Optimizing the Mobile Member Experience

Today’s credit union members expect to conduct business when they want, how they want and where they want—doing everything they can do inside their local branch quickly, easily, securely — and remotely.


Following on the heels of the evolving online banking channel, the next logical step toward optimizing the member experience is the emergence of the mobile banking channel. Credit unions that embrace this technology have the potential to grow market share through increased member satisfaction and loyalty, particularly among the coveted younger demographics. With cell phones and handheld devices becoming an integral part of every day life and business, mobile banking will only grow in popularity. In fact, research shows that 49%of people polled in a recent survey would potentially adopt mobile banking and payments as a means of conducting their financial affairs.1

This same survey also found that 70%of consumers overwhelming prefer to sign up for a mobile banking and payments service via their primary bank or credit union rather than through their cell phone provider or an alternate payment provider such as PayPal. The opportunity to market mobile services to this large segment of the consumer population should not be ignored. Today’s consumer demonstrates a high degree of loyalty to institutions that offer them choice, security and convenience — and this loyalty can translate into superior market share and increased brand awareness for the credit union. Offering members the ability to use their mobile device to check account balances, monitor credit card spending and availability, transfer funds, and receive and pay bills provides additional touch points through which to strengthen the member relationship.

Growing the Brand
The mobile channel is fertile ground for credit unions looking to enhance their brand visibility in the market. By offering both mobile and online services, the credit union makes the relationships with members ‘stickier,’ as they are far less likely to switch when their needs are being met. Contrary to initial concerns, the growing popularity of the mobile channel hasn’t been detrimental to online business. In fact, recent online bill pay transaction data shows that the mobile channel drives additional interactions with today’s consumers, who seem to be comfortable using both mobile and online financial services depending upon their needs and the situation.2 Diverting member traffic to this low cost, high impact channel is a win-win for credit unions; they meet member demand for choice and reduce operating costs simultaneously.

Research also shows that consumers who embrace the mobile option for transacting business are 83%more likely to recommend the service to their peers.3 Word-of-mouth advertising should be viewed as an incredible asset for the credit union, with a strong potential upside and virtually no marketing investment. In fact, many younger consumers today, especially those in Gen Y, are far more likely to try a service like mobile banking and payments if it is recommended by a peer than if they read about it in an advertisement.4 And the “on the go” aspect of mobile banking appeals to today’s tech-savvy consumers, who are looking for ways to simplify how they handle their finances.

The Future of Mobile Banking is Now
Mobile banking is quickly becoming a mandatory offering for financial institutions to remain competitive. Today’s consumers are more conscious than ever about balancing their busy lives, and credit unions that offer “just-in-time” content to members at their preferred touch points will strengthen their position with their members and within the markets they serve.

Convenience will always be a major factor driving consumer decisions, and mobile banking takes the “anytime, anywhere” accessibility of the Internet to a new level. Consumers can now manage their finances from virtually anywhere they have cell phone service with the same convenience and security they experience online. And for the credit union, increased adoption in the mobile channel can increase both consumer mindshare and account profitability.

Credit unions also understand the importance of targeting younger customers for a longer member relationship lifecycle. Mobile banking can serve as a key attractor for reaching the coveted 25- to 34-year old segment. By offering robust mobile services, credit unions are tapping a vast market of younger consumers who regularly use mobile devices and are more than willing to utilize mobile banking services. And by attracting these members early, the credit union has the potential to grow the relationship through college years, into marriage, mortgages, loans, savings, education plans and ultimately, retirement planning. Cultivating this member relationship early is vital to driving customer loyalty and stickiness.

By 2015, the U.S. market alone could encompass $1.85 billion to $5 billion in mobile payments related revenue.5 Credit unions that embrace the mobile banking channel today will be in a position to take advantage of this substantial revenue potential while meeting the consumer demands of tomorrow.

1 Source: “Mobile Banking and Payments Survey,” MQA Research, March 2006
2 Source: CheckFree bill pay transaction data, subscribers enrolled in online and mobile bill pay, November 2006 – February 2007
3 Source: “Mobile Banking and Payments Survey,” MQA Research, March 2006
4 Source: “MarketPlace: Young Americans,” CPGWire, Dec. 2003
5 Source: McKinsey Payments Practice




June 25, 2007



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