Can The Banks Save Online Banking From Themselves? [Infographic]
Joshua Steimle – Contributor It’s safe to say most people don’t find online banking to be a pleasurable experience. When comparing banking experiences, conversations often tend toward comparing whose bank’s services are the “least bad.” According to The Millennial Disruption Index, the industry currently ripest for disruption is banking. The MDI reports that the nation’s leading four banks score in the top 10 for least loved brands of Millennials, and that 73% of this massive generation of customers would be more excited about innovative financial services that came from Google, Amazon, PayPal, Apple or Square, than from their banks. It seems there’s a lack of confidence in, or at least not much enthusiasm for banks among the world’s largest group of customers. According to a recent survey by TechChecks, 81% of people do their banking online (see infographic below). However, only 49% use their mobile device to interact with banks. According to Flurry Analytics, mobile use grew 76% in 2014. This means there is still ample room for mobile online banking to grow, and catering to mobile consumers should be squarely situated at the bullseye of any good online banking strategy. But banks are struggling to connect with their customers. For example, TechCheck’s survey shows that 56% of banks offer mobile deposits but 74% of customers don’t use this feature. It may well be that banks are not marketing their mobile deposit feature well enough because TechCheck’s survey also shows that many customers don’t realize mobile deposits exist as an option (29% Chase, 19% BofA, and 10% Wells Fargo). Another interesting piece of data from the survey is that only 49% of people surveyed reported using bill pay. It’s not because people are unwilling to enter into financial transactions online. Jeff Bezos announced at Amazon’s 2014 shareholder’s meeting that the company had added 30 million new customers last year bringing their overall customer base to 244 million. If customers feel comfortable entering their credit card info online to make a purchase on Amazon, why don’t they do the same with their bank, and enjoy the convenience of automated bill pay? According to the survey, paper checks are considered to be the second most secure way to make payments, trumped only by cash, so it may be that bill pay still seems risky to consumers. Perhaps Amazon has done a better job of convincing its customers it is a secure place to do business than the banks have for their own websites. Why are banks falling short? It could be bad marketing, or it may be concerns about security. The security firm Intercede recently conducted a consumer survey that found 48% of participants would not use bill payment apps, and 44% would never use online banking, period. The biggest reason for this was fear of identity theft. While this is a significant issue, one would hope that if any type of business could figure out how to provide enhanced security, it would be the banking industry. Traditionally the world of finance has been conservative, or steady and dependable. But it has come to mean staid, reluctant to adapt, and even worse–risky. When it comes to finances and technology, Millennials associate conservatism with outdated technology that is vulnerable to cyber attacks. Conversely, it’s those companies that are on the cutting edge who are seen as being the most secure. It’s time for banks to embrace the future. Banks may also be losing out when it comes to customer satisfaction because of a poor online banking experience. Millennials want interfaces that are simple, direct, highly intuitive and action-oriented. They don’t want to spend time exploring, they want to get in, take care of business, and get on with life as quickly as possible. In today’s age of real-time everything, there’s no room for slow online experiences. For example, my own bank, before allowing me to add a bill pay recipient, requires me to perform a search in order to see if the recipient already exists in their system. They never do, which makes this extra step frustrating. Having an option to skip the search would be a step in the right direction. If skipping the search were the default, with the search itself being optional, this would be the ideal. Millennials have little patience for this type of usability issue, and what might seem like a small thing to a bank can be a huge impediment to its customers. In order for customers to get onboard with banking apps, they’ve got to be quick and easy to use. According to a recent article in The Financial Brand, 46% of customers say that their banking app doesn’t always perform the way it should. It’s high time for banks to start offering reliable, quality apps that their customers want to use. Online banking is ripe for positive change. Improvements need to be made not only in the usability of online banking apps and security, but in how banking consumers are informed about these advances. Otherwise banks risk being replaced by startups like PayPal and Square which are rapidly taking over providing the services we’ve commonly associated with banks. Banks would do well to meet Millennials where they live… on their phones. A focus on adapting to the trends that Millennials favor, like mobile marketing via social media, and the creation of simple, elegant apps, as well as a continued push toward enhanced online security will help re-shape banking for the next generation of customers. Infographic courtesy of TechChecks. Joshua Steimle is the CEO of MWI, a digital marketing agency with offices in the U.S. and Hong Kong. Click here for original article.