BBVA Innovation Edge. Simple Bank (English)

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Simple bank is the way the world calls our customer centric bank. In this issue we sum up the best social business case study using simple bank and we analyze future opportunities around it. 'BBVA InnovationEdge' is the first corporate multiplatform magazine focused on innovation. Each edition featuresarticles, analysis and huge information about a particular theme. The mainpurpose of the magazine is to express the new trends and the upcomingtechnologies that may impact to the financial industry.

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BBVA Innovation Edge. Simple Bank (English)

  1. 1. JANUARY 2012 1simple The way the world bank calls our customer centric bank Winning the customer´s trust Customer centric, the new banking Top experiences New areas of growth also in this issue Trending issues Technology trends Edge January 2012 | SIMPLE BANK Innovation page 1Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  2. 2. new the secret of banking is... simpleT he world has, is, and will probably continue to struggle through a prolonged period of unparalleled and discontinuouschange. In order to address the shift, businesses and institutionshave been exploring new business/operating models. Someindustries are moving away from traditional “product-focused”models and beginning to embrace “customer-centric” modelsCustomer-centric” business models blur the line between traditionalnotions of value propositions, channels, and customer relationships. Inthe new model, it seems that the Channels are seamlessly integrated andoffer an assortment of “touch points”. The customers, when choosing topurchase and receive products, freely decide what kind of relationshipthey want to maintain at any given moment, for any given reason. Innovation Edge January 2012 | SIMPLE BANK page 2Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  3. 3. Winning the trust customer´s Shift happens and, in the business world, organizations are looking for new business model innovations to minimize risks and to maximize opportunities. The idea is clear: from pushing products to cultivating customers relationships. Innovation Edge January 2012 | SIMPLE BANK page 3Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  4. 4. S hift happens and it’s happening every- where and all of the time. Some wouldeven say that we are in the midst of a Coper- Over the last six years, CEOs and leaders worldwide noticed:nican Revolution: 2006 The frecuency of change. 1989 The fall of the Berlin Wall. “We are 2008 The velocity of change. free to choose our future.” 2010 The complexity of change. 1994 Netscape Navigator browser leads the way. “We can find out anything that Shift in business models we don’t know already.” In order to tackle the shift, business leaders and organizations have been exploring new 2002 Blackberry hits the streets. “We business model innovations to minimize can get stuff done anytime, anywhere.” risks and to maximize opportunities. As a result of the aforementioned explorations, 2003 MySpace provides our space. “We there seems to a clear transition from “prod- no longer need advice from an expert; we uct-focused” business models to “customer- can tap into the wisdom of crowds.” centric” business models.In the business world, the shift and its influ- Shift in Value Propositionence are evident as well. Disruptive changes Traditionally, or from a “product-focused”in technologies, customers, competitors, and point of view, Customers Relationships andthe environment are wreaking major havoc Channels were used to distribute Valuein the business environment. The last three Propositions (products) to a given Custom-Global CEO Studies published by IBM shed er Segment. In “customer-centric” businesssome light on the CEOs’ perception of change. models, it seems that the Channels are seam- lessly integrated and offer an assortment of “touch points”. The customers, when choos- ing to purchase and receive products, freely decide what kind of relationship they want to maintain at any given moment, for any given reason. Innovation Edge January 2012 | SIMPLE BANK page 4Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  5. 5. Confidential / Internal use onlyThe fall of the Berlin Wall 1986“We are free to choose our future”November 11, 1989 East Berliners climb onto the Berlin Wall tocelebrate the effective end of the city’s partition, 31st December 1989. Innovation Edge January 2012 | SIMPLE BANK page 5Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  6. 6. Netscape lead the way 1994“We can find out anything that we don’t know already”June 3, 1996 Founder of Netscape James Clark speaks June 3, 1996 in Chicago, IL. Clark, whofounded the Fortune 500 computer systems company Silicon Graphics, founded Netscape in April1994 with Marc Andreessen which currently employs more than 2000 people in 17 countries. Innovation Edge January 2012 | SIMPLE BANK page 6Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  7. 7. 2002Blackberry hits the streets“We can get stuff done anytime, anywhere”March 5, 2004 A traveler walks past an advertisement for Research In Motion’s BlackBerryhandheld e-mail device March 5, 2004 at O’Hare International Airport in Chicago, Illinois. Accordingto Don Morrison, chief operating officer of Research In Motion, the maker of the BlackBerry, thehandheld e-mail devices are used by numerous government officials on Capitol Hill. Innovation Edge January 2012 | SIMPLE BANK page 7Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  8. 8. 2003MySpace provides our space“We no longer need advice from an expert;we can tap into the wisdom of crowds”January 20, 2007 MySpace.com co-creators Tom Anderson (C) with producer Efren Ramirez(L) and Director/Producer Chris Barrett (R) from the film ‘After School’ poses for a portrait duringthe 2007 Sundance Film Festival on January 20, 2007 in Park City, Utah. Innovation Edge January 2012 | SIMPLE BANK page 8Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  9. 9. customer centric, thenew bankingDemographic change and technology innovation have left avisible impact on the way that customers interact with theirbanks. In a world where the customer has taken the control,the banks of the future must help each customer to reach hisindividual goals.I n the past, banks built customers’ trust by ensuring them stability and solidity – bypromising to stay the same forever. But ers want stability and flexibility; they want banks that can guarantee their security and respond to their individual needs. In a worldthe world is changing drastically. Custom- where the customer has taken control, the Innovation Edge January 2012 | SIMPLE BANK page 9Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  10. 10. banks of the future must become the guide into silos, with redundancies in infrastructurethat helps each customer reach her individ- and services causing disparate experiencesual goals. In the new world, value has less for banking customers. A customer-centricto do with understanding money, and every- model would require an agile infrastructure,thing to do with understanding people. which is designed with the customer as the starting point for products, services, and in-Currently in the retail-banking sector, the “shift” frastructure. This approach would provide ais already underway. Many actors (including consistent and unified customer experiencetraditional banks, “de novo” banks, and new and, in turn, would allow the banks to capital-“non-bank” entrants) are exploring and/or ex- ize growth opportunities, such as cross-sellingecuting new business models. According to and upselling. Of course, “de novo” banks andthe EFMA report, Transforming Retail Banking new entrants have a competitive advantageto Reflect the New Economic Environment, in that they do not have to worry about di-many banks realize that the customer-centric gesting the old “spaghetti”.business models are the future of retail bank-ing: “The vision of most banks is to provide Given the new reality, the banks and other ac-their customers with a seamless, fully integrat- tors are responding to the “customer-centric”ed and uniform experience across all chan- era of banking. This report offers a closer looknels. (However) many banks are still years at BBVA’s unique response to the shift towardsaway from achieving this.” customer-centric banking; and also offers some concrete examples of customer-centricOne of the main difficulties for the incumbent retail banking experience of other actors; fo-banks is the “spaghetti” infrastructure of the cusing on Flagships, Mass Market Retail Bank-current operating model; which are separated ing, and Virtual Banking. Innovation Edge January 2012 | SIMPLE BANK page 10Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  11. 11. world top experiences wide In this inevitable change towards ‘customer centric’ banking, BBVA is leading. Major changes to the BBVA business model have already begun, with the renewal of the back-end systems platform and continue with several front-end projects. Banks like BNP Paribas, Citibank or HSBC are also addressing the concerns of the ‘customer-centric’ era of banking, and testing ways of creating a personal rapport with customers. The vision of most banks is to provide their customers with a seamless, fully integrated and uniform experience across all channels. Here is how they do it.” Innovation Edge January 2012 | SIMPLE BANK page 11Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  12. 12. world 1top experienceswideBBVA´s answerAt BBVA, we have been focusing on CCB since 2008; the bankhas been hard at work to ensure that the efficiency side (theback-end) of the business model would be ready to offer acustomer-centric banking business model. With the goal ofoffering complete back-end capabilities for the Customer-Centric Bank by 2013, BBVA has mapped out its infrastructuretransformation. Innovation Edge January 2012 | SIMPLE BANK page 12Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  13. 13. E ach new technology delivers value, but the benefit to our customers and to BBVAbuilds exponentially as the technologies are needs, BBVA is committed to three principles, which guided in the design of the CCB model: Accessible Distribution. “BBVA givesintegrated: me different ways to do my banking, any- where, anytime.” Convenient, trustworthy, Customer Oriented Service and Produc- and pervasive, channels give customers a tivity (Commercial Scenarios; New Core range of ways to fit banking easily into the Banking; Digitalization; Operative Process- shape of their lives. es Redesign). Transparent Solutions. “BBVA knows what Customized Solution (New Core Banking; I need, and offers solutions that fit my life.” Commercial and Risk Intelligence; Private In a web-based world dominated by social Cloud; MIS Electronic Financial Record). networks, BBVA has access to enormous amounts of customer data—and a rich op- Convenient and Seamless User Interface portunity to provide its clients with solutions (Commercial and Risk Intelligence; NICE; custom-made to suit their needs. Instead of Mobile Channel; Public Cloud; New Inter- the expert, whose value comes from know- net). ing more than his customers, the CCB will be the tailor who knows his customers bet- Collaborative Relationship and Smart ter—and can recommend each of them Processes (MIS Electronic Financial Re- what fits best. cord; Collaborative Front End; New Inter- net; Customer Processes Redesign; New Human Understanding. “The people of Branch Design) BBVA really listen to me. I can always get the guidance I need to figure out how to Customer Centric Banking (New Branch get where I want to go.” Instead of selling Design; “Lola” (Online Banking Virtual As- to their customers, BBVA staff will work sistant) closely with them—to help clients under- stand what they really want from their fi-For the value side (the front-end) of the busi- nancial futures, and map out the stepsness model, in putting customers at the cen- they’ll need to get there.ter of experiences that meet their distinctive Innovation Edge January 2012 | SIMPLE BANK page 13Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  14. 14. Easy bank ABIL ATM Flagship KioskWalking into de Easy Bank, the customer steps into awelcoming space where he can do what he needs toget done, on his own or with help from staff Innovation Edge January 2012 | SIMPLE BANK page 14Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  15. 15. Easy bank ABIL ATM Flagship KioskBBVA ABIL ATM revolutionary banking machine. ABIL is a revolutionregarding the traditional self-service. It has a large touch screen,direct access to all common operations and has a surface that allowssupport personal items to operate with greater comfort. Innovation Edge January 2012 | SIMPLE BANK page 15Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  16. 16. Easy bank ABIL ATM Flagship KioskIn BBVA Bancomer customers can access specialized advice andreceive personal reassurance, at the same time flagships allowBBVA to buid out its brand, as well as offer customers day-to-daybanking via the easy bank area of the branch. Innovation Edge January 2012 | SIMPLE BANK page 16Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  17. 17. Integrated to customer’s social networks and activities Easy bank ABIL ATM Flagship KioskThese automated banking centers are avaliableto customers 24 hours a day offering a hassle-free way to do any of the everday transactionsthey need. Innovation Edge January 2012 | SIMPLE BANK page 17Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  18. 18. Based on customer insights and the three de- bank a chance to create an experiencesign principles, the BBVA CCB model offers: for customers that weaves deeply into the fabric of their ordinary lives. Examples More channels, more granular, and high- include: getting cash; making deposits, ly functional changing address Consistent, simple, and collaborative uni- My Life. Interestingly, customer modal- versal user interface ity changes as they move between these different needs. The same customer who Real time intelligent processes cares most about convenience when she’s performing everyday transactions want to Highly customized solutions based on spend a great deal of time researching op- customer understanding tions when planning for the long-term. Ex- amples include: Buying a home, planning Open to social networks and the web for retirement, saving for education Touch pointsThe BBVA Bank of Through a flexible network of virtual and physical touch points, BBVA offers custom-the Future: Customer ers a wide range of connections to the ser-Centric Bank of 2020 vices they need, available when they need them, in the ways that best fit their lives.Customer needsBased on conversations and collaboration By dividing our current branch model intowith customers, BBVA discovered that there a more granular set of components, we willare two forms of interaction with customers. create an array of options that enable cus-In other words, there are two kinds of finan- tomers to choose the banking experiencecial needs: My Money (Getting Stuff Done) that feels most comfortable—thereby weav-and My Life (Financial Well Being). ing their relationship with BBVA more fully into our customers’ daily lives. My Money. Because everyday transac- tions happen so frequently, they offer the At the same time, this modular approach en- Innovation Edge January 2012 | SIMPLE BANK page 18Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  19. 19. ables us to adapt our presence to the spe- BBVA assistant is available to help.cific needs of different markets—for example,to focus on low-cost, more automated chan- Point of Sale Banking & Pocket Bank.nels in some regions; and a greater number Customers can do basic banking trans-of flagship stores to serve various needs actions while shopping, using the cashiersuch as offering specialized advice, reassur- to perform ATM-like functions; and useance, brand building, marketing, client attrac- their phone to perform routine transac-tion and capture; as well as offer day-to-day tions through local businesses – includingbanking via the Easy Bank area of the bank. making deposits and getting cash. TheseAnchored to the internet, this flexible, modu- pocket banks extend BBVA reach to morelar array enables us to tailor our offerings to remote areas where customers cannotthe needs of different customers, while deliv- easily get to a physical branch.ering bank services across a wide range ofregions effectively and efficiently. ATM. The new BBVA ATMs improve pri- vacy, ease of use, and simplicity. All opera-Physical Touch Points tions, including PIN entry, are completed Flagship. Customers can access special- on a 19-inch touch screen that displays ized advice and receive personal reas- only information relevant to the transac- surance; at the same time flagships allow tion at hand. All cash, statements and re- BBVA to continue to build out its Brand, as ceipts are handled in and out through a well as offer customers day-to-day bank- single slot. ing via the Easy Bank area of the branch. Virtual Touch Points Easy Bank. Walking into the Easy Bank, the Computer & Web Enabled Phone (Inter- customer steps into a welcoming space net Banking). By computer and by phone, where he can do what he needs to get done BBVA’s customers get their banking done – on his own, or with help from staff. by connecting through a simple, intuitive, and familiar interface: The Internet Bank of Kiosk. These automated banking cen- the Future (IBOF). Lola, the online banking ters are available to customers 24 hours a virtual assistant avatar, offers human-like day – offering a hassle-free way to do any guidance whenever customers need it. of the everyday transactions they need. Innovation Edge January 2012 | SIMPLE BANK page 19Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  20. 20. Remote Support. By phone, video confer- Enhaced value proposition ence, or in-person, customers can connect BBVA has developed a new Value Proposition, with BBVA specialists for advice on topics based on the following customer insights: ranging from home buying to retirement planning – or for help with simpler trans- Bank the way they want to actions. Simple, easy and transparent relationship Real time resolution Complete control over their finances Innovation Edge January 2012 | SIMPLE BANK page 20Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  21. 21. world 2top experienceswide Innovative experiences in customer centric banking Currently, the branch is the main touch point for retail banking and, as such, banks are continuing to invest in it. In general, the banks are utilizing flagships to increase the value of the brand and/or use them as testing grounds for new customer experience innovations. Innovation Edge January 2012 | SIMPLE BANK page 21Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  22. 22. FlagshipsBarclays, United KingdomInspired by retail flagships, such as Apple and Nike, Barclays opened its Piccadilly Circus flagshipstore at the end of 2008 and announced that they would open 50 more in the near future. Accord-ing to Barclays, their flagships are more accessible, comfortable, and “simpler for customers” in anattractive and engaging manner. Innovation Edge January 2012 | SIMPLE BANK page 22Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  23. 23. FlagshipsBNP Paribas, FranceLaunched in late 2010, BNP Paribas’ flagship aims to “Offer everyone a new experience, a siteopen to all; reinvent the relationship with clients and prospective customers, through open-ness and responsiveness, whether informing people directly or helping them to learn; turn thebranch into a ‘lab’ promoting innovation and new features; and position BNP Paribas as a pio-neer of innovation.” Innovation Edge January 2012 | SIMPLE BANK page 23Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  24. 24. FlagshipsCitibank, USACitibank flagships offer hi-touch, specialist advisory services, and smart banking technologiesto improve the experience for clients across all channels in core markets. With the collabora-tion with Eight, Inc (responsible for Apple Stores design), the first prototype store debuted inSingapore in 2008. Over 100 branch-level processes were reengineered. There are even fourpatents pending.” Innovation Edge January 2012 | SIMPLE BANK page 24Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  25. 25. FlagshipsCommBank, AustraliaOpened in March 2011, CommBank’s flagship aims to offer, “seamless service through state-of-the-art technology and flexible banking solutions, (their) goal is to solve any financial need (thecustomers) may have, all in one place.” Commenwealth Bank’s flagship offers: an online bookingsystem, interactive touchscreens, NetBank kiosks, iPads and iPod Touches, a welcome conciergestaff, experienced banking specialists, and a professional barista café. Innovation Edge January 2012 | SIMPLE BANK page 25Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  26. 26. FlagshipsDeutsche Bank, GermanyDeutsche Bank’s Q110 is future orientated, simple, and different. Opened in 2005, the flagshipmakes bank products more tangible: “customers shop for financial products in off-the-shelfboxes, like in a supermarket.” Q110 fosters innovation culture at Deutsche Bank by providing a“playground” for the bank personnel, who are periodically rotated. Innovation Edge January 2012 | SIMPLE BANK page 26Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  27. 27. FlagshipsHSBC, Hong KongOpened in 2008, HSBC’s flagship model was part of the bank’s HK$300 million commitment torevamp its retail presence. “People are shifting from the more traditional, transactional bank-ing - over the counter - to more sophisticated financial planning, . . . The next step will be find-ing out how to make use of this good experience to build customer relationship.” The efficienthandling of basic transactions allows customers to “sit down” and discuss wealth manage-ment issues. Innovation Edge January 2012 | SIMPLE BANK page 27Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  28. 28. FlagshipsRaiffeisen Bank, SwitzerlandDesigned by world-renowned design firm NAU, “Raiffeisen’s flagship branch on Zurich’s Kreuz-platz dissolves traditional barriers between customer and employee, creating a new type of‘open bank’, a space of encounter. Advanced technologies make banking infrastructure largelyinvisible. ... This lounge feels more like a high-end retail environment than a traditional bank in-terior.” The flagship opened its doors in early 2011. Innovation Edge January 2012 | SIMPLE BANK page 28Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  29. 29. FlagshipsSkandia, SwedenOpened in early 2011, “everything is aimed at creating the right experience for the client.”Skandia believes that “a committed and involved client is also a more loyal customer andcan be a greater act as an ambassador for us.” “In today’s world of consumer power, finan-cial turmoil and demand for transparency even banks must be open and accessible: a placethat can make people’s dreams and ideas come through.” The flagship opened in early 2011. Innovation Edge January 2012 | SIMPLE BANK page 29Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  30. 30. Mass market bankingBRE, Poland (MultiBank)Established in 2001, MultiBank is a combination of traditional banking and modern banking,offering comprehensive services in the Financial Services Centers across the country. Multi-Bank’s strategy is to “continue to attract young and sophisticated clients and accompany themas their affluence increases over time remaining their bank partner for life.” As part of thebank’s plan, the IT infrastructure design is streamlined so that BRE can offer multiple servicesefficiently, by having a market leading open-architecture. Innovation Edge January 2012 | SIMPLE BANK page 30Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  31. 31. Mass market bankingCheBanca, ItalyLaunched in 2008, CheBanca is both a physical and virtual branch. It’s an innovative modelbased on client’s emotions, with the goal of providing an ideal banking experience where theprimary attributes such as security, transparency, convenience, disinterest (treated as equals),etc. Everything is geared towards the client: physical space, employees, user interfaces, andmulti-channel integration; all orientated to satisfy the clients’ needs or wants. Innovation Edge January 2012 | SIMPLE BANK page 31Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  32. 32. Mass market bankingGE Money Bank, Czech RepublicGEMB is all about service, “providing easily accessible, simple, and beneficial products and ser-vices to retail and SME clients.” GEMB’s strategy creates a “we” relationship by accompanyingclients to “do something” (task oriented) or to “ask something” (question oriented). Innovation Edge January 2012 | SIMPLE BANK page 32Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  33. 33. Virtual bankingASB Bank, New ZealandIn September 2010 ASB Bank opened its door to the world’s first virtual branch in Facebook. Custom-ers can log on to the service via Facebook and have real-time, secure conversations with ASB staff.The general manager of ASB, Anna Curzon, states, “Customers will be able to chat with our dedicatedteam about any issues - from home loan options, to simple savings tips, or how to access foreign cur-rency for an overseas trip. The Virtual Branch will be able to carry out the same services as our con-tact centre.” Initially, the virtual branch was launched to gauge customer interest. Innovation Edge January 2012 | SIMPLE BANK page 33Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  34. 34. Virtual bankingSimple, USA“Imagine, for a moment, a bank that doesn’t suck. A bank that doesn’t gouge you with fees. Abank that doesn’t treat you like crap. A bank that cares about design, but gets out of your way. …A bank that’s building a platform for the future of personal finance.“ According to Simple, “whileyour money is FDIC-insured and held with our bank partner, we provide the tools and customersupport you need to manage, understand, and automate your everyday spending and saving. Innovation Edge January 2012 | SIMPLE BANK page 34Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  35. 35. Virtual bankingBobber Interactive, USAWinner of FinovateSpring 2010 Best of Show award, Bobber “provides young adults an innova-tive FDIC‐insured payment and savings platform that combines social media and game psychol-ogy to drive user acquisition, engagement and loyalty. The company is targeting the 30 millionGen Y consumers. … Bobber will also drive opt‐in lead generation for financial institutions.” Asof December 2011, Bobber Interactive is in Beta (invite only). Innovation Edge January 2012 | SIMPLE BANK page 35Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  36. 36. Virtual bankingSmartyPig, USAOpened in 2008, SmartyPig was the first online banking application that combines Web 2.0 withsocial networking. SmartyPig allows customers to open goal-based savings accounts, earn acompetitive interest rate, invite their friends and family members to help them reach their goals,and then get the most money for their money through cash incentive and smart spending pro-grams. … SmartyPig has been deemed “Bank 2.0” by leading American financial technologyopinion makers for being the only true banking application that is social.” Innovation Edge January 2012 | SIMPLE BANK page 36Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  37. 37. the new areas of growth for banks By 2020, most of the consumers will demand retail banking products and services specifically designed to meet or exceed their Have you ever changed needs or desires your main bank? (such as mobility, social, simplicity, transparency, etc.). 36% yes The customer-centric banking experience may help the banks to explore new 7%planning opportunities. Many financial institutions are trying to move towards it. Some are 57% no doing it in different ways, but, are they effective?
 Innovation Edge January 2012 | SIMPLE BANK page 37Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  38. 38. US population by generation Percent change 2010-2020 -2% Percent change 2010-2020 -16% Percent change 2010-2020 +16% 2020 32% 29% 37% 2015 33% 37% 30% 2010 34% 45% 21% GEN X BOOMERS GEN Y Innovation Edge January 2012 | SIMPLE BANK page 38Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  39. 39. T he shift towards “customer-centric” banking is manifesting itself in differentforms and flavors. The retail banks, both tra- Demographic change and technologyditional and “de novo” types, seem to have a innovation have left apreference for physical touch points, whilethe new entrants prefer virtual touch points, visible impact on theparticularly mobile and internet. way that customersMany banks and other financial institutions interact with theirare trying to move towards a “customer-cen- banks. In a worldtric” banking experience. Some are doing it where the customersby offering eye-popping flagships; others areoffering simpler yet effective mass retail bank- has taken the control,ing experience. Are they effective? As an ana- the banks of thelyst from Jack Morton summarizes, “But is thephysical remodeling of a bank branch to emu- future must help eachlate an Apple Store, or the addition of more customer to reach hisfinancial advisers to a bank’s staff, really go-ing to be enough to adequately redefine the individual goals.customer experience at a bank branch? Or Reiterating the finding from EFMA’s Retail Fi-are these simply nothing more than stopgap nancial Services Strategic Insights and Bestmeasures and speed bumps along the way to Practices, “The vision of most banks is tobranch obsolescence? provide their customers with a seamless, ful- ly integrated and uniform experience acrossAs for virtual banking, there are also some all channels. (However) many banks are stillmajor changes as well; customers can access years away from achieving this.”comprehensive banking services 24 hours, 7days a week, and 365 days of the year. Thoughvirtual banking offers accessibility to custom- Opportunities forers, it also invites competition; as they are only Customer-Centric Banks The customer-centric bank branches mayone click away. It seems that a radical change help the banks explore new areas of growth.in paradigm is underway. Innovation Edge January 2012 | SIMPLE BANK page 39Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  40. 40. The flagships or the mass-market retail transition from a traditional Boomer orien-branches can be “living labs;” a fertile testing tated business of today to a Gen Y orientedground to explore new ways to doing busi- business of the future to ensure the surviv-ness, helping banks continue to develop and ability or sustainability of the retail businessdeliver products that delight and “wow” the by designing, developing, and executing acustomers. Also, the physical branches can sophisticated Customer-Centric bankingincrease brand awareness and equity by of- model.fering tangible and real-world experiencesof banking to customers. Potential Bumps in the road As previously mentioned, retail bankingAlso, many pundits have talked about the providers must make a smooth and (hope-changing of the guards: the decline of the fully) profitable transition from 2011 to 2020.boomers and the rise of Generation Y, with Banking providers must correctly manageGen X going where the majority goes. In re- the complete life cycle of the customers; butgards to retail banking, a study conducted must do so for three distinct generations andCisco’s Internet Business Solutions Group all at once! Who said it would be easy? As(IBSG) in February 2010, suggests that by one member of EFMA succinctly expressed,offering value propositions that satisfies the “instead of looking at the branch of the fu-banking needs of younger customers (Gen ture, banks should be looking at the future ofY or Millennials), the banks may capture the branches.”around 5 to 10 percent of additional growthby increasing the cross-selling ratios, offer- If the changing of the guards wasn’t com-ing targeted value propositions, and increas- plex enough, new technologies will continueing customer acquisition. to wreak havoc on some banking providers, especially the traditional banks; as new tech-Gen Y is going to be the biggest customer nologies and applications (such as mobile,segment for retail banks by 2020 and they social, cloud, and who knows what else) willwill demand retail banking products and force the banks to react to consumers’ ex-services specifically designed to meet or pectation. At the same time, the new tech-exceed their needs or desires (such as mo- nologies will provide “pick and shovels” tobility, social, simplicity, transparency, etc.). both current and new competitors, makingBanks must correctly manage a smooth it more difficult to “strike gold.” Innovation Edge January 2012 | SIMPLE BANK page 40Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  41. 41. In depth A list of links to other useful tools and resources that you may find useful as a supplement to the information offered on the ‘Simple Bank’ report.Books & publications Business Model Generation framework. Alex Osterwalder, 2009 IBM | 2010 Chief Executive Officer Study Booz Allen Hamilton | The Customer Centric Organization. 2004 Ernst & Young | A new era of customer expectation: Global Consumer Banking Survey 2011 PricewaterhouseCoopers | Getting to Know You: Building a Customer-Centric Business Mod-el for Retail Banks. 2011 Brett King, Bank 2.0 How customer behaviour and technology will change the future of finan-cial services “True Virtual Banking Has Arrived”. Online Banking Report, 198 (October 2011) Innovation Edge January 2012 | SIMPLE BANK page 41Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  42. 42. In depthOn the web Barclays pilots Microsoft Surface in new flagship concept branch Is It a Branch? Or a Store? It’s Deutsche Bank’s Q110 Branch experience for GE Money bank Flagship sets sail Raiffeisen Bank Zurich by NAUBanking future vision Citi - Japan Flagship Branch Prototype Commonwealth Bank - Vision for 2013, we’re improving customer service BBVA The Bank of the Future CScout Trend: Q110 in Second Life Crea International projected and developed the new concept for CheBanca! Bobber Interactive, Winner of FinovateSpring 2010 What is Smartypig? Innovation Edge January 2012 | SIMPLE BANK page 42Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  43. 43. Summaries of the most relevant news of selected topics that have been published over the course of the month based on its relevance to the Banking industry.  The summaries were prepared by the editorial board.  Further information is made available for each given topic. Trending issues Technology trends In the following section, we outline the upcoming also technologies that will change everything, with in this predictions on what may come of them issue in financial industry. Innovation Edge January 2012 | SIMPLE BANK page 43Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  44. 44. Trending issuesIn this section, readers will find summaries of the most relevant news of selected topics that have beenpublished over the course of the month based on its relevance to the Banking industry.  The summa-ries were prepared by the editorial board.  Further information is made available for each given topic.Core banking platform Crowd financeInternet irruption causes so much data in the world and Digital Marketing of brands use all forms of digitalits support is very expensive. There are some trends advertising channels A process where small amounts aresearching new ways of save money and energy. money raised for a definite purpose, Crowd finance sources funds collectively from individuals. In other words, theNew formats money comes from a wide range of individuals and notBased on design principles focused on customer insights, from a single entity. Read more about it here.New formats offers retail banking customers morechannels which are more granular and highly functional; App ecosystema consistent, simple, and collaborative universal user Nomadic uses of information are driving a new plethora ofinterface; real-time intelligent processes; highly personalized applications and a wealthy market.solutions; and is open to social networks and the web. New Gizmo eraMobile banking There are new amazing devices that will make us wiser andBanking industry is changing its appearance to the healthier.customer to make their transactions easier. Relevant newsabout mobile banking platforms (which enable customers New banking conceptsto access financial services, such as transfers, bill payments, Banks around the world continuously explore newbalance information and investment options) can be found approaches to strengthen customer relationships, bothhere. in the virtual and the physical worlds; including Virtual assistants, natural language search tools, new marketingEnterprise 2.0 tools, different segmentation (children, gen Y,…) etc. ThisBig companies are using 2.0 tools that makes section will cover news along these lines.communications easier beyond email. Join & enjoyMobile payments Gamification has become an important trending issue,Big actors are launching new mobile payment solutions and “games” are not going to be just games anymore.that will be most important than cash in a nearly future. Companies are taking this trend and using it as an essential tool.Social MediaSocial Media are becoming more specialized in Smart cities + urban mobilitydifferent areas and users begin to use them as a new Different companies from different industries are lookingcommunication channel. for business models that let them be present in the near future.Digital MarketingDigital Marketing of brands use all forms of digital Healthadvertising channels to reach consumers, including social New tools will let us take our health control and manage itmedia, via a wide range of delivery mechanisms such as in a easier way,mobile phones, sms/mms, display / banner ads, etc. Innovation Edge January 2012 | SIMPLE BANK page 44Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  45. 45. Trending issuesCore bankingplatform Centros de datos queNew formats usan chips de teléfonos inteligentesMobile banking No es ningún secreto que los centros de datos cada vez se enfrentan a mayores exigenciasEnterprise 2.0 (hay que almacenar en algún sitio todos esos 800 millones de perfiles de Facebook). No es sorprendente que las compañías queMobile payments operan estos almacenes estén preocupadas por los costes de uso de toda esa energía. En septiembre, Google anunció que susSocial Media operaciones globales usaban de forma continua 260 millones de megavatios de potencia, aproximadamente un cuarto de la energíaDigital Marketing generada por una planta de energía nuclear. Source: technologyreview | 14 noviembre 2011Crowd financeApp ecosystemNew Gizmo eraNew bankingconceptsJoin & enjoySmart cities +urban mobilityHealth Innovation Edge January 2012 | SIMPLE BANK page 45Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  46. 46. Trending issuesCore bankingplatformNew formatsMobile bankingEnterprise 2.0Mobile paymentsSocial MediaDigital Marketing Virgin Money: WhatCrowd finance Making ‘Everyone BetterApp ecosystem Off’ Means at the Branch LevelNew Gizmo era What does making “everyone better off” mean at the branch level to Virgin Money, whichNew banking yesterday agreed to acquire Northern Rock from the British government for $1.18 billion?concepts Rather, than describe it, we offer some images of Virgin Money’s current and future branches.Join & enjoy Source: Bank Innovation. November 18, 2011Smart cities +urban mobilityHealth Innovation Edge January 2012 | SIMPLE BANK page 46Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  47. 47. Trending issuesCore bankingplatformNew formatsMobile bankingEnterprise 2.0 BBVA y Bankia lanzan el pago conMobile payments tarjeta sinSocial Media firma ni pin BBVA y Bankia han lanzado un nuevoDigital Marketing servicio conjunto que permitirá al cliente realizar pagos de hasta 20 euros con tarjeta sólo con acercarlaCrowd finance a un lector y sin necesidad de firmar recibo ni teclear número pin, segúnApp ecosystem anunciaron ambas entidades. Source: EUROPA PRESSNew Gizmo era Mobile banking trends to watch outNew banking for in 2012concepts Mobile banking will continue to grow next year across a multiple fronts. Not only will more banks jumpJoin & enjoy into mobile with optimized sites and application, but financial institutions will also build their existing mobile programs with a variety of new services.Smart cities +urban mobility Source: Mobile Comerce daily, December 30, 2011Health Innovation Edge January 2012 | SIMPLE BANK page 47Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  48. 48. Trending issuesCore bankingplatformNew formatsMobile bankingEnterprise 2.0Mobile paymentsSocial MediaDigital MarketingCrowd finance Google persuades Spanish bank BBVA to use the cloudApp ecosystem The bank would use Google applications like email, calendar, docs, chat, video conferencing and other collaboration tools to “achieveNew Gizmo era a cultural change” and get “the whole company working together” across the 26 countries where BBVA is based.New banking Source: BBC News, January 11, 2012conceptsJoin & enjoySmart cities +urban mobilityHealth Innovation Edge January 2012 | SIMPLE BANK page 48Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012
  49. 49. Trending issuesCore bankingplatformNew formatsMobile bankingEnterprise 2.0Mobile payments El móvil reemplazará al pago en efectivo en 2016, según PayPal.Social Media En 2016, utilizaremos nuestros teléfonos móviles como método de pago de bienes y servicios casi en mayor medida que las comprasDigital Marketing en efectivo, con cheques o tarjetas. Así al menos lo considera PayPal, que ha publicado un informe (Money: The Digital TippingCrowd finance Point), llevado a cabo por Forrester, según el cual 45 millones de británicos utilizan ya un móvil y cerca de la mida de los 550 compradores móviles encuestados (49 por ciento) aseguran queApp ecosystem se están planteando utilizar su terminal para comprar bienes y servicios al menos una vez cada tres meses..New Gizmo era Source: IDGNew bankingconcepts Adiós Google Checkout, hola Google WalletJoin & enjoy Nuevos movimientos de la compañía líder de Internet con los que reorganizar su oferta deSmart cities + servicios online..urban mobility Source: Desarrolloweb.com, November 21, 2011Health Innovation Edge January 2012 | SIMPLE BANK page 49Disclaimer: This is confidential information for internal use only. This information must not be disclosed to any third party, must not be used for advertising and/or promotion activities and not bereproduced in whole or part unless authorized in writing by an authorized representative of BBVA group. © copyright BBVA 2012

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