It more or less started with telephones. On the day that a customer happened to call the bank to inquire or conduct a transaction, remote banking was on its way.
Well, sort of on its way. Telephones at home and in the office became increasingly complex as the 20th Century rolled forth, but not much changed for remote banking until 1961, when City Bank of New York installed the world’s first Automated Teller Machine, and branded it the “Bankograph.” At last, true remote banking was on its way.
Well, sort of. Well, OK, not at all. Whether unimpressed, or simply reluctant to entrust their hard-earned cash to a box of gears and wires, New Yorkers avoided the contraption. Six months after installing the Bankograph, City Bank removed it — presumably with less fanfare than when they installed it.
But good ideas are not easily suppressed. An ATM-ish device appeared in Tokyo in 1966. Another appeared a year later in Sweden. More attempts followed in London and New York. By the mid 1970s, ATMs were becoming commonplace.
With a slowly-adopting public, you might wonder why banks kept trying. There were two reasons. One was that, though still newfangled, ATMs were no longer a novelty in the 70s. Rather, they were a sign of a forward-thinking, with-it bank. Moreover, though clients over 30 were not easily persuaded to try, much less trust a non flesh-and-blood teller at that time, the next generation was growing up with personal computers. Banks understood that its future customers wouldn’t fear technology. On the contrary, they would demand it.
The other reason? Imagine the tears of joy in the eyes of the first CFO who did a cost/benefit analysis on Automatic Teller Machines. Continuous availability, no sick and vacation days, no benefits package, enhanced security, and reduced error.
For a possible third reason … those who were around in the 70s couldn’t help admitting that those new ATM things were just plain cool.
At that moment, banks began complementing person-to-person interactions with person-to-machine interactions — and more and more customers liked it. Virtual/interactive/online banking was a natural next step as technology permitted.
The natural next step after that is mobile banking. No, scratch that part about “next.” It is upon us. Our customers want to be able to interact with their bank whenever, wherever, and however it’s convenient for them. If we don’t provide it, someone else will.
Mar 12
6
Safety and usability to impact consumer adoption of mobile wallets
Mobile features have quickly become one of the leading characteristics that drive a percentage of the American population toward certain financial institutions. However, analysts say that while mobile wallet usage is expected to increase in the coming years, widespread adoption may still be inhibited by questions over safety.
For this reason, it’s imperative for financial institutions to be more vocal about the safety features mobile wallets offers its customers. Consumer protections that exist for credit and debit cards may not be the same as those that are attached to mobile payments. However, banks that clearly broadcast the safety measures in place for financial transactions made through smartphones may quell users’ fears, while highlighting the convenience of mobile features, according to a recent MarketWatch report.
A separate report issued by USA Today also raises the need for merchants, financial institutions and wireless providers to work together to make mobile payments more appealing to a broader demographic of users. Recently, AT&T, Verizon and T-Mobile USA developed a joint venture named Isis, which will allow Chase, Capital One and Barclaycard customers to upload credit and debit information into the Isis mobile wallet, USA Today reports. Isis CEO Michael Abbot says the collaboration will be an important step in providing a simplified process to consumers. In addition to allowing customers to tap their smartphones to pay for products, Isis also offers loyalty points, discounts and coupons.
“Today, when is the first time a merchant knows when you’ve been in a store? When you leave,” Abbott told USA Today. “Imagine now that on top of that they can interact and say, ‘tap in when you walk in the store and we’ll give you X, Y and Z.’ Ask consumers what they want and they will tell you what they have. Our job is to give them what they never knew they needed.”
Feb 12
28
Small-scale marketing campaigns can lead to large payoffs
When it comes to attracting a strong customer base, many companies believe that bigger means better. And while developing large-scale interactive and social media campaigns has a myriad of benefits, going local and launching small initiatives can have bigger effects than some companies may realize.
In order to meet prospective customers one-on-one, some companies have developed mini campaigns that focus on sparking conversation among consumers or generating leads by becoming more of a presence at venues and events. For example, setting up booths, asking to speak or creating product displays at large entertainment venues, fairs, festivals and other local events can allow small businesses to reach out and engage with customers, according to Inc.com. Businesses who agree to sponsor events can also build relationships with other companies and develop marketing partnerships with organizations that provide complimentary products and services. Forging alliances with other companies may give business owners the chance to expand into different markets.
In addition, business owners who sponsor events or attend large functions may not only generate more leads, but also have the opportunity to speak with current customers. One-on-one consumer feedback is essential to any company’s success, because it allows them to pinpoint areas they have mastered and categories that need improvement. In addition, customers who feel like their feedback is valued are more likely to stay loyal and recommend a company’s services or products to friends and family. In contrast, developing a reputation for poor customer service can quickly impede on a business’s success. For this reason, thinking outside the box and developing topic seminars on blogs, hosting a luncheon to discuss business initiatives or offering a discount for customers who agree to provide feedback can be a creative way to get consumers more actively involved with a business.
Over the years, companies may have built some stronger relationships while others have grown weaker. Business owners may benefit from contacting old leads that have turned down services or spend time strengthening relationships with smaller vendors or service providers, Inc. suggests. As a company changes, its products and services are likely to have evolved as well, and what may not have worked for potential customers, investors or vendors may be more in line with what they are currently in the market for.
Feb 12
22
Small banks may face social media obstacles
It’s no secret that social media platforms are becoming more instrumental in reaching out to various demographics, introducing new banking products, driving customer loyalty and responding to feedback. However, a new report sheds light on the obstacles smaller banks and businesses may face in adopting and utilizing these communication mediums, according to American Banker.
Social media, as a portal for communicating with clients on basic day-to-day transactions and products, can be an effective strategy for strengthening customer relationships. However, when this type of communication gets deeper into advertising and marketing, American Banker reports legal and compliance issues may arise that smaller corporations and banks lack the financial resources to properly manage.
Possible solutions
In order to stay competitive and possible circumvent legal issues that may arise, banks and small corporations can enlist the assistance of professional compliance services to provide guidelines and protocols for web content and security issues. According to Jackie Marshall, IT regulatory compliance director at ProfitStars, the information provided to organizations is derived from the Federal Financial Institutions Examination Council.
“Because the FFIEC guidance provides standards for all types of tech-focused products and services, it’s a natural extension to consider social media, because it’s based on the use of technology by internal personnel and by the public to establish the presence of the financial institution,” Marshall said.
New uses of social media
Finding ways to navigate potential social media issues may become even more pivotal in the coming years as many large corporations begin using these networks to determine loans and pricing information. While this type of social media use is still in the works, experts say its likelihood is strong and many institutions are already researching the most effective ways to put this plan into motion.
Although there is some controversy as to how effective using social media data to set pricing would be, analysts say that credit bureaus and scoring models have been factoring in alternative consumer data for years and social media is likely to be next in line. Further, experts say that many peer-to-peer lending websites have already begun using social media data as a factor in credit and lending decisions.
Feb 12
14
Get prepared to answer more customer questions
Many financial institutions are rolling out new services, incentives and features to increase customer loyalty, attract new customers and remain competitive in their sector. Given the industry-wide changes banks and lenders are experiencing, coupled with new mobile and technological features many are launching, customers have a wide variety of institutions to choose from when shopping for a bank. And as a result, many are being more selective and narrowing down their options by looking for specific terms, features and conveniences.
A recent Bankrate.com article highlighted some of the key factors many customers may be seeking out and relying upon to make their banking decisions.
1. Interest earnings
Whether it be the interest attached to a savings account, certificate of deposit or money market fund, many consumers are concerned about how much they will earn for banking with certain institutions. This is especially true as many households attempt to get their finances back on track and prioritize savings over spending.
2. Rewards
The ability to earn rewards through debit and credit card programs has been an attraction for many customers for years and is not likely to subside in the near future. As a result, bank customers are likely to comparison shop for rewards programs that offer incentives on spending in a variety of categories and impose minimal annual fees, which may cut into their rewards earnings.
3. Mobile features
Mobile technology is becoming more popular among Americans of different demographics, so customers may be eager to choose a bank that offers a comprehensive list of features and applications, according to Bankrate.com. Mobile applications are making it more convenient and expedient for customers to conduct simple banking transactions, ranging from transferring funds and inquiring into their balance to more advanced actions, such as making check deposits. Although security concerns may still dissuade some would-be mobile bank customers from enrolling in the service, financial institutions that are more communicative about protection and encryption safeguards may gain more customers.
4. Social media
In addition to mobile services, the ability to send feedback, learn about new products and build a relationship with banks through social media mediums such as Facebook and Twitter are becoming more important to customers. Financial institutions that stay current on their social media pages may be in a better position to retain customers and reach new demographics.