Category Archives: Retail Banking

If Your Mobile Web Site Is Done, You’re Still Not

A recent report by Nielsen Smartphone Analytics revealed that in June 2011 Android smartphone users spent twice as much time using mobile apps than they did using the mobile web. While this is only one month of data for one smartphone OS, there are important implications for marketers.

Above all, it illustrates the degree to which your company website is no longer the foremost platform for information dissemination. As more and more individuals — and businesses — adopt smartphones (and tablets) as their primary communications tool, the more mobile app use will become ingrained behavior. Coupled with the social media tsunami, this app tidal wave threatens to render obsolete the idea that your company website is the place where customers and prospects go to learn about and interact with your company. This, in turn, has significant implications for content and message development — what worked for the PC-based website environment almost certainly won’t work for an app.

Moreover, this data points to the need for strategic thought about what role a mobile website should play in the customer experience/sales process as opposed to the role played by social sites and apps. For the near term, each platform (PC-based web, mobile web, app, even email, direct mail, and phone) will continue to have its place across the customer lifecycle. But it is vital that companies begin to chart out the kinds of interactions they want users at different stages of the lifecycle to have and what, then, is the best platform for delivering those interactions.

Spate of small business lending commitments by banks

A meeting yesterday between Vice President Biden and 13 U.S. banks has resulted in a number of these banks announcing or reiterating small business loan commitments.  The banks include:

  • Chase: announced that it was on track to increase small business lending this year by 20% over 2010 levels, to $12 billion
  • Citi: committed to lend $24 billion to small business over the next three years ($7 billion in 2011, rising to $9 billion in 2013)
  • KeyBank: committed to lend $5 billion to small businesses over the next three years
  • M&T Bank: pledged to increase small business lending by $50 million over 2010 levels for each of the next three years

For banks, making such a commitment is important, as it acts as a rallying point around which resources can be concentrated.  Having a specific commitment also implies that the bank’s senior management has approved the objective, another key criterion for success.

However, announcing a specific lending commitment is only a first step.  For banks to achieve a small business lending objective, they need to design and implement an integrated plan that encompasses a wide range of activities, including:

  • Customer and competitive intelligence
  • Segmentation and targeting
  • Data mining
  • Product, service and offer development
  • Marketing communications
  • Merchandising
  • Sales channel optimitization (including structuring, incentives, training, and ongoing sales support)

In addition, these activities needs to be organized around customer needs and bank opportunities at various stages of the customer lifecycle:

  • Acquisition
  • Oonboarding
  • Cross-sell
  • Retention
  • Ongoing relationship development

For more insights in developing effective small business banking operations, see our white paper on The Transformation of Small Business Banking in the Thought Leadership section of the EMI Strategic marketing website.

Bank of America credit card production by channel: interesting trends

Bank of America recently published a breakdown of its credit card production by channel, in its second quarter 2011 Investor Fact Book.

Comparing the first half of 2011 with the full-year 2010, we see that eCommerce remains the most important credit card acquisition channel (at just over 28%), but its share fell almost 8 percentage points between 2010 and the first half of 2011.

Channels that have had the strongest share gain are:

  • Branch:  Bank of America was at the forefront of the push among leading bank card issuers to sell cards through their branches in the mid 2000’s, but this trend appeared to have lost traction in more recent years, as the financial crisis took hold.  However, there was a notable shift in the first half of this year, with branches accounting for 28% of credit card production, up more than 7 percentage points from 2010.
  • Direct mail: Traditionally, direct mail accounted for an overwhelming share of credit card production.  However, this share plummeted over the past decade, as response rates fell and new channels emerged with lower average acquisition costs.  However, this decline appears to have bottomed out, with bank card issuers now rolling out targeted direct mail campaigns to specific segments of interest, such as affluents.  DM accounted for 24% of card production in the first half of 2011, up 3.5 percentage points from 2010.