mobile banking trends

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MOBILE TECHNOLOGYMOBILE TECHNOLOGY


Asia is ahead on almost every metric, and the U.S. kind of catching up. For more advanced things like mobile commerce, the U.S. also ranks near the bottom among 16 countries included in the survey, which polled 4,100 people in Argentina, Australia, Canada, China, France, Germany, India, Indonesia, Italy, Malaysia, Mexico, Singapore, South Africa, Spain, and the United Kingdom.

SOURCE: SYBASE

The U.S. is Behind the Mobile CurveThe U.S. is Behind the Mobile Curve


A whole new generation of wireless networks is already being rolled out. The gains in terms of data speed and capacity stand to be significant — imagine having the broadband speeds you’re used to at home but on your phone or portable wireless hotspot. Sprint will be the first to market with its 4G WiMAX network. The network is rolled out in 27 major metro areas of the U.S. already, with at least 15 more cities to get coverage before year’s end.

SOURCE: CTIA WIRELESS ASSOCIATION

The 4G Generation The 4G Generation


With video becoming such a dominant force driving internet usage, and a perfect storm of fast networks and smart devices that can handle it, video will likewise be a significant driver of mobile data usage as well — occupying an estimated 66% of mobile traffic by 2013, according to Cisco.

SOURCE: CTIA WIRELESS ASSOCIATION

The Mobile Video ExplosionThe Mobile Video Explosion


63% of smart phone users say they “frequently” use apps that deliver specific content depending on the user’s location. More than one-quarter of U.S. mobile phone users have used a location-based service, and that 10% do so at least weekly. SOURCE: MOBILE MARKETING ASSOCIATION

Location-Based Services are PopularLocation-Based Services are Popular


Apple sold 1 million iPads in the first month since the product was introduced.

7.8 million iPads and similar devices will be sold this year, and more than twice that

number next year.

SOURCE: IDG RESEARCH

The Rise of Slate Computing … The Rise of Slate Computing …


Decline of the Laptop & NetbookDecline of the Laptop & Netbook

27% of iPad purchases will be made instead of buying a desktop PC, and 44% instead of a laptop. SOURCE: MORGAN STANLEY


Android phone owners use mobile banking most often. SOURCE: JAVELIN RESEARCH

Android Gaining GroundAndroid Gaining Ground


Android’s Strength …Android’s Strength …Android’s strength comes from its openness. The Android software development kit is open source and the license governing Android itself allows any phone manufacturers to use and modify it. This allows Android to shape the future of mobile computing by making it available to any hardware manufacturer that wants to use it. This means that Android is likely to be the OS of choice for future mobile computing hardware like tablet PCs or E-book readers. SOURCE: THE DAILY MONITOR


Google says over 100,000 new Android-based handsets are activated every day. This suggests Google's Android phone growth is greater than Apple's iPhone growth.

Last quarter, Apple reported sales of 8.75 million iPhones, which is 97,222 units per day

Android Sales Outpacing AppleAndroid Sales Outpacing Apple


Yamgo, a mobile TV firm, has released beta software for Android users so that they can see live streaming of high-quality mobile TV and video on demand. SOURCE: MOBILE COMPUTING

Android TV is Coming …Android TV is Coming …


MOBILE BANKINGMOBILE BANKING


More than 40 million U.S. consumers will be using mobile banking by 2012.

SOURCE: THE YANKEE GROUP

The Rise of Mobile BankingThe Rise of Mobile Banking


Banking Relationships Have Banking Relationships Have Changed DramaticallyChanged DramaticallyEfforts by retail banks to restore customer profitability face new and long-term challenges on several fronts.

According to the an Accenture study:

59% of executive interviewed reported decreased customer loyalty since the financial crisis 63% say their customers are more price sensitive 63% say their customers are "shopping around" more frequently

SOURCE: ACCENTURE


The Rise of Mobile Banking: Key TrendsThe Rise of Mobile Banking: Key Trends

The Majority Use Smart Phones

The Key age segment is 25-34 year olds

Mobile Banking users are more affluent

Men outpace woman

Speed & Convenience are Top Benefits

SOURCE: THE YANKEE GROUP


Balance enquiry: 74%

Notifications: 73%

Statements: 48%

Notification of account limit: 47%

Transfer funds between accounts: 35%

Pay accounts: 28%

Make a purchase: 21% SOURCE: BERG INSIGHT

What Consumers Want from Mobile BankingWhat Consumers Want from Mobile Banking


Incentives were a strong motive for younger people to sign up for mobile banking services, which allow them to keep track of checking and savings accounts on their cell phones. Of respondents to a survey, 40 percent of people 18 to 45 said incentives tipped the scales when it came to picking mobile banking.

SOURCE: AURIEMMA GROUP

Incentives Help Drive AdoptionIncentives Help Drive Adoption


A telling statistic is that the branch as the preferred method has gone from 36% to 21% in just 3 years - that is a decline of 41% in just 3 years for the branch as the 'preferred' method of banking.

With mobile internet banking adoption skyrocketing, check usage in question, we can expect this rapid decline to continue over the next 3-5 years.

SOURCE: AMERICAN BANKERS ASSOCIATION

THE SHIFT FROM AWAY FROM THE THE SHIFT FROM AWAY FROM THE BRANCHBRANCH


The iPad has sold over 1 million units in just over 1 month since its release, but this pales in comparison to the iPhone which has exceeded 100 million total units, with sales globally expected to reach 58 million this year.

Google’s Android operating system has been a huge success too. In Q1 of 2010 in the US market, Android-based phones outsold iPhones with 28 percent of the market Share of smart phones going to the Google platform.

Blackberry still commands 36 percent of the US market due to its strong enterprise support.

Less than 2% of US banks and credit unions have a dedicated mobile app for any of these platforms.

Banking & Mobile AppsBanking & Mobile Apps


The conventional process of depositing checks means that a business loses a lot of time and money. As RDC can drastically reduce the time and cost of depositing checks, almost every bank is now offering RDC to cater to new customers as well as to retain existing ones.

RDC has shown an impressive growth rate of 70% from 2004 to 2008.

SOURCE: MARKET RESEARCH.COM

Remote Deposit Promises Greater EfficiencyRemote Deposit Promises Greater Efficiency


CONSUMERS WILL …

Reduce Visits to Branches

Reduce Calls to Contact Centers

Change Their Spending Patterns

Generate More Transactions

Become more aware of their money

Become more educated about money

BANKS WILL …

Realize a Reduction in Costs

Be able to Generate More Loyalty

Be Able to Increase Their Customer Base

Create new mechanisms to stimulate impulse buying

Create new sales and marketing approaches

Mobile banking will change the competitor profile

SOURCE: MOBILE-FINANCIAL.com

Technology Changes BehaviorsTechnology Changes Behaviors


COST REDUCTIONCOST REDUCTION


The IT budget at most banks typically represents roughly 15 percent of the total operating costs.

But more important, the IT budget is critical to taking costs out of the other 85 percent of the cost base.

So initiatives to reduce technology costs must be undertaken within the context of how such initiatives facilitate cost reduction more broadly across the business.

SOURCE: BANK SYSTEMS & TECHNOLOGY

Strategic Cost ReductionStrategic Cost Reduction


Using a mobile platform such as SMS text messaging for simple and repetitive tasks such as reminders about payments due or balance requests can reduce the burden on IT and personnel resources. Using secure and integrated messaging platforms means that you can reduce the costs and errors associated

with paper-based payments.

Reducing Repetitive TasksReducing Repetitive Tasks


One of the biggest advantages that mobile banking offers to banks is that it drastically cuts down the costs of providing service to the customers.

An average teller or phone transaction costs about $2.36 each, whereas an electronic transaction costs only about $0.10 each.

Additionally, this new channel gives the bank ability to cross-sell up-sell their other complex banking products and services such as vehicle loans, credit cards etc.

SOURCE: MOBILE BANKING NEWS

Reducing the Cost of ServiceReducing the Cost of Service


While silo, channel-specific services are initially faster to implement, they create limitations as banks move from simple mobile banking services to full mobile commerce offerings. Having silo platforms in your initial implementations makes migrating to more sophisticated services technologically costly, as data, security and architecture attributes have to contend with multiple platforms.

SOURCE: IT-DIRECTOR.com

Silos Increase CostsSilos Increase Costs


Selling new products to existing customers has long been on most financial institutions’ agendas. Yet historically, few have had significant cross-selling success. Successful cross-selling requires that you understand what your customers need and that you keep track of their interactions. SOURCE: BANK SYSTEMS & TECHNOLOGY

A Failure to Cross SellA Failure to Cross Sell


SALES & MARKETINGSALES & MARKETING


The Mobile Sales OpportunityThe Mobile Sales Opportunity

There is an interesting opportunity in the mobile market to use the real time response capability of prescreen-of-one to meet the high expectations of mobile consumers. Imagine the impact of offering relevant, pre-approved products to consumers based on their current and immediate needs. The response

rate for relevant offers is always higher. SOURCE: U.S. BANKER


One of the most interesting dichotomies is the gap between institutions that can rapidly adapt their business rules and origination process to changes in the market and those who cannot. Today’s financial markets can be punishing for institutions slow to respond to change. In the mobile world, financial institutions that wait to implement sophisticated cross-selling techniques will miss much of the opportunity.

SOURCE: U.S. BANKER

The Mobile Marketing GapThe Mobile Marketing Gap


Loyal customers are those who stick with the financial organization over the long term. They tend to transact and invest more over time as their income grows. Increasingly, they devote a larger “share of wallet” to the financial organization they feel good about. They are also those customers who will tell their family, friends and business associates about you. Loyal customers dramatically lower the cost of acquiring new customers.

SOURCE: HARVARD BUSINESS REVIEW

A Loyal Customer …A Loyal Customer …


Financial Institutions Fall ShortFinancial Institutions Fall Short

Fewer than 30% of the average bank’s customers consider their bank for their next banking product purchase.

SOURCE: FORRESTER RESEARCH

The return on investment in the mobile banking space is directly correlated to maximizing adoption and usage.

The Key to Mobile ROI …The Key to Mobile ROI …

Financial institutions counting on an OLB-dependent strategy can only expect to reach 8% of their total customer base.

SOURCE: ONLINE BANKING REPORT

The Wrong Approach …The Wrong Approach …

Enable Customers Personalization

Optimize the Customer Experience

Look to the Future

Extend Mobile Across the Organization

Continuously Measure Response

Utilize Best Practices

Target 100% CoverageTarget 100% Coverage

Multi-Channel Enrollment Multi-Channel Enrollment

Online Website

Contact Center

Branch Tellers

Mobile Devices

ATM Locations

Interactive Voice


“Give people more control over their banking and you’ll win their loyalty. That’s because mobile is not a channel so much as a way consumers live their lives and consequently, the way banks have to conduct their business.”

Douglas BrownSenior VP Mobile Product Development

Bank of America

The Way We Live & Work TodayThe Way We Live & Work Today

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