Why Tablets Like The iPad Matter To Retail Financial Services

Financial services firms need to support customers via a growing number of touchpoints. The fast growth of tablets like the iPad mean they are rapidly moving onto that list — Apple has sold 14.8 million iPads in only nine months, and we expect that by 2015, 82 million US consumers alone will be using tablets.

Tablets combine some of the best features of smartphones and PCs to create unique benefits for users and the eBusiness executives who want to reach them. They enable financial services eBusiness executives to develop services that are fast, rich, collaborative, portable, and - last but not least - cool.

These unique characteristics have only limited advantages compared to PCs and mobile phones for self-service interactions like transactional banking and stock trading for the majority of consumers. In fact, we expect that mobile banking has far more potential to become the dominant channel for day-to-day banking in the future.

But thanks to their portability, social acceptance, and rich collaboration capabilities, we expect that tablets will have a big impact on how financial advisors sell to and service customers face to face. Tablets can help advisors to be more flexible about where they deliver advice and enable them to provide advice more effectively and efficiently.  

As tablets become more widespread, eBusiness and channel strategy executives need to optimize their browser-based websites for tablets, define a tipping point to decide when to build native tablet apps, develop services that make use of the devices' full potential, and review whether and when to replace the tools advisors use today.

If you want to read more about this topic, I encourage you to read the full report here.

Alexander

Rabobank’s iPhone App Lets Customers Pay Bills By Simply Taking Pictures Of Them

In my recent report "Next-Generation Digital Financial Services," I argued that eBusiness and channel strategy executives need to develop a new generation of digital financial services that are SUPER: simple, ubiquitous, personal, empowering, and reassuring. Rabobank’s iPhone app is a great example of how to make it simpler for customers. 

About 30% of Dutch consumers pay their bills by using acceptgiros — standard yellow payment forms that merchants sent to them together with their bills. These forms are prefilled with all relevant information that is required to make the payment. The customer can pay the bill by simply signing the acceptgiro and dropping it into the letterbox of his bank or by paying it directly via online banking (which requires typing in a 16-digit code).

To make this process simpler for its customers, Dutch Rabobank added a new functionality to its iPhone mobile banking app last month, which it calls "acceptgiroscan." Users of the app can pay bills by simply taking a picture of the acceptgiro with the phone’s built-in camera. Optical character recognition (OCR) software then reads and translates the scanned image and prefills all necessary form fields. The customer just needs to confirm to initiate the payment. A YouTube video (in Dutch only) shows how the app works in detail.

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Forrester's Vision On The Next Generation Of Digital Financial Services

Many of today’s financial services websites seem increasingly outdated. Why? More and more people are using the web as their primary banking channel and firms like Amazon, Apple, and Google are raising the bar on what customers — especially the younger generation — expect from their banks.

Despite the fact that the online channel is more than a decade old, most retail financial services companies have yet to make full use of its potential. Many banks still don’t make it easy for customers to achieve their goals online, they struggle to provide compelling cross-channel experiences, fail to tailor content and functionality to individual needs, and don’t enable customers sufficiently to take action by themselves.

We believe that a new generation of digital financial services is required — one that provides a fundamentally improved digital experience. To be successful, these next-generation digital financial services should be SUPER — simple, ubiquitous, personal, empowering, and reassuring.

This framework presents Forrester's vision of the of future of digital financial services and describes the technologies, processes, and organizational aspects that will enable it. It also provides examples of leading financial services firms that provide next-generation experiences today.

A key enabler of the Next-Generation is Agile Commerce which means optimizing people, processes, and technology to serve today's empowered, ever-connected customers across a rapidly evolving set of customer touchpoints.

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AllSecur Is Providing Access To A Price Comparison Site Directly On Its Site

Most eBusiness executives wouldn't dream of putting comparisons of their products with those of their competitors on their own sites. But it's time to start dreaming. If the number of customers visiting comparison sites continues to grow, we will eventually reach the point where the majority of customers use them. It will make sense for some companies to offer comparisons long before that point is reached.

Since a couple of weeks, Dutch online insurer AllSecure — which is the online brand of Allianz — provides site visitors access to price comparison site premie.nl directly from its site. After filling in the license plate of the car that they want to insure, the site automatically pulls required car information like car brand, type, age, and price. Based on this information — and some personal data that the user needs to enter— he receives a personal quote that can be customized. Next to the quote, a box with a link to price comparison site premie.nl is presented.

Once the user clicks on the link, the personal data and car information is automatically used for a comparison query on premie.nl. A new browser window is opened that shows how AllSecur compares to four other providers.

AllSecure's initiative clearly makes sense: If online buyers use a comparison site as part of their research process anyway, why not offer them access to it directly on the provider’s site? By providing a “one-stop-shop” experience, the firm can limit the chance that the buyer will go to a comparison site directly and eventually buys somewhere else.

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Mobile Banking Will Displace Online Banking For Routine Interactions

2010 has shown us that mobile banking's time has finally come. Thanks to growing smartphone adoption, fast all-you-can-eat data plans, and more compelling mobile content, more people will start using mobile banking in the coming years.

Although this won’t happen overnight, the unique benefits of mobile banking, like simplicity, immediacy, and context, mean that it will eventually displace online banking for frequently used day-to-day banking tasks like checking account balances, viewing transaction histories, making transfers, and paying bills. By contrast, online banking will remain a more important sales channel.

If you are a Forrester client and want to read more about this topic, I encourage you to read my recent Forrester report.

Alexander

A Useful Framework For Discussing Personal Financial Management (PFM)

I have had various discussions with banking executives about whether they should invest in personal financial management (PFM) during the last months. One thing that often hinders the discussion is that people think of  different functionality when discussing it. Some refer to PFM mainly as account aggregation; others think of it as transaction categorization and budgeting tools. Still others think of savings goal tracking or peer comparisons. Discussion like “shall we invest in PFM” are therefore not very constructive.

A framework that Forrester developed nearly a decade ago provides a useful structure to guide a more constructive discussion. Instead of asking whether they should offer PFM, executives should instead ask whether they can help their customers with four main questions:

  1. What do I own? (account aggregation, total financial status)
  2. How am I doing? (transaction categorization, budgeting, savings goal tracking, peer comparisons)
  3. What should I do? (personalized recommendations based on transaction data)
  4. How can I take action? (personalized recommendations that are directly actionable)

If you are a Forrester client and want to read more about our take on PFM from a European perspective, I encourage you to read my latest report about this topic.

Alexander

SNS Bank Is A Showcase For The Future Of Multi-Channel Retail Banking

With more customers migrating from branches to the Web, bank’s Web sites are gradually becoming the heart of the customer relationship. Despite this, many banks’ multichannel strategies are still branch-centric.

As a medium-size retail bank with ambitious growth plans, SNS Bank in the Netherlands has developed an innovative multichannel banking strategy that clearly puts the Web at the center of the customer relationship.

It launched an integrated public and secure site with state-of-the-art functionality; reorganized its branches into a network of lean, cashless banking shops where customers can buy simple products from the bank’s Web site; introduced a mobile sales force that specializes in selling complex products from both the bank itself and other providers; and implemented a state-of-the-art cross-channel marketing campaign management platform.

With this new strategy, SNS Bank has adapted to changing channel behavior, eliminated channel conflict, and increased marketing effectiveness.

Those of you who are Forrester clients can read more about SNS Bank’s new channel strategy in my Case Study which was published earlier this week.

Alexander

Growth In Mobile Banking Adoption Will Be Driven Mainly By Smartphone Apps

Since banks like Bank of America launched native iPhone apps for Apple’s app store in late 2008, there has been an ongoing discussion about whether the future of mobile banking will be dominated by native apps or browser-based services.

With the adoption of smartphones that let people download mobile apps (like iPhones, Andoid phones, and BlackBerrry devices)  still being small today, banks will need to continue offering browser-based mobile banking services to reach most of their customers. But with smartphone ownership growing fast, I expect that most growth in mobile banking adoption will come from native apps and not from browser-based services in the coming years because:

1) Native mobile apps offer a much more compelling mobile banking user experience:

  • Apps are easier to find. App stores have become an important way for consumers to discover content. To find a mobile app, customers simply need to search for the bank’s brand name in the app store. Furthermore, mobile banking apps often appear in the list of most popular free apps — which creates additional promotion. Banks promote their native apps heavily since it positions the firm as an innovation leader and associates their own brand to other popular brands like Apple. By contrast, it is more difficult for customers to find out about their bank’s mobile banking Web site domain. Initiatives like dotMobi, with specific domains for mobile-dedicated sites still suffer because it is not clear which sites carry the .mobi extension and which don't. Furthermore, — since mobile search is in its infancy —searching via search engines like Google require additional effort.
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European Banks Shouldn’t Neglect Developing Mobile Banking Apps for BlackBerry

Earlier this week, Ulster Bank announced that it launched the first free mobile banking app in Ireland for the iPhone. The bank follows many other European banks that have jumped on the iPhone app bandwagon in the past 18 months.

In a report titled "The State Of Mobile Banking In Europe: 2010" that I published earlier this year, I argued that thanks to its large-screen, touch-screen interface, the app store, and the fact that it mostly comes with fast all-you-can-eat data plans, it opened many people’s eyes for the potential of the mobile channel. In fact, iPhone users are about three times as likely to use mobile banking as other mobile phone users.

Of the 42 largest banks in the UK, Germany, France, Italy, Spain, the Netherlands, and Sweden, as many as 28 now offer iPhone banking apps — a whopping 67%. Although their launch has generated a lot of free PR, these iPhone apps have limited reach today. According to Forrester’s Consumer Technographics data, only about 2% of European mobile phone users have an iPhone and no individual country exceeds 4% adoption.

To reach more customers, many banks are launching apps for other platforms these days. So far, 12 out of the 42 European banks we reviewed offer apps for Android (29%). But only two banks (5%) — Spain’s la Caixa and Germany’s Sparkasse — can be found on RIM’s BlackBerry App World.

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