'Net News Newsletter

Analytics Needed to Drive New Accounts
The majority of financial services product searches begin on the web, yet numerous credit unions and banks have not adjusted their website to take advantage of this new reality. Amazon.com has been extremely successful in online product sales. A quick comparison of their website to the average financial institution shows a stark contrast. Many financial institutions emphasize commodity features on their site and focus on the look and feel. Amazon.com focuses on driving high volume to their website and converting the traffic into product sales. Amazon.com drives sales by using analytics to provide consumers with more personalized product offers. One leading bank was able to follow Amazon.com's example and increased their conversions by 30% through personalized product offers.
Source: Bank Systems & Technology, August 11, 2010

Put Web at Heart of Multichannel Strategy
Credit unions and banks can best respond to consumers changing channel preferences with a coordinated multichannel approach that puts the web at the heart of the strategy. The number of consumers using online banking continues to grow, representing 59% of adults today. Yet consumers have not completely given up using other channels, more than 2/3 of consumers use multiple channels to interact with their financial institution in a year. "eBusiness and channel strategy leaders should organize to support these multichannel bankers by right-channeling customer interactions and putting the Web at the heart of their multichannel strategy," writes Emmett Higdon from Forrester Research. Financial institutions can use the web to collect email addresses for e-statement delivery and phone numbers for text message alerts. E-statements allow institutions to save printing and postage costs each month, while alerts increase consumer satisfaction.
Source: Forrester Research, July 26, 2010

Efficiency Opportunity in Receiving Online Banking Payments
As bill payments through online banking continue to grow, credit unions and banks can cut costs by accepting payments to their own loan accounts electronically. While most credit unions and banks allow their consumers to initiate online bill payments through their website, many financial institutions receive these payments as a paper check. Institutions could receive loan payments from hundreds of different financial institutions each month. When these payments are sent through an electronic lockbox they cost the institution less and arrive faster than when the online bill pay vendor prints and mails a check to cover the loan payment.
Source: Digital Transactions News, August 20, 2010

More Reasons to Launch Mobile Banking
Mobile phones made several steps towards becoming consumers' wallets in recent weeks; credit unions and banks can begin to prepare for mobile point of sale payments by launching mobile account access to consumers. Major companies are working to allow consumers to make payments from their mobile phone. AT&T, Verizon and T-Mobile are partnering with Discover and Barclays to allow consumers to make payments at stores by holding their mobile phones up to payment terminals. Apple has filed for a patent on consumers making payments with their iPhone or iPod. In September, Bank of America and Visa will begin testing a service that allows consumers to use their smart phones to make purchases in stores. While not every financial institution has the resources to test mobile point of sale payments, they can begin dipping their toes into mobile by deploying mobile account access to consumers. Launching mobile banking will help financial institutions build experience in mobile financial services while getting their consumers to begin thinking that their mobile phone could be used for managing their finances.
Source: Wall Street Journal, August 3, 2010

eCommerce Orgs Serve Two Masters
Credit unions' and banks' eCommerce teams should report to marketing and IT. eCommerce is a channel for consumer interaction and an enterprise function. Brad Strothkamp from Forrester Research explains, "Nobody would argue that the ATM is a servicing channel and not an enterprise function like corporate marketing. On the flip side, nobody would consider corporate marketing a channel versus an enterprise function, which it is, but eBusiness fills both roles in most financial service companies. It is a servicing channel for existing customers looking to service their accounts, but it also has a marketing and sales enterprise function along the lines of corporate marketing." Serving this dual role of channel and enterprise function makes it imperative for the eCommerce team to have strong connections throughout the financial institution.
Source: Forrester Research, July 28, 2010