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6 Reasons Why Banks Need a Financial Mobile App

DATE PUBLISHED: December 09, 2013
 

Quick, look at all the stuff that is currently surrounding you: how much of it did you "want" and how much of it did you "need?"

Those cool computer speakers are probably something you wanted.  The light on your desk?  You needed that.  That’s where marketing makes a difference. We marketers cast a powerful spell blurring the line between want and need.  financial mobile app

With the proliferation of mobile computing and social media, many small businesses find themselves confused as to what they "want" versus what they "need."  As a result, they become somewhat paralyzed with indecision and suspicion.  On one hand, this is good: they aren't wasting money on products or services with no real business value.  On the other hand, well, they're missing out on products or services with real business value.

Take the business value of having your own mobile app.  If you're a bank or a lender, is there value in providing your customers with a financial mobile app?  

We think there is, and by golly, we're going to make the case right now.  In the first of a five-part series on the benefits of having a mobile app, here are six reasons why financial institutions need a financial mobile app:

1.  Your customers (and would-be customers) are already mobile.  If, in some strange fantasy world, 80% of your customers moved 25 miles south, wouldn't you open a retail outlet to accommodate them?  Of course you would — you go to where the customers are.  And a majority of your customers are already using mobile banking apps.  Furthermore, an overwhelming majority of people don't use mobile financial apps yet but nonetheless have access to smart phones.
But don't just take our word for it.  The US Federal Reserve published an extensive study in March of 2013 on mobile phone users and how they access financial apps.  Some key findings:

  • 48 percent of smartphone owners have used mobile banking, up from 42 percent in December 2011.
  • 59 percent of the un-banked (e.g. would-be customers who don't have a bank) have access to a mobile phone, half of which are smartphones.
  • 90 percent of the under-banked (e.g. would-be customers who don't bank online yet) have access to a mobile phone, 56 percent of which are smartphones.
2.  Improved customer service.  A mobile app allows customers to do stuff anywhere at at all hours, be it making payments or checking balances.  It also enables banks to alert them when, for example, accounts are overdrawn.  Mobile computing has re-defined customer service expectations.  This is the new baseline.
3.  Learn more about customer behavior.  By having a mobile app you can, over time, surface customer behavior trends and use them to inform customers about promotions and mobile ads.  After all, according to a recent Google study, mobile-only campaigns perform 11.5% better than hybrid desktop/mobile ones.  We hate to reduce the mobile experience as yet another marketing channel, but hey, we don't make the rules.
4.  It's good for your brand.  Savvy customers expect financial institutions to offer mobile applications.  By providing them with one, it shows that your brand is sophisticated and customer-friendly.  (So don't forget to make sure the design of the app seamlessly integrates — both aesthetically and from a branding perspective — with your other customer-facing channels like your Web site and social media pages.)
5. You'll save money.  Most mobile app customers use financial apps for basic transactions — checking account balances being the most prevalent, followed by transferring funds between accounts.  With that in mind, consider this: the average cost per transaction in a branch is $4 compared to an average per transaction cost of $0.17 for online or $0.08 for mobile banking.  Do the math.
6.  If you don't, your competitors will (if they haven't already.)  Other banks have recognized the benefits of having a financial mobile app—improved customer service, new business opportunities, cost savings, etc.  These tactics are already well known to your competitors.

Stay tuned for four more posts about the benefits of using a mobile app for your financial institution!

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