We’ve Moved

Banking Kismet has moved to iMazuma.

The link to the new blog is http://www.imazuma.com/blog/

The RSS feed link is http://feeds.feedburner.com/imazuma

Mint Launches Bill Reminders

Mint has released a new feature, “bill reminders”, for their online PFM software. One awesome feature is that the reminders can be sent to you by SMS. You can read more here.

Does Age Really Matter?

There was a discussion on Twitter yesterday that revolved around an article that discussed the new marketing campaign at Bank Of The West. The article stated that the bank was targeting adults in the 18-54 age range.

As I stated on Twitter, “everyone” is considered a customer segment also. This “targeted segment” just smacks of laziness. It also makes Bank Of The West sound like almost every other bank and credit union in the market.

They claim they want a specific type of customer, but they really want everyone. Most people don’t want to be a part of something that accepts everyone. Customers are more attracted to something that’s exclusive.

What an 18 year old wants in a bank is different from what a 30 year old wants. What those two want would be different from what a 50 year old wants. From what I’ve seen, if you target a market that has more than a 10 year difference in age, you’re just praying you’ll get lucky.

Now, I don’t think using age as a key criteria is bad, as long as it’s used in conjunction with other demographic segments. But if you’re one of those people that still thinks age is the only indicator that matters, you might want to switch careers from marketing to telemarketing.

Making Mobile More Secure

Security concerns about mobile banking has apparently been part of the reason for the slowing of growth in the channel.  Fortunately, some very smart people are working on solutions that will help ease those fears.

Apple will be releasing facial recognition technology in their iOS 5 update.  This means that mobile banking apps for Apple products will be able to implement a new layer of security.  I can imagine that developers will jump all over this feature.  One can only hope that vendors will be aggressive with implementing this also.

You can read more about the update over on ReadWriteWeb.

It’s A Mobile World

Apple recently released their third quarter earnings and the iPhone and iPad combined for 68% of all of Apple’s revenue.  The iPhone actually makes up 46.6% of the total revenue, which breaks down to over 20 million units and $13 billion.

In case you’ve been sitting on the fence about implementing that mobile strategy, it’s time to go all in.  Android device sales have been keeping pace with Apple devices.  In the near future, more people will access the web from their mobile device than their computer.  You can bet they’ll be looking for that cool mobile banking app also.

So You’re on Social Media? Prove It.

Well congratulations.  You’ve been successful with setting up the Twitter, Facebook, Flickr and YouTube accounts for your financial institution.  You’ve also set up a blog that has more than 100 daily readers.  You’ve even run a few Foursquare and Facebook contests.  Your Twitter account is actually used to communicate with customers, not just blast marketing messages.  I’ll bet you’re even looking into get your own special badge on Gowalla.

Looking at your website, you have all your social media icons listed on your home and contact us pages.  They can even be found on the footer of all your pages. And the best part?  Upper management bought in after you proved the business case for why social media is important.

But are you really all in yet?  The next time you’re watching those shows on DVR, watch some commercials instead of skipping them.  Did you notice that some companies mention their Twitter and Facebook pages in their commercials?  Open a few non-industry magazines and look at the ads.  Notice Twitter and Facebook icons there also?

Now look at the marketing material you send out.  I’m willing to bet that you don’t promote your social media sites on anything other than your website.  If you go into your branches, you won’t see any icons listed on your displays either.  But you know what you will find?  The link for your website.

The adoption of social media reminds me of when online banking came onto the scene.  It seems like it took forever for banks and credit unions to promote their website in their marketing materials.  Online banking was the driving force for getting websites promoted by marketing.

I’ve seen some discussion about low numbers of Facebook fans and Twitter followers.  Because these numbers are so low, people question the validity of social media in financial services.  This same argument was used when online banking first became available.  If you build it, people won’t necessarily come.

Yes, most of your online banking customers probably know you’re on Facebook and Twitter.  But that’s just because they noticed it on the homepage when they were logging into online banking.  Besides, that’s only about 25-35% of your customers.  We all know the online banking login screen is the #1 hit page on your website.

You have other marketing channels that you need to use to promote your social media presence.  There is absolutely no excuse for you to not list your links on direct mail, email messages, commercials, and branch displays.  I’m sure they will fit right beside or below your website link.  And if you’re really social media savvy, you’ll create and display a special #hashtag for your customers to use.

Comic from Dilbert

USA…A, USA…A

Well that’s so fitting.  The US Women’s Team pulls off a victory in one of the most exciting World Cup games ever and USAA is the #1 Place to Work in IT.  It’s nice to see a financial institution is on top just when you thought the financial services environment was lagging.  What’s even more surprising is they’re #1 for the second year running.

USAA has long been considered an innovator in financial services.  The fact that they are also an awesome place to work is no surprise.  If you give techies an environment where they can continually learn and try out new ideas, great things can happen.  USAA seems to have it figured out.  If you take care of your employees, they will in turn take care of your customers.

In an environment where we hear of banks and credits closing every week, USAA is giving 18% performance bonuses to all 22,500 of their full-time employees.  Notice, it’s not just the executives and top salespeople that are being rewarded.  USAA recognizes that every one plays a part in making the company successful.

They must be doing something right, because every USAA customer that I know is very satisfied with the company.  They also have had accounts there for a number of years.

Typically, you hear executives talk about being like Bank of America, Wells Fargo, or Citi.  USAA, on the other hand, has been laser focused with taking care of the financial needs of our armed forces personnel.  They go to great lengths to make the experience as easy and painless as possible.

USAA understands that this is a service business.  It’s also reflected in how they treat their employees. Hopefully other bank and credit union executives will begin to look at USAA as a model to emulate.

Photo from Denver Post

Are You Uncomfortable?

I happened to catch part of an interview with Paul Azinger on ESPN’s “Jim Rome is Burning.”  They were discussing Tiger Wood’s decline and possible return to the PGA tour.  Paul mentioned that since Tiger became a professional, he only plays on familiar courses.  Now I understand why I never hear of him being at minor tournaments.  His whole game plan has been to master the few courses he plays on.

This sounds very similar to the banking industry.  Decisions are still being made based on what happened in the past.  Ron Shevlin posted a graphic on his blog recently about the declining branch channel.  Yet executives still have increasing branch goals as though branch traffic is going up, not down.  There also isn’t much emphasis on other channels that customers obviously seem to prefer.

Like Tiger, they just want to stick to what they know and what worked in the past.  Well, Tiger now has the lowest ranking he’s ever had in his career.  Banking is going through a similar struggle.

The question is, will executives actually start to make decisions based on the changes in the industry?  Telling the rank and file that “banking has changed” doesn’t mean much when your strategic plan is to do more of what you did in 2002.  Just like Tiger needs to heal and improve his fundamentals, bankers need to do the same.

I think playing new courses could help Tiger, and capitalizing on the changing environment can help bankers.  Going outside your comfort zone is how you grow and become better.

Mining Online Gold

Watching the keynote from yesterday’s Apple WWDC gave me a whole lot of ideas for cool banking apps.  One thing that stood out to me was the $2.5 billion that had been paid out to developers since the launch of the App Store.

One reason that developers have stayed on the Apple bandwagon is that they make it so easy to get paid.  Apple tries to make everything is simple as possible.  Giving developers tools that help them get paid quickly and view reports about sales is one way to keep them happy.  If only banks and credit unions did the same.

Lately I’ve been working on my secret project, code phrase “Rice Krispie Treat.”  With some of the planned features, I have need of a merchant account.  Every single bank and credit union that I viewed online offers business services.  Unfortunately, I have to call someone and set up an appointment to get started.

Compare this with companies such as PintPay, Chargify, Recurly and CheddarGetter.  In about thirty minutes, I can sign up and be ready to accept payments on my website, all from the comfort of my couch at home.  Actually, it would take that long if I wanted to fully integrate their gateway into my site.  For basics, it’s less time than it would take to open a checking account.

Commercial customers are the lifeblood of a financial institution.  Giving them tools that help them run their business better should be a higher priority.  They need more than online banking.  Besides, if I can sign up my business for online banking while online, I should be able to obtain other services online also.

Why I <3 My Big Bank

Steve Topper, over at Financial Marketing Insights, brought up an interesting question a few days ago: why would anyone with a lick of common sense continue having their checking account with any of the nation’s four largest banks?  Well, I happen to think that I’m smarter than the average bear, so I’d like to respond to that question.

First, let me say that I do understand where Steve is coming from.  I used to work for a large community bank and I’m also a fan of credit unions.  But I still do a majority of my banking with one of the big four.  There are really only two reasons that I stay there:

1. They have ATMs coast to coast
Years ago, I used to travel a lot.  Now, I anticipate traveling even more.  It’s nice to know that wherever I go in the US, I can find an ATM for my bank.  I do realize that credit unions actually have a larger network (which is something they DON’T play up enough, if you ask me.)  It all comes down to location, location, location. 

With my former employer, as soon as you left the coast (and I mean a county or two over), you were subject to ATM fees.  Actually, that’s no longer true.  There is just a perception that you have to pay a fee.  You can use an ATM if it’s in the MoneyPass network.  However, it’s not really advertised, so they are like credit unions in that regard.

2. Better technology
How many banks and credit unions have mobile banking through the mobile browser?  How many have an app?  How many have text banking?  Now, out of the ones have text banking, how many offer transaction alerts? Let’s be clear, mobile banking through the browser doesn’t have a big adoption rate for a reason.  The FIs that are really growing mobile banking faster than the industry rate have text banking with transaction alerts. 

With very little marketing, my former employee blew away Bank of America’s adoption rate because they had text alerts.  However, most FIs don’t offer this feature.  The big four all have text banking.  They also have apps for smart phones and have either launched or plan to launch a tablet app.  Here are some other services they offer:
– Online loan applications
– Online account opening
– External transfers
– Deposit through ATM
– RDC using a smart phone
– PFM

In customer segments, I think I fall into the “tech-savvy and prefer self-service” segment.  I want to perform my bank transactions through any channel that suits me.  I also want to be able to go an ATM without incurring a fee, no matter where I am.

The smaller banks and credit unions aren’t there yet.  Heck, I have a feeling that most of them are still trying to push through the business case for better technology to upper management.  But to most people, a checking account is a commodity.  Although my account doesn’t say “free”, it is free, provided I stay within the required conditions.  For the life of me, I don’t see what is so bad about this.

At the end of the day, customers just care about whether their money is safe or not.  Also, can they get to it any time/way they want?  I have never been charged a fee that I didn’t know about.  But then, I tend to read the fee schedule on my account.  For the times I was charged a fee, I was able to get it reversed most of the time.  For the times that I wasn’t, there was a lesson learned.

I think that as an industry, we need to get past this “no free checking” = “bad bank/credit union”.  There are a lot of happy customers that are willing to pay for peace of mind and multiple banking channels.  Odds are, these are the customers banks and credit unions would want. Offering a free checking account isn’t going to make them open an account.  That’s just one of the many bullet points they’ll be looking at.  They also know that “free” doesn’t necessarily mean better.