Two years ago, digital executives at Scotiabank looked at the state of mobile banking and recognized the opportunity to roll out targeted mobile marketing to existing customers using the firm's mobile apps. At the time, too few banks were leveraging mobile as a marketing, sales, and cross-selling touchpoint — a problem that is still evident among US banks.
But rather than simply throwing random banner ads at mobile banking users, the digital team at Scotiabank opted to take a targeted approach that served up relevant offers in the user's context, made the "buy" task flow as convenient as possible, and put the bank in position to expand the effort in future years.
As a result, digital executives at Scotiabank have seen mobile cross-selling rates — as measured by year-over-year growth in unit sales via mobile banking — more than double, up 165% since the firm launched this effort.
Scotiabank’s mobile cross-selling initiative is just one example of a brand embracing the idea of mobile moments. Forrester’s wider research shows that mobile moments are becoming a major battlefield in banks’ efforts to win, serve, and retain customers.
Forrester has just published its 2015 US Mobile Banking Functionality Benchmark. The report reveals important insights about the mobile offerings from the five largest retail banks in the US: Bank of America, Chase, Citi, U.S. Bank, and Wells Fargo. Forrester clients can find the full benchmark report here:
All of these bank brands are relatively strong, providing customers with the services and functionality they’ve come to expect from mobile apps and sites. But perhaps the most significant takeaway from our research is that no single bank is leading: When it comes to mobile, the big US banks are achieving parity, not breakthrough.
Overall, the US banks are meeting customer’s needs... The US banks achieved overall scores of 65 or higher out of 100, scoring particularly well for enabling a wide range of touchpoints and transactional features. All five banks have extensive functionality across bill pay transfers and P2P payments, like mobile remote deposit capture and adding a payee from within the app.
Forrester has just published its 2015 Canadian Mobile Banking Functionality Benchmark. The report reveals important insights about the mobile offerings from the five largest retail banks in Canada: BMO, CIBC, RBC Royal Bank, Scotiabank, and TD Canada Trust. Forrester clients can find the full benchmark report here:
But different banks excel in different areas of mobile banking. CIBC and Scotiabank received the highest overall scores, each earning an impressive 75 out of a possible 100 in our benchmark. The two banks achieve mobile banking success with strong core banking features plus enhancements in key areas: For example, CIBC offers excellent product research tools, while Scotiabank recently launched a best-in-class help service within its mobile apps (see image below).
What’s the difference between a digital bolt-on and transformative digital disruption?
In the two years I’ve been on the road talking with executives around the world about digital business and delivering keynotes on digital transformation, I’ve been most frequently asked about bolt-on vs. transformation; what’s the difference?
A digital bolt-on is a digital project that is added to the existing business model that might improve the customer experience in a small way, but doesn’t fundamentally change how value is created for, and/or delivered to, the customer. For example, when a company updates a website and provides customers an electronic ordering platform, they are not changing the existing business model; they are simply providing an alternative channel through which the customer can buy products. The value proposition remains the same: buy and experience our product and you’ll gain value from the experience. Digital (in this case an online sales channel) has been bolted to the existing business model in much the same way a teenager bolts a spoiler onto an old car to make it "go faster".
How will digital disrupt the financial services industry over the next 10 years?
Over the past couple of days, I’ve been meeting with clients at Forrester’s Forum For Technology Leaders in Orlando. Clients mostly want to know how digital will impact their business. My approach in responding to this question is to think like the CEO of the company in question: First, understand the customer’s desires; then figure out how those desires can best be met profitably — I imagine how future technology changes might create new sources of customer value.
We’ve already seen massive change in the financial services sector: Technology is dramatically changing our customer experience and helping firms educate their customers. What more is yet to come? And what will companies need to do to win customers in the future?
While this is a complex question, it’s not hard to imagine a very different reality to the one that exists today:
Over the past decade, digital executives and teams at banks have made strides in digital selling by upgrading and improving their public websites — and more recently their mobile apps and sites. But conversion rates on many banks’ websites remain low — in some areas, well below 10% — even as consumers’ expectations for digital experiences rise.
To take their digital selling to the next level, digital marketing and sales teams at banks should look outside the banking industry for fresh thinking. One area to look for inspiration is retail: By adapting digital tactics that best-in-class retailers use, banking digital teams can make adjustments to their websites and mobile apps that boost conversion rates and sales overall. Forrester has just published a new report that outlines “What Banks Can Learn From Retailers' Websites.” Here are just three of the ideas we discuss in the report:
Merchandise around customers’ needs and journeys rather than product silos. Retailers have found success by merchandising entire site sections, and even microsites, around customer journeys and events. Yet our research finds that virtually all banks still use products as the organizing principle on their websites. In 2013, Wal-Mart created a complete "back to college" microsite with digital marketing on key landing pages. As a result of this and other digital merchandising efforts, Wal-Mart increased the number of back-to-school products sold on its website by 30% year-over-year.
In the age of the customer, your company must exploit digital assets in order to deliver world-class customer experiences and compete effectively. But moving the business from its traditional roots toward digital mastery requires the executive team to paint a compelling digital business vision.
1. Illustrate what customers will value in the future. The way your customers derive value from your products and services today will not be the same in the future. Your business will need to use digital technology to create new sources of value. Instead of simply designing a physical product or service to be used by a customer to satisfy a need, your firm must reimagine your products and services as digital services enhanced by physical products and people. Customer perceptions of value will be shaped by the digital experiences you create to help them achieve their desires. Your digital vision must help employees understand this shift.
American and Canadian insurers are facing some big challenges in 2015. Customer experience expectations, their willingness to consider a growing array of new options to buy insurance, and new competitors creeping into the business of insurance are pushing traditional insurers into new digital strategies. It’s no longer a question of digital channels or “other” when it comes to the customer journey; they’re now intertwined. Digital-dependent customers are eyeing new and more digitally savvy market entrants, while demanding more control over the experience and how their personal information is used. This year, digital insurance teams are crafting agendas that satisfy their firm’s hunger for increase market share and revenue balanced with changing demographics, adaptations in response to extreme weather, and regulation that has lagged the changing realities of digital. One thing’s for sure: Insurance eBusiness teams can’t afford to wait around, but they also can’t afford to make the wrong digital decisions.
Just what are the factors propelling North American insurer agendas this year? For starters, it’s about:
Uneven economic growth in North America. The 2008 financial crisis? It’s a distant memory in much of the US, but not for all. By most measures, the US economy is thriving, driven by rising consumer demand for homes, cars, and consumer goods, and, by extension, insurance. And in oil-producing Canada the decline in gasoline prices isn’t good news: Canada is threatened with recession.
Like most of us, you probably made a few resolutions you’re hoping to keep in 2015—eating better, exercising regularly, and reading more. Why not add one more resolution that will help you, your company and more importantly, your customers and agents? Keep your mobile insurance strategy current with new technology; customer, employee, and partner expectations; and pressures that are coming from competitors and more importantly, non-insurance competitors. Because one thing’s for sure—the pace of change in mobile and insurance is crazy, as evidenced by all the new examples of mobile insurance innovation that we uncovered while writing our soon-to-be published update of our 2012 report, “The Future Of Insurance Is Mobile”.
Need some help in updating your mobile strategic plan? Earlier this week, we published a major update to the Strategic Plan chapter in Forrester’s Mobile Insurance Playbook. The report, “Get Mobile Insurance Strategy Right By Designing For Customers' Mobile Moments”, answers two essential questions: How do we build a strategic plan, and what should be in that strategy? It also provides a framework for the plan that encompasses four processes:
Identify mobile moments and context.
Design the mobile engagement.
Engineer processes, platforms, and people for mobile.
Analyze results to monitor performance and optimize outcomes.
In 2013 I wanted to help executives understand some of the fundamental changes that are happening in business because of the digital revolution. Big names capture the attention of the media – who in the USA could have failed to hear about the collapse of Blockbuster or Borders? Who in the UK could have failed to hear of the demise of HMV? When writing about these failures, most analysts highlight the disruptive companies that put them out of business; companies like Netflix, Amazon and Apple. But I wanted to know if there was something more fundamental going on that impacts the ability of an incumbent to defend against digital disruptors. So in 2013 I set out to research digital business successes and failures in an effort to uncover the secrets of digital mastery.
I captured insights from my research in reports published in 2014. Here’s my pick of the top four you should read to gain a deeper understanding of digital business (these reports are available to existing Forrester clients, non-clients can purchase them individually or download a summary from this page):
#1 The Future Of Business Is Digital - The results of 18 months of research into what lies behind successful digital businesses were first published in March in this report. Originally published for CMOs and CEOs, the report was subsequently republished for CIOs as “Unleash your Digital Business”. This report highlights how digital business differs from traditional business; provides an overview of the customer’s dynamic ecosystems of value; and offers six strategies to help transform any business into a digital business.