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Engagement Banking - Presented on 1/25/2011 at the WRG Austin Road Show by Bryan Mishkin

Engagement Banking - Presented on 1/25/2011 at the WRG Austin Road Show by Bryan Mishkin

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  • Blockbuster was slow to adapt to the shift in their business from brick and mortar to online.Dell was slow to adapt to the commoditization of the personal computer and resisted putting their computers in stores for years
  • Paper money is on the decline. We can expect mobile payments to hasten this decline
  • Why are we ripe for a shift? Industry is behind in technology adoption and architecture.We tend to take a wait and see approach which won’t work anymore because technology moves so quickly that wait and see will become wait and see ya later
  • Past 125 years have seen more change than the previous 5,000 in human historyTechnology is being adopted faster with every new technology that is introduced. The iPad and Xbox Kinect further illustrate this point
  • How many of you have heard of these companies? If you haven’t you should be looking into them TODAYTalk about what each of these companies is doing and how it could threaten credit unions over the long term.
  • Do you view mobile banking as a sales tool for those that aren’t members and don’t have accounts?
  • Discuss the branch model, need numbers around branch traffic decreasing overtime.Discuss not viewing online/mobile/ecomm/eServices as an alternative channel anymore. View it as a primary. For many members this is how they interact with you.Startups don’t have the constraints of Legacy systems. They have the benefit of developing from the ground up.Core technologies are 15-20 year old technology. They were never intended to be used in the way it is being used and the data structure is showing its age. Technology is typically viewed as a Cost center/versus revenue generation center.
  • The window to plan and execute is narrowing every day.They might not have the same confidence in a startup (RE Trust)
  • Soon enough convenience will supersede trust for most. Example of business we are losing and how a third party can influence that.
  • People are changing behaviors – increasingly they are willing to switch banks because of a lacking mobile or online offering.Very soon we will reach a day when a mobile banking offering (or lack of) will cost you members and business.
  • Create a good product that customers will want to use first, contend with the security, compliance and technology issues second.5-10 years ago people were satisfied with getting their balances, viewing their history, etc. but today they want to know what it all means, how they can be better stewards of their money, and get all of that anytime anywhere.
  • Discuss importance of scale of infrastructure. Must be able to handle the new channels that are not even out there yet.Business rules layer. Core is a data layerTalk about data presentment across all channels in the same way.
  • Makescore a data source like any other data source and allows it to be treated that way.The core is no longer the only system that matters. Consistent experience
  • Create a user experience so compelling that members will be telling their friends about it.Apple as an example – iPad; iPhoneCreated a product offering where non existed before. Were brave enough to give consumers something that didn’t know they needed but that enriched their lives and was easy to use. Smartphones were nothing new in 2007, they were just horrible experiences. Apple changed that forever by making it so easy to use a manual isn’t required. They did the same thing with the iPad. They’ve made technology so easy to use that anyone can use it and nobody feels intimidated by it. That’s the philosophy we should live by.Discuss how some simple user experience changes increased our online account openings in 2010 130%. 2011 is projected to increase another 33% over 2010.
  • How are you going to present information with consistency?There’s no reason the online and mobile channels shouldn’t be offering all of the capabilities that a branch does and then some.
  • Discussthe drive through – how it came to be, convenience aspect and how it holds true today. People in a drive through can and should be enabled online. If you do that the drive through will be emptyDiscuss Apple store as an example. You can buy online, you can buy in store.
  • When unifying in the online portal, all views should show inside that framework. No pop-ups, and no punch outs. To the member it should all be in the same window for everything they need.Talk about how data convergence can enable this. If the vendor doesn’t support it, they aren’t our vendorSource the Bain Report – Online banks like USAA and ING Direct handily beat out Cus and banks in customer satisfaction and loyalty.
  • Over the long term your strategy should rival the branch. Learn from experiences with online, and don’t fear it; embrace it.
  • There’s no reason after 3 years a credit union couldn’t be the first FI in the mac app store. Where do you see the mac app store going? Mac apps could supplant web as primary method for online interaction via Mac.Microsoft will follow with the PC after success is proven by Apple.Discuss 17 million iPads in year 1. iPad sales are going to supplant laptops. What’s your iPad strategy?Discuss our automated lending project. What we are doing and how it’s going to change lending forever.Be willing to failAsk who is Attending SXSW Interactive
  • Technology won’t wait and the longer you wait the more time works against you and the more urgent things becomeCreate strategies for dealing with things like a mobile wallet so you are prepared to address it with your members and have something ready to go when it’s available.Show technology isn’t just a cost center by showing metrics of loans funded online and accounts opened online compared to the physical locations or call center.Working together can decrease the costs, enable more ideas to come forward and see the light of day
  • Talk about big banks marketing online, mobile, and dedicating airtime in TV ads to that with regard to treating eServices as a primary channel

Engagement banking public Engagement banking public Presentation Transcript

  • Engagement Banking
    Presenter: Bryan Mishkin Sr. Manager eServices
    Twitter: @bryanmishkin
  • Technology and Change
    New technologies enable new ways of doing business
    USAA Mobile Deposit Capture
    Rapid Adoption means we need to be faster to market
    Banking is not just for FIs anymore
  • Why is this important?
    Examples of Companies that have been slow to adapt
    Are you next?
  • The Writing is on the Wall
    90% of branch transactions involved checks
    In the next decade…
    Checks WILL disappear
  • Paper Money is Next
  • Cards will Supplant Cash in 2012
  • Transactional Branch Traffic Decreasing
  • Change is coming
    Financial Services is ripe for a shift
    Past 2 decades have seen more change then previous century in banking
  • Reaching 50 million people throughout history
  • Trouble?
    Other companies are coming after our business
    Lendingclub.com
    Banksimple.com
    Dwolla.com
    Paypal.com
    Mint.com
  • How are you preparing?
    What’s your mobile wallet strategy?
    What’s your strategy for phasing out checks?
    Can your mobile banking offering scale to provide all of the functionality in your online offering?
    Are you planning to attend a financial innovation conference like Finovate?
  • The Challenge
    Credit Unions are already behind
    Change happens faster each time
    Puts you further behind with each change
    Legacy Systems pose challenges
    Reluctance to invest and adopt new technologies
  • There’s Good News
    There’s time to plan
    Not every customer is embracing this shift…yet
    There’s plenty of opportunity catch up and lead
    People trust us and have confidence in us
  • But…
    Convenience can supersede trust for some
    Trust can be built over time by others
    People are beginning to change behaviors
  • Engagement Banking
    Being Customer focused
    Provide Insight and Meaning as opposed to simply presenting data.
    Consistency and convergence
    Innovate
  • Infrastructure – the foundation
    Scale
    Technology Industry Standards
    The power of web service apis
    Investment
    A willingness to invest in technology
    Treat technology as a primary channel
  • Upcoming Infrastructure
    REDACTED
  • User Experience
    Ease of use
    Understand your customers
    Serving your customers
    Never force someone to change channels
  • Convergence
    Branch, Mobile, Online
    Data Convergence
  • One Stop Shop
    REDACTED
  • Reinventing the Branch
    Need a reinvention
    Automate transactions, focus on sales
    Nobody ‘wants’ to be in a branch for a transfer or deposit
    View a branch as a Retail storefront
  • Re-envision online
    Easy to use
    Complete complement of services
    Unified in the online portal
    Direct lending 24/7/365
    Create a great experience with great service
  • Re-imaging Mobile
    Strategy should include rivaling branch capabilities
    Offer non-members information
    Goal: Convert to member
    Offer members convenience and interaction
    Trusted advisor
    Video conferencing
  • Think Ahead & Innovate
    Recognize and execute on emerging trends.
    Mac App Store
    Mobile Wallet Strategy
    iPad/Tablet Strategy
    Mobile Banking Strategy
    Socializing the experience
    Take risks
  • Moving forward
    Embrace the changing landscape
    Start now, don’t wait
    Position yourself for success
    Leverage CU Strengths
    Member Trust
    Collaboration
  • Wrapping Up
    Establish a strong foundation
    Treat eServices as a primary channel
    Put product and experience first
    Take risks and innovate
  • Questions?
    Follow me on twitter: @bryanmishkin