Overview of Mobile Industry, Market Trends, and Relevance to Online Banking and Financial Servcies.

1. Promoting growth through direct banking: anywhere,
anytime, and device.
by Chris Smith
General Manager, Digital
Direct Banking, NAB
chris.x.smith@nab.com.au
23 August 2010

2. NAB Multi-channel Approach
Create Customer Benefit -> Build Value Proposition -> Create Capability -> Drive Shareholder Value

3. Mobile @ NAB
• Five Key Trends
• Strategies for success
• Recommendations

4. Predictions
“Within 5 years the Mobile
Channel will become the
most significant channel
for the banking industry”
However: we all know the problem with predictions…
“I think there’s maybe a
world market for 5
computers”
Thomas Watson,
Chairman IBM (1943)

5. Trends: Mobile Internet Outpaces Adoption of Desktop Internet
Source: Morgan Stanley, Economy + Internet Trends, October 09

6. Trends: Mobile as a subset of online?
DOES THE FUTURE LOOK LIKE THIS?
• Capability and usage of mobile devices will equal that of PC.
Traditional thinking held that this convergence would result in the
mobile internet becoming a subset of the traditional internet.
Online
• However there are a number of factors , unique to mobile devices that
deliver MORE capability than desktop/tethered devices.
• Capabilities such as GPS, personalisation, messaging, presence, Mobile
device intimacy (always with you), presence and context, app stores,
contactless billing mean that RICHER interactions are possible with
mobile devices than desktop devices.
OR THIS?
• Gartner has forecast that by 2013 more internet usage will be from
mobile devices than non-mobiles.
• Recent study from global media agency Initiative showed that 60% of Mobile
mobile internet activity occurred INSIDE the home.
• Features added to online should be added to mobile as well if cost
effective and appropriate to user experience. However mobile-led Online
feature enhancements (ie those which don’t apply to online) will also
be critical

7. Trends: Moore’s Law: Computing speed doubles every two years
iMac – 2000 iPhone 4 - 2010
Processor 500 MHz 1GHz
Memory 128MB 512MB
Graphics capability 8 million triangles per second 28 million triangles per second
Screen resolution 786k pixels 614K pixels
Max data transfer rate 12.5MB/s 20MB/s
Storage 30GB HD 32GB Flash Drive
Size 38.1cm x 38.1cm x 43.4cm 11.4cmx 5.9cm x 0.8cm
Weight 15.8kg 0.08kg
Camera No 5 Mega Pixel still/video
GPS No Yes
Phone No Yes
Compass No Yes
Accelerometer No Yes
Apps “Shrink-wrapped”software 225,000+ in App Store
Downloads of these apps N/A 5,000,000,000+ since 10 July 2008
10 years is not a long time in banking – but it’s a heck of a long time in digital media usage.

8. Trends: Social Media is Mainstream
Source: Morgan Stanley, Internet Trends, June 2010

9. Trends: Social Media is Mainstream
• Social Media is now mainstream – in fact it’s beyond the
mainstream.
• If Facebook were a country it would be the third largest in
the world – behind only China and India.
• Facebook is targeting >1bn users in next 12-18mths, and
mobile is likely to be a key factor in delivering this growth.
• 50% of Facebook users are aged 35+
• Australia leads the world in Social Media use. In December
09 the average Australian spent almost six hours on social
media sites.
• 29% of all time spent by Australian’s on the internet is spent
on Facebook.
• 60% of mobile internet usage in the US is spent on social
media sites – only 9% on carrier portals.
Mobile customers are also social media customers. They are vocal about their customer
experience to their network.

10. Trends: Fragmentation vs Consolidation
• Multitude of systems in use. They include iPhone,
Android, BlackBerry, Symbian, Windows Mobile.
• There is no interoperability between these platforms
for “native” applications.
• Developers are torn between supporting all of these
platforms to offer the best consumer experience
possible
• This causes problems in the medium term, however
this is a cyclical issue
• Web developers experienced the same issue in the
mid-90s with browsers (Netscape vs IE)
A clearly articulated Device Management Strategy is vital to the ongoing
success of mobile implementations.

11. Trends: Mobile Advertising is experiencing rapid growth
Source: Sensis, January 2010

12. Mobile Banking: Ten Strategic Reasons for Making Banking Investments
Top Ten Reasons
— Improve Brand Image
— Increase debit/credit card usage
— Improve your market share
— Displace telephone calls
— Reach customers in real-time
— Improve overall banking experience
— Save customers money while
shopping in retail stores
— Help customers evaluate big-ticket
items
— Enable person to person payments
— Support specific business lines
Source: Online Banking Report, no. 177, March 2010

13. Mobile Banking: Ensuring success for mobile initiatives
• Establish a framework for measuring • Be an evangelist
economic contribution — Use the excitement generated by rapidly
— Establish a framework or proxy that changing environment to communicate the
allows you to demonstrate how the benefits your team is delivering
advances you are making today will
deliver tangible and meaningful benefits
to the bank when usage reaches critical
mass.
• Set clear targets and communicate
your success
— Ensure that the targets and deliverables
you set as a result of initial funding are
measurable, achievable and able to be
communicated.
• Link to strategy
— Be able to communicate how each of the
projects that is funded links directly to
the BU strategy

14. Final thoughts
• Mobile channel is a critical element and unique element of a multi-channel strategy
• Mobile internet is more than the computer unwired
— What are the possibilities for interaction with your customers in this paradigm
• Technology is driving rapid change, but not unmanageable change
— As per the comparison between the iPhone today and the iMac in 2000 – things are
moving fast
• New paradigms = new business models
— The fact that mobility is more than “unwired” means that there are new modes of
transaction that simply may not have made sense in the past.
• Exciting future ahead, but initiatives must be grounded to strategic and commercial
drivers to fulfill multi-channel vision.