Category Archives: Retail Banking

Banks Marketing Mobile Services to Commercial Banking Clients

Bank of America recently announced that it now has more than 10 million active mobile banking users.  Other leading banks, such as Chase and Wells Fargo, are also reporting very strong growth in mobile banking usage.  We expect the strong growth in mobile banking usage to continue, given the increased penetration of smartphones and tablets, the growing sophistication and power of these devices, as well as people’s increased comfort with using mobile channels for everyday financial management needs.

Much of the focus in mobile banking to date has been on the consumer market, but some of the leading U.S. banks are now directing their attention to the commercial banking market.  In recent weeks:

  • Financial technology vendor Jack Henry launched a commercial banking app for the Apple iPad.
  • Citibank incorporated elements of its TradeAdvisor online banking tool (which enables companies to conduct cross-border trade transactions) into its CitiDirect BE Mobile banking suite.
  • Wells Fargo integrated its TradeXchange service into the bank’s CEO Mobile app.
  • Bank of America Merrill Lynch developed an iPad app for its Paymode-X online payment and invoicing system.
  • JPMorgan Treasury Services introduced remote check deposit.

The examples above show that, not surprisingly, the largest banks have led the charge into new mobile commercial banking apps.  Small regional and community banks now need to follow suit, in order to meet commercial clients’ needs and remain competitive.

The objectives behind the development and marketing of mobile banking functionality in the commercial space are very similar to that in the consumer banking environment:

  • Lowering customer service costs
  • Enhancing the customer experience
  • Differentiating services from competitors, or reducing a competitive disadvantage
  • Reducing churn through the provision of “sticky” services
  • Providing additional customer touchpoints for cross-sell and upsell

Differentiation through commercial mobile banking (and in other service areas) can be fleeting, as other banks will aim to imitate certain value-added service and close the competitive gap. To maintain a competitive advance in the provision of mobile banking services, banks need to:

  • Continually research customer desire for and usage of new mobile apps
  • Effectively market these apps to new and existing customers
  • Communicate the value of these apps to bank personnel who deal directly with commercial clients
  • Integrate the emerging mobile banking channel with other customer sales and service channels to provide a seamless and consistent user experience.

Banks Adapting Branch Networks to New Realities

For decades, bank branches have been focused on everyday banking transactions. However, with electronic self-service channels now handling a dominant share of these transactions, branches have come under intense scrutiny, with many industry commentators predicting the decline and even extinction of the branch channel.  This view has been strengthened by the fact that banks are focusing significant attention on cutting costs in an era where revenue growth remains elusive.  And branches represent a significant cost for banks.

Banks are belately beginning to react to this new environment by developing new branch strategies that recognize its changing role.  Banks are now putting less emphasis on the branch as a channel for day-to-day financial transactions.  Instead, branch investments are being directed to capture the potential of the branch as a key channel for sales, customer relationship development (through the provision of complex and/or sensitive financial advice), and branding (even customers who bank online tend to want the physical reassurance of the branch).  In addition, banks are increasingly aware of the research value of branches, both in terms of directly surveying branch visitors as well as testing new product or service innovations in selected branches before full roll-outs.

Some examples of new bank branch strategies:

  • In a presentation this week at the Morgan Stanley Financials Conference, PNC outlined a vision of its branch network that involves a more dynamic definition of branches, which includes multiple physical formats, as well as greater integration with both remote sales people and electronic channels.
  • Huntington recently reported branch plans driven by both the desire for cost savings (closing traditional branches and opening in-store branches) as well as to leverage the latest technology (such as branch image capture and processing) to drive efficiency.
  • U.S. Bank has three branch models, which enables the bank to tailor branch investments to market composition and opportunity.
  • Wells Fargo continues to have a strong commitment to the branch channel, as it claims that the vast majority of financial products are bought in a branch. It follows a specific model for branch productivity that is based on both in network density and retail execution, and which is seen in the following chart from its recent Investor Day:
  • At its 2012 Investor Day, Chase discussed a number of branch innovations designed to reduce costs and improve the customer experience. These include self-service tellers, paperless tellers, instant-issue cards and access to remote sales specialists through video. It is testing other innovations like next-generation ATMs, paperless sales, and mobile demonstration zones. Chase is also continuing to deploy additional sales personnel in branches; at the end of 1Q12, Chase had more than 6,000 sales specialists (y/y increase of 21%).

As electronic channels continue to change how consumers and businesses interact with their banks, many banks are reassessing the level and type of investments in their branch networks.  Though most are still committed to the branch model—noting its importance in sales and understanding that many customers still want to have the reassurance of a physical presence—the role of the branch is evolving and this has important implications for issues like branch sizing, design, staffing, technology deployment, and merchandising, as well as integration with other channels.

The Six Triggered Campaigns Every SaaS Marketer Should Try

Almost any business can benefit from the strategic implementation of triggered campaigns (see: http://www.emiboston.com/wp-content/uploads/2012/03/Triggered-Campaign-Field-Guide.pdf) to increase mindshare, walletshare, and lifetime customer value. For SaaS businesses, though, the benefits can be even more powerful as success depends on the optimization of the ongoing revenue stream from existing customers and prospects in trial. In a SaaS business, there is a proliferation of customer “moments of truth” – points in the customer lifecycle when the customer experience can significantly affect the business decision-making process. Because services are often paid for as-you-go, a change in usage volume, a service experience, training attendance (or lack thereof), and the degree of understanding of the product features can all lead to decisions to increase or decrease contract levels. As a result, marketing based on usage behavior and lifecycle rises significantly in importance as there is a strategic imperative to influence and/or drive interactions.

With that in mind, the following is a list of triggered campaigns that any SaaS marketing team should think about putting into circulation:

  • Free trial conversion. Once a prospect is in trial, that is the opportunity to communicate the value of the product – to reiterate the benefits and make it an easy decision for them to move from trial to paid. The conversion campaign should be planned as a series of communications, ideally including sales scripting. Customer testimonials and cautious use of incentives (e.g., discount offers) can be effective.
  • Win Back. You win some; you lose some. Having invested in getting the prospect to trial or even to a paid subscription, you shouldn’t sit back and simply accept the loss of a customer. A campaign based on common reasons for cancellation and/or non-purchase, potentially featuring incentives to entice the customer back, is vital to ensuring that you are maximizing the return on your acquisition costs.
  • Onboarding. Immediately after a customer has agreed to a pay is not the time to sell, but it is definitely the time to reaffirm the customer’s decision and the value of the product, as well as preparing the customer for future communications. The Onboarding campaign can be a single email, a series of emails, or even a multi-channel/multi-touch effort.
  • Training attendance. Even if it’s the greatest software in the world, customers won’t use more, expand their user base, and spend more unless they really understand how to use it. A triggered campaign targeting training attendance is therefore vital to maximizing lifetime customer value. The campaign can target individual users or a point-person/advocate who has a stake in training attendance.
  • Cross-sell and up-sell. After the onboarding campaign has laid the relationship groundwork and the training attendance campaign has ensured initial satisfaction, it is time to begin trying to increase walletshare. Cross-sell and up-sell campaigns should not apply a “hard sell” approach; they should be informative rather than overtly promotional. Again, customer testimonials (e.g., “see how customers like you are getting the most out of the software”) can be a powerful messaging element.
  • Feedback. Nothing enhances satisfaction like being asked for feedback. Any important point of contact (e.g., service call, initial implementation, training session attendance) should be seen as an opportunity to solicit opinions. But beware: if you don’t take action on the feedback, asking can be worse than not asking at all.

The good news for marketers is that not only is lifecycle information available for triggers, but now, through companies like Totango (www.totango.com), one can easily create and execute triggered campaigns based on software usage.