Who Are Banks Targeting?
Of course, without users, no mobile banking program -- regardless of platform -- will be successful. So who are banks targeting with their mobile services?
"I think everyone's natural assumption is to target the Internet banking customer," says Rackley. "But there is a large contingent of people that doesn't do Internet banking that will do mobile. Not everyone sits in front of the computer, but they all have cell phones."
Even though the functionality may be similar, banks should not look at mobile banking as an extension of Internet banking on the phone, Gartner's Cohen adds, noting that the proposition of moving a customer completely from online banking to mobile banking is limited. "Why go from paying your bills at your desk to paying them while you are walking down the street?" she asks.
In addition to younger customers who already have shown an affinity for cell phone-based services, banks should look to market mobile banking services to new customer segments, including those whose lifestyles or occupations keep them away from a computer, such as blue-collar workers, agricultural workers, those who travel frequently and students, Cohen suggests. "A bank has to really understand their customers and their segments," she continues. "What are their needs and wants with the mobile phone?" The underbanked may want to do more robust activities, such as transactions and loan payments, while other segments may just want alerts, reminders and rewards management, Cohen observes.
Bank of America built up awareness of its mobile banking program through campaigns online, in its branches and through mobile advertising. "There was no particular demographic targeted at the time of the launch," says Doug Brown, SVP of e-commerce for the bank. The early adopters are self-selecting and "tend to skew much younger" than the bank's overall Internet banking customer base, he adds, noting that 23 million customers currently use Bank of America's online banking offering.
Since its May 22, 2007, rollout, Bank of America's mobile banking service had attracted 500,000 active mobile banking users by early December, according to Brown, who says the bank defines active users as those who have accessed the platform in the prior 90 days. Bank of America's mobile banking customers have the ability to view balances, drill down into transaction details, pay bills via accounts previously established online, and transfer funds to another Bank of America customer. The bank also has integrated into its offering Microsoft's (Redmond, Wash.) MapPoint technology, which allows mobile banking customers to find the closest branch and ATM locations. Brown says MapPoint is the second most common function used by the bank's mobile banking customers, behind core banking services, of which balance checking is the most-used function.
It's not only the largest banks in the country that are launching mobile banking services. With less than $1 billion in assets, Irwin Union Bank (Irwin, Pa.) began implementing its mobile banking solution in November 2007 with a small pilot program. It chose the goDough product from Jack Henry & Associates (Monett, Mo.) because of a long-standing core banking relationship with the vendor.
"We wanted a solution that would help us leverage our existing technology platform investments," says Debbie Cox, the bank's SVP of operations. "While there are different approaches and options offered by the various mobile banking providers, we prefer the goDough application because our clients won't have to download any software to their PDAs, cell phones or other hand-held devices."