Last week I had the immense pleasure of attending Net Finance 2013 in Phoenix, AZ. Speakers included big names like Larry McClanahan, VP of Digital Delivery at Fifth-Third; Patrick Myron, VP Distribution Marketing at Fifth-Third and Marc Warshawsky, SVP Mobile at Bank of America, and there was a lot of good information to take away from every session. I thought it would be great to share some of the highlights and key messages in this week’s posts and discuss how it all ties back into digital marketing.
One of the biggest topics (and one I found most interesting) was a panel discussion breaking down disruptors in the banking industry. There are currently three major issues banks have to answer and adapt to: mobile wallets, money movement and the branch experience.
1. Mobile Wallets
We’ve discussed at length the impact of mobile wallets on financial institutions, so it came as no surprise the topic was brought up at Net Finance 2013 Mobile wallets, digital wallets, or whatever name you want to give them haven’t really hit their stride just yet as banks, card companies and tech giants test the market to determine what specific demands users have and what type of incentives they’ll respond to, but their prevalence is only going to increase in the years to come.
This has become a space in financial services’ realm not fully dominated by financial services companies. Google, for example, launched its own mobile wallet that is doing quite well in relative terms. When consumers can turn to other companies to provide them with services they demand, it undermines their loyalty to their financial institution as a whole. If you’re not providing them with comprehensive service, someone else will.
2. Money Movement
In more transparent terms, “money movement” was used to define online banking practices such as paying bills and transferring funds. It’s a rarity to have to mail a bill anymore, and with online transfers being as simple as one or two clicks of the mouse, the role of the financial institution is minimized. The big problem for banks here is that in some cases someone’s entire account balance can be moved without ever speaking to a human. That doesn’t give the bank any opportunity to speak with the client and object to the move. While this doesn’t directly undermine loyalty, it makes it incredibly easy for the client to be disloyal.
3. The Branch Experience
One of the big things banks (and many other industries for that matter) are learning as technology becomes more advanced and pervasive is that while banking is necessary, banks are not. As we noted in a previous post, branches are being closed in less-trafficked areas because there is simply no value in keeping them open. Why go to the bank when you can do just about anything online?
How banks will adapt to this remains to be seen, but what is apparent is the branch experience needs to change. Banks will need to hire more qualified people, and tellers will need to become more universal bankers as opposed to simply handling money and cashing checks. There’s still something to be said for personal touch, banks just need to upgrade what exactly that personal touch entails.
What can banks do?
The big thing banks need to be doing is increasing their digital footprint and letting people know about the services they do offer. Clients may not be fully aware of the digital services you provide, even if they’ve been with your bank for years. Do you have a mobile wallet? Tell them about it. Doing something unique at their local branch, launch a campaign to tell them about it. Branches are really good about posting specials and offers on-location, but what good is that if no one is coming in because they’re banking digitally? E-mail marketing and even direct mail can be your best friends to adapt to a changing business landscape.
Check back in Thursday for the second installment of Kandi’s Net Finance 2013 recap.