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- 4. WHAT WE’RE GOING TO ACCOMPLISH IN 1 HOUR KEY FEATURES In the ideal account product for millennials ACTIONABLE OPPORTUNITIESThe so-what to the key insights Channels? Positioning? Ways to waive MSC Real-time P2P Unlimited fATM transactions? 1. 2. 3. 4. 5. 1. 2. 3. 4. 5. 4
- 5. HOW WE’RE GOING TO ACCOMPLISH THAT the agenda for today 1 2 3 4 Is this list of features really the ideal suite according to what you’re hearing in your teams? Insights Roadmap Knowing the strengths and limitations of the bank, what are actionable responses to these insights? Key takeaways from research about millennials Key Features Which of these ideal features are already on the roadmap? Opportunities 5
- 6. COOL INSIGHTS JD Power’s Millennials Insight Report pulling data from 634,000 consumer responses (126,315 of which are millennials) Not as fickle or anti- establishmentas we think Millennials are flocking to the big banks customer service is critical to millennial loyalty Lowest tolerance for errors and delays of any other generation studied – they simply expect things to work getting their money’s worth millennials are most likely to make a purchase decision based on value for money, rather than buy things for status, image, or brand loyalty the concern about privacy Millennials are less concerned than other generations about privacy and are generally willing to have their information collected if it comes with benefits in the form of targeted offers and personalized services 6
- 8. COLLEGE SURVEY RESULTS 70% of customers use the app at most once every week, which shows that apps aren’t used for typical daily transactions, but mostly to check bank account balances. 9% 24% 35% 20% 20% MULTIPLE TIMES A MONTH ONCE A MONTH TWICE A YEAR ONCE A YEAR NEVER % OF CUSTOMER ANSWERS HOW OFTEN DO PEOPLE VISIT THEIR BANK’S BRANCHES 78% of customers visit ATM’s at most once a month, and 55% were Bank of America customers. Access to ATM’s may be a “perception” issue. REASONS FOR CHOOSING CURRENT BANK It's The Family Bank ATM & Branch Availability Incentives, Rewards, & Pricing Best Mobile App 8
- 10. TOP FEATURES & BENEFITS From research and competitive analysis Prospective Customer Official Customer Cross-Sell Features • MSC’s + ways to avoid it • Transaction fees • Rewards + cash back rates • Promotions + incentives • General security • Methods for managing account (online, mobile, branch service) • ATM + branch locations • Card security and liability for lost or stolen cards • Online security • Current account ease of use • New account bonuses and incentives • Interest rates/APR/APY • Packaging and bundling of services/accounts Concerns How much will I be charged? How much money will I make? Have I heard any deal breakers about this bank? How easy is it to bank here? Customer service, app ease of use, ATM availability, branches, options to manage the account How seamless has the overall experience been so far? What are the incentives opening another account here, rather than at another bank? 10
- 11. Features & Thoughts Opportunities & Next Steps • Wants easy way to avoid MSC’s + other fees • Looking for rewards + promotions + incentives • Wants a big and reliable bank • Banks ambivalently wherever friends/family bank • ____________________________________ • ____________________________________ • Family plans: the best prospects are the ones who are about to go to college • Perception is key: ATM presence, proper and targeted marketing • Offer a more engaging account opening process; like customizing credit cards • What does the apple store say about our app? • Positioning? • Channels? • ____________________________________ • ____________________________________ THE MILLENNIAL PROSPECT Deal-breakers • A slow account opening process: online or in the branches • Any bad word of mouth • ________________________________ 11
- 12. Features & Thoughts Opportunities & Actionable Next Steps • “It just has to be easy” • A younger millennial could benefit from banking basics + education (credit scores) • Wants multiple ways to conveniently manage finances (app, online banking, alerts) • P2P, account transfers, statements, pending transactions • ____________________________________ • ____________________________________ • ____________________________________ • What’s the feedback we’re getting from existing customers about the service we’re providing now? • Educational materials • Aligning benefits/rewards to the segment • ___________________________________ • ___________________________________ • ___________________________________ • ___________________________________ THE OFFICIAL CUSTOMER Deal-breakers • One bad customer service experience (where it takes 3 days for the bank to get back to the customer on an issue they had) • Problems with the app (bad first impression) • ____________________________________________________________________________________ 12
- 13. Features & Thoughts Opportunities & Next Steps • An existing customer may reach time to look into mortgages, car loans, & investment opportunities • If the experience has been seamless thus far and pricing is competitive, there is no need to move to another bank • The new product will easily be integrated • _______________________________ • _______________________________ • Help bankers more successfully pitch products to specific segments • Advisory, marketing, and educational content to promote additional products to existing customers • Use data on transactions to predict what part of life-stage a customer is in • _______________________________ • _______________________________ THE CROSS-SELL Deal-breakers • A general cross-sell pitch that is not tailored specifically to millennial needs • ___________________________________________________________________________________ 13
- 14. THE APPENDIX 14
- 15. CUSTOMER JOURNEYWhere the product features fall into place from the customer’s perspective “I need an account" Research Decision Account Opening Official Customer Prospect Customer Marketing Strategy o Access cash o Going to college o Needs to take out loans o Build credit o Banks they know about and see everywhere o Friend/family recommendation o Online reviews o Largely influenced by family and friends o WOM Online/Mobile opening o Amount of time it takes to verify account o Acceptance Rate Branch opening Hurdles o Account balance o Easy to waive charges o Account Features o Services o Support o Digital Digital Customer Experience Digital Credit Scores Real time P2P Smooth OAO Unlimited fATM Reporting lost or stolen card 15
- 16. DIGITAL CUSTOMER EXPERIENCE WHAT’S ON THE ROADMAP • We don’t have reviews on our app store, so either not many people are trying out our app, or they’ve deleted it right away and they’re not reviewing it • Prompting customers to post reviews when they have good experiences in our app or in our mobile website, and filtering them an internal review area when they don’t have good reviews We may get good reviews in industry reports, but online reviews of our bank (apple store/android store/3rd party websites) are very influential for banks that do not have a prolific established presence yet. All banks seem to have terrible online branch reviews though: Bank of America (1 star), Chase (2 stars), Bank of the West (2 stars) on mybankrate.com INSIGHTS HOW WE’RE DOING TODAY IDEAS DROP ZONE UX Usability Project Phase 1 release in September, 2016 Phase 2 release in December 16
- 17. MARKETING WHAT’S ON THE ROADMAP • Lower market recognition • We’re investing heavily into the UC Berkeley program to pilot programs that might secure the next generation of customers. • If customers are choosing banks because of their perceptions of banks, then leveraging an online presence (which is a cheaper alternative to having branches at every corner) could help win over customers • This could include Spotify or Facebook ads, etc Customers claim they choose banks based which banks family/friends use, and at how readily available ATM’s and branches are nearby. However, people do not use ATM’s as much as they claim it is important. Therefore, the perception of convenience plays a key role in how customers choose banks. INSIGHTS HOW WE’RE DOING TODAY IDEAS DROP ZONE 17
- 18. UX Usability Project Phase 1 release in September, 2016 Phase 2 release in December DIGITAL WHAT’S ON THE ROADMAP • Many things on the roadmap coming up and coming, including the Touch ID people are clamoring for • The UX Usability project includes a lot of improvements to our digital channels that customers are responding to • The digital app is becoming one of the quickest ways a customer make judgments on whether or not the bank they are with is a good one. Customers expect to get the same digital service from us that other big banks provide. Customers will also increasingly interact with banks through their mobile apps and less and less through branches and contact centers. INSIGHTS HOW WE’RE DOING TODAY IDEAS DROP ZONE Touch ID 18
- 19. BANKING EDUCATION WHAT’S ON THE ROADMAP • We don’t offer credit scores yet but it would cost us 10 cents per month per person to pull a score • We’re still uncertain as to whether or not we are already retrieving credit score information stored in EDW, that just needs to be accessed • Credit scores offered on the mobile app and on statements • Educational information wherever the scores are provided on what the scores mean and how they are used by financial institutions • Tips on how to improve your score Now that more and more banks are offering free credit scores, customers are going to have higher expectations for what a mobile app should look like. Millennials pre-first-car-loan or pre-first-refinanced- student-loan would need to start learning about credit and how that applies to their future financial decisions. Investing in this feature helps directly target millennials (though it is not limited to this segment.) INSIGHTS WHAT WE’RE DOING TODAY IDEAS DROP ZONE Nothing yet 19
- 20. REAL TIME P2P WHAT’S ON THE ROADMAP • It cost us the same amount of money to give next vs. three day transfer • We currently make $30,000 off of P2P transfers per year. Our revenue contract with our vendor splits the revenue that we get from customers in half with the vendor. Therefore, if we decide not to charge customers, the vendors will not charge us. • What will set Venmo apart from the new clearxchange network is the illusion of real-time, and the social aspect. Both of these features incentivized people to join the network. • The network though, and not the social aspect, gets people to start using the free P2P service. • Therefore, because the social aspect of Venmo largely serves as an incentive to get people on the app, other incentives like monetary giveaways should work to build the network just as well The success of providing free real-time P2P services relies largely on the network effect. INSIGHTS WHAT WE’RE DOING TODAY IDEAS DROP ZONE Q2 2017: Real-time P2P 20
- 21. SMOOTH OAOWhere we are today WHAT’S ON THE ROADMAP The current OAO takes 15-20 minutes, and it is 8 pages. Chase, our competitor, has 1-2 pages, 9 questions, and the account is opened right away. - UX Usability Project with Max Wenger - Equifax goneà Lexus Nexus, which changed 30% of account opens to 80% - Real Time Account Opening There is currently no marketing specifically aimed at getting customers to use our OAO, so maybe we could do a marketing campaign not around opening an account in the branch, but opening one online. Mitigating the risks of collecting as little information as possible, having short turnaround times in account activation, and improving efficiency around developing the most customer friendly OAO is key in acquiring future customers. INSIGHTS WHAT WE’RE DOING TODAY IDEAS DROP ZONE September 9th - UX Usability Project - CDD Reduction: getting rid of 12 questions December, 2016 - FB Linked to the process 21
- 22. UNLIMITED fATM TRANSACTIONSWhere we are today WHAT’S ON THE ROADMAP We give customers with higher balances more ATM transactions. Premier account holders get unlimited fATM transactions. If data shows that our customers don’t go to ATM’s that often, then doing a pilot offering of one free ATM a week may attract customers Depending on how often customers use ATM’s, offering “unlimited” or “one free ATM a week” may give customers the peace of mind they buy into with bigger banks INSIGHTS WHAT WE’RE DOING TODAY IDEAS DROP ZONE Data collection to validate how many free fATM transactions make sense 22
- 23. REPORTING LOST OR STOLEN CARD WHAT’S ON THE ROADMAP • We have a customer service number provided where they can call in • Freeze card temporarily button • Report lost card button, which then notifies the bank to deactivate the card, and automatically mail a new one to the customer’s address When customers rate features in level of most importance, they will normally rate features that mitigate risks as the most important features, even if that specific feature is rarely used. Customers are risk- averse. INSIGHTS HOW WE’RE DOING TODAY IDEAS DROP ZONE Nothing yet 23
- 25. MVP FEATURESCluster features by pay-off and feasibility Highlowpay-off High low feasibility CHALLENGE IMPLEMENT KILL POSSIBLE Treasure box saving P2P real time Bill Pay Report lost or stolen card Fingerprint log-in Digital features on the mobile app Checking account features Nice-to-have’s Check balance Transaction history View all accounts in a centralized area Transfer money between accounts Notifications Auto log-out Credit score Find nearest ATM Connect with customers service rep Order checks Unlimited foreign ATM transactions Low account balance to start account Family plan incentives Low fees Easy to waive monthly service charge 25
- 26. EXPECTED FEATURESCluster features by pay-off and feasibility Highlowpay-off High low feasibility CHALLENGE IMPLEMENT KILL POSSIBLE Treasure box saving P2P real time Bill Pay Report lost or stolen card Fingerprint log-in Digital features on the mobile app Checking account features Nice-to-have’s Check balance Transaction history View all accounts in a centralized area Transfer money between accounts Notifications Auto log-out Credit score Find nearest ATM Connect with customers service rep Order checks Unlimited foreign ATM transactions Low account balance to start account Family plan incentives Low fees Easy to waive monthly service charge 26
- 27. THE TAKEAWAYS Insights v Checking account products features aren’t extremely differentiated from one another, do customers have drastically different impressions of each bank? Or are they ambivalent? v A good number of consumers claim to choose their bank because of convenience, but these self-perceived preferences don’t match up with how they use the features/services. v Millennials being born digital means that they’re the group entitled and used to having everything around them work. They have a low tolerance for error, and high preference for automation. v Making everything digital is not yet the solution. Going digital while not reducing transactional friction will not add value to the user’s experience. v Transacting revolves around a set of consumer habits and preconceived notions about banking. People are used to being near ATM’s, even though they may not use one often. Therefore, customers are slow to adapt to branchless banking. This provides an opportunity to change customer perceptions and habits to match what customers actually need. v If satisfied, people retain an ambivalent attitude towards the bank they bank with Interpretation Though customers name having ATM’s available at all times as of major importance, many customers only use ATM’s once a month. Therefore, the importance of convenience is largely a matter of perception. Safety has a different connotation in millennial groups: Instead of opting for convenience, people mislabeling the reason they bank: millennials are choosing banks on the premise of safety. Big banks with enough resources to plant ATM’s and branches at every corner most likely have the capacity to protect the checking account, whereas people may have the impression that smaller banks may not be able to do that. So branches and ATM’s at every corner communicate power and safety. However, if visibility is a key component in communicating big and powerful bank, there are other opportunities to be visible and perhaps leave just as powerful as a impact in the perception of customers through the digital world. Going digital for the sake of going digital doesn’t work. Digitalization must reduce transactional friction. For example, the mobile wallet is following the trend of digitalization. However, it’s not more difficult to pull out the plastic card than to pull out a phone to pay. Therefore, though the mobile wallet is digitalization, it doesn’t quicken the transaction process and add value to the customer. Inquiries v How do customers actually choose their banks? v If choosing is largely based on the fact that they started with a family bank and never ran into issues that made them switch, how can Bank of the West influence this “arbitrary” selection? v Do people feel ambivalent to whichever bank they use? v Can customers LOVE their banks? v How much brand & product evangelism is there among customers about the banks they use? v Is there anywhere else in the banking value chain that Bank of the West create value outside of the traditional services/products provided? v Is convenience in the millennial’s own words mixed up with security? v Is the security issue to millennials different from the security issues that older generations had? v Do customers feel safer with banks if banks are more “visible”? v What is the best way to increase visibility to customers, and increase the “power feel” of a bank? v What kinds of fears/worries do millennials have around safety? Learnings, thoughts, observations 27
- 28. PERSONAS & FEATURES AND SERVICES Pre-College Student 17 years old High School Student Looking to open an account before going to college; Most likely ambivalent towards different banks What the user wants: Features and services to meet needs: A basic account where parents can deposit allowances and ATM’s nearby to withdraw money when necessary Access to ATM’s near campus Parents 45 years old Full-time worker Choosing an account that allows for monitoring for their kid; will have say in which bank the student chooses What the user wants: Features and services to meet needs: Be able to view kids accounts & make sure that their kids have convenient access to resources necessary to manage their bank account on their own • Access to ATM’s near campus • Online centralized area to see kid’s account on their log-in • An attractive family plan that offers benefits when student opens an account • Functional mobile platform that allows monitoring other accounts on the family plan • Quick and easy transfers if the student opens an account outside of the parents’ bank College Student 20 years old Almost graduated Current account has no problems, but he’s interested in investment opportunities and greater rewards What the user wants: Features and services to meet needs: Now exposed to friends with different bank accounts; better rewards, travel card options, low fees and access to ATM’s when traveling, packaged with investment opportunities • Higher rewards offered to college students • Points and rewards for traveling • Incentives to open an account if no one in your family banks with Bank of the West (chances are, no one on Berkeley campus banks at bank of the west, and so it could help to incentivizing people to switch away from their family banks) ** could be penalizing bank of the west customers though **Note: what customers perceive that they want is not necessarily representative of what they really need. Stakeholders and their expectations 28
- 33. It’s an app: Mobile Banking The checking account and other services will increasingly be perceived as an app, in the eyes of the millennial consumer. Implications - Consumers can monitor and use their accounts without ever needing to visit a teller. - Apps have a degree of social engagement involved - The value that apps add = social value + practical values from features - App loyalty… isn’t high, and the point of student/easy checking is to retain and eventually convert a customer into the signature checking account. 33