Compete Financial Services: Mobile Banking


Published on

Published in: Economy & Finance, Business
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Compete Financial Services: Mobile Banking

  1. 1. Compete Financial ServicesMobile Banking
  2. 2. What You’ll Gain From This White Paper This white paper provides an update of mobile financial service (FS) trends that occurred during Q2 2011. We aim to provide you with a clear sense of what is currently going on in the Mobile Banking landscape by examining key metrics – derived from Compete’s panel of two million consumers – to evaluate and benchmark how the industry is performing. This paper is complemented by four other papers: Mobile Money, which examines the mobile wallet landscape overall, and industry-specific papers on Mobile Credit Cards, Mobile Investing, and Mobile Auto Insurance. The data enclosed comes from Compete’s Mobile FS Intelligence Survey, our quarterly survey of approximately 1,200 consumers to understand qualitative sentiment on a variety of topics related to the mobile channel.1 Compete Financial Services Mobile Banking
  3. 3. Mobile Banking Where Mobile Adoption in Banking Stands Today In Q2 2011, 54% of bank account owners (checking and/or savings) were using a mobile device (Smartphone or tablet) to manage their accounts or conduct banking transactions. 38% of bank account owners used their phone or tablet to view their account balance, making this service the most popular mobile banking service. The next highest level of adoption was using a mobile device to transfer funds between accounts or finding an ATM/banking center, which 25% of bank account owners reported doing. Remote check cashing had the lowest adoption rate at 11%. The high use of checking balances and making transfers suggests that consumers are both consulting and managing their balances before making purchases as the phone increasingly becomes part of the in-store shopping process. The services least connected to the shopping process – making deposits and scheduling bill payments – will likely have the slowest adoption rates since they lack the “urgency” associated with in-store purchasing. Current Use of Mobile Banking Services (Bank Account Owners, Q2 2011) Consumers are Consulting Bank Balances and Transferring on the Go Services most directly connected to shopping process have highest adoption levels View Account Transfer Find Make Schedule Check Balance Money ATM/Bank Bill Payment Bill Payment Deposit 38% 25% 25% 22% 16% 11%2 Compete Financial Services Mobile Banking
  4. 4. Current Awareness of Mobile Banking Services Of key mobile banking services available on mobile devices, financial service consumers are most familiar with basic transactions such as viewing account balance, which has an awareness rate of 66%. Transferring funds between accounts, using a phone to find an ATM, and making or scheduling a bill payment have similar awareness rates, hovering around two-thirds. However, a large share of banking consumers remain unaware of other services, like mobile check deposit. One out of five consumers has never heard of remote check deposit and another 36% have heard of it, but know very little about it. Current Likelihood of Adoption of Mobile Banking Services The vast majority of banking consumers say they aren’t likely to start banking with their mobile device in the next three months. In fact, two-thirds of checking and savings account owners who aren’t currently using mobile banking say they aren’t planning to start anytime soon. Just 7% of banking consumers indicated that they would be very or extremely likely to start using their phone or tablet to make a bill payment. And just 5% of banking consumers said they would be likely to start using their mobile device to make a deposit. A lot has been made of the early growth in mobile banking. Online banking paved the way for mobile banking, contributing to early, high levels of adoption by consumers who were already banking online. However, adoption rates will likely taper off as mobile banking tries to entice consumers who aren’t online bankers. Aware of Mobile Banking Services (blue) Likely to Use Mobile Banking in Next 3 Months (green) (Deposit Account Owners, Q2 2011) Consumers are Familiar With the Basics 14% 7% 7% 6% 9% Consumers are familiar with basic 5% mobile services like checking balances, but less familiar with other services like remote check cashing View Account Transfer Find Make Schedule Check Balance Money ATM/Bank Bill Payment Bill Payment Deposit 66% 61% 62% 60% 55% 44%3 Compete Financial Services Mobile Banking
  5. 5. Why Aren’t Consumers Going to Start Banking on Their Mobile Device? Key barriers to mobile service adoption in financial services in aggregate include concern about security as well as a general feeling that there just isn’t a need to manage money on the go. However, when product owners are asked to share their reasons for not adopting mobile banking specifically (as opposed to mobile credit cards, auto insurance, investing) including viewing account balances and scheduling bill payments, the most common reason for not adopting bank account mobile services was slow wireless connection (52%). This reason outstripped lack of need and security concerns. Reasons for Not Using Mobile Banking (Bank Account Owners, Q2 2011) Top Reason for Not Adopting Mobile Banking: Slow Wireless Connection What consumers say about mobile money in general is not consistent across sub-industries Wireless I don’t need I don’t trust the I am concerned I use my I don’t have a connection to do this security of my there will be fees laptop/desktop data plan that on my mobile mobile device to access will allow me device is too slow my accounts to do this 52% 48% 40% 18% 8% 6% Mobile Banking Doesn’t Compete with Online Banking; it Complements it Only 8% of bank account owners indicated use of laptop/desktop as reason for not adopting mobile services, suggesting that mobile services complement rather than cannibalize online services.4 Compete Financial Services Mobile Banking
  6. 6. Current Use of Apps Checking and savings account owners download the most apps and use them often. 36% of bank account owners have downloaded at least one bank account mobile app; 7% have downloaded two or more apps for their bank account. 29% of brokerage account owners have downloaded at least one deposit app on their mobile device and 10% have downloaded two or more. Behind brokerage, 26% of credit card consumers have downloaded at least one app. Just 13% of auto insurance consumers have downloaded an auto insurance app. Number of Applications Downloaded (FS Account Owners, Q2 2011) Mobile Banking Apps Downloaded Most Often 36% of bank account owners have downloaded one or more mobile apps. 72% of bank account owners who downloaded an app, use it weekly or more frequently, with 31% of these 16% 5% 5% 19% 9% 2% 28% 5% 3% consumers using the banking app daily Mobile Mobile Mobile Credit Card Investing Banking 1 2 3 or more Mobile Apps Have Highest Impact on Consideration, Choice, and Recommendations within the Banking Industry Mobile apps have a higher impact in the banking industry than in other industries. App adoption is also higher in banking than in other industries, suggesting that as app availability and adoption grow so will impact on consideration, choice, and recommendation of financial service companies.5 Compete Financial Services Mobile Banking
  7. 7. Mobile Banking Key Findings: • Banking industry has the highest rate of mobile service adoption in financial industries, much higher than credit cards, brokerage, and auto insurance. • Awareness of mobile banking services is high, but likelihood to adopt in next 3 months is low. • Top reasons for not using mobile banking are slow wireless connection and lack of need, followed by security concerns. • Online banking paved the way for mobile banking contributing to early, high levels of adoption. Adoption rates will likely taper as mobile banking tries to entice consumers who aren’t current online bankers. • The services most connected to the in-store shopping process – consulting balances and transferring funds – have the highest adoption levels. Services least connected to shopping – making a mobile check deposit and scheduling bill payments – have the lowest level of use. • Mobile banking does not cannibalize online banking; It complements it.6 Compete Financial Services Mobile Banking
  8. 8. The Last Word… Implications and Recommendations for Mobile Banking Marketers • Link mobile banking services to the shopping process whenever possible. Services most directly connected to shopping have the highest adoption rates, so using these touch points as a launch pad to drive awareness of other services will fuel adoption, too. • Continue to drive online banking awareness and adoption, since it is complementary channel. Integrate mobile and online services in a two-screen approach delivering a seamless consumer experience. • Bridge the gap between awareness and adoption. Feature and promote mobile banking services more prominently on Web properties and rollout video, ads, and other online content to boost awareness levels for key services. • Drive adoption by creating relevance and urgency with mobile offerings. Provide enough incentive to get consumers to try out services. This can be done by creating unique offers or loyalty programs in the mobile channel. Use existing offline and online channels to promote benefits of cross-channel adoption. • Use marketing messaging to address the number one barrier for mobile banking adoption – slow wireless connection. To the extent possible, marketers should develop content and partnerships to help consumers understand causes and fixes for slow wireless. Emphasize security and the use case in marketing messaging, as these are two of the top barriers to mobile banking adoption. • Link mobile ads to apps. Consumers are open to seeing relevant ads within banking apps, which have a positive impact on consumer’s perception of FS companies. Mobile ads have a higher clickthrough rate than desktop ads, but they must be more noticeable.7 Compete Financial Services Mobile Banking
  9. 9. About Compete Founded in 2000, and part of WPP/Kantar since 2008, Compete is passionate about understanding consumers to inspire great marketing. We draw our data from the industry’s largest integrated online consumer behavior and survey panel, comprised of over 2 million opt-in participants. Compete has extensive expertise in the automotive, consumer goods, financial services, media, mobile, online, retail, telecom and travel markets. Strategic partnerships with the WPP/Kantar family of companies enable marketing optimization and a more holistic view of consumers. About Kantar Media Established in more than 50 countries, Kantar Media helps clients master the world’s multimedia momentum through analysis of print, radio, TV, internet, cinema, mobile, social media, and outdoor worldwide. Kantar Media offers a full range of media insights and audience measurement services. Kantar Media expertise includes audience measurement, advertising expenditure, media evaluation, single source market research, online analytics and social media listening. Drawing upon the deepest expertise in the industry, Kantar Media tracks more than 3 million brands and delivers insight to more than 22,000 customers worldwide. Learn More For more information about Compete’s role in advancing the online marketing effectiveness in financial services, please contact: Jennifer Johnston Canfield Michael Perlman Senior Associate, Managing Director, Financial Services Practice Financial Services Practice mperlman@compete.com8 Compete Financial Services Mobile Banking