and home via mobile on a variety of devices such as my iPhone or iPad. During presentations, I often talk about how we have truly become a mobile society and talk about how, for many, the mobile device (be it a smartphone or tablet) has become an extension of who we are. I joke that we could be 10, 20 or 30 miles, etc. from home and realize that we forgot our cellphone and immediately turn around and go back and get it.

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Our mobile devices have even become the last things we put down at night and the first thing we pick up in the morning. That became even more apparent to me recently, when I had left the office to head to the airport with an associate and realized when we were almost at the airport that I had forgotten my iPhone on my desk. Since I was flying back to Connecticut, I sat there thinking how I would be able function without my iPhone until I returned to Austin next week. I thought about how much I rely on this simple device to check email, communicate and importantly do my banking as I travel. To say I was panic stricken would be an understatement. Luckily my associate was able to reach someone in the office who was kind enough to drive the phone the airport, and I was reunited it with. Imagine if you were in a similar situation, and I am sure you could relate.

In the Thursday, March 07, 2013, edition of USA Today there was an article on the topic of “Always Working” that discussed how mobile has become an integral part of our daily lives, be it work or personal. The article mentioned a Pew Research Center Study that cited that nearly two thirds of full time workers own smart phones, up from 48% two years ago, and one third own tablets, up from 12%.  I imagine that when you factor everyone else who own smart phones or tablets, we’d all agree we are hooked on mobile and our devices.
With more mobility comes more convenience, especially when it comes to banking, and with that comes even greater opportunity for banks and credit unions to better serve their markets. People are looking to convenient ways to connect with their financial institutions as evidenced by the following:

  1. The ability to connect any time anywhere is appealing as demonstrated by all the articles and the ongoing list of statistics about the growth of mobile.

  2. Like other ebanking transactions such as online transactions, mobile is cost effective and less expensive than traditional transactions done at a branch or via a call center.

  3. Consumers, both retail and commercial, are demanding access to financial institutions via mobile or tablet devices for their banking needs. Study after study is confirming this type of demand.    

  4. The ability of financial institutions to connect to their customer via a multitude of channels deepens relationships and provides the additional opportunity to connect with consumers.

  5. Adoption rates of mobile and mobile banking will only continue to rise as more and more of us realize the convenience. And it is not just a younger generation trend. Just walk into an Apple store and at the table you see groups of all ages learning how to use the iPhone and iPad and you’ll see my point.  

  6. Mobile has become top of mind for businesses and consumers, and this includes banks and credit unions looking to raise their service levels.

With all this in mind, it goes without saying that opportunity exists for banks and credit unions to extend their footprints and better serve the people like me who are simply hooked on mobile.

For the financial institutions out there, have you developed your strategy around mobile/tablet banking? Is your mobile strategy integrated into your overall ebanking offing?  If not the time is now. Opportunity is knocking.

Tags: mobile banking, mobile, always working