Bank of America: Mobile Banking (Abridged)
Mobile Banking Case Studies
October, 2010
Copyright © 2010
All Rights Reserved..
Understanding the economics of mobile banking through a series of case studies
Background, purpose, methodology
Ten case studies of implementations of mobile banking were researched, with a particular focus – where possible – on the economics of these implementations, enabling a better understanding of the potential for gain, the business case, and the attributes of successful implementations. The case studies were developed by TowerGroup using a data request followed by an in-depth telephone interview with the appropriate bank executive; finally, banks were asked to validate all information in the case study and provide their approval for release. The period of interviews were from July to September 2010.
Banks and executives agreed to participate on condition of the case studies being blinded.
Copyright © 2010 All Rights Reserved.
2
Key observations from the study
1.
Mobile banking investments have very high ROIs – into the multiple hundreds of percent – when largely successful (by way of customer impact, cost, adoption.) There is a fall-off in the performance of lesssuccessful implementations, which potentially have negative ROIs when adoption is very low.
2.
Measurement matters – the most advanced banks in mobile generally had the best sense of mobile’s effect on customer behavior:
•
•
•
3.
Measuring outcomes is the key to the development of impactful future initiatives;
Measurement enables stakeholdering, which avoids the risk of mobile being seen as cost-only or generating pressure to generate revenues from mobile banking fees (which ultimately stifle usage.)
Channel economics are important, but understanding the economic impact on the entire customer relationship is critical; Minimizing fees drive greater engagement from customers, which will be critical for future opportunity capture: • Cross-selling of
October, 2010
Copyright © 2010
All Rights Reserved..
Understanding the economics of mobile banking through a series of case studies
Background, purpose, methodology
Ten case studies of implementations of mobile banking were researched, with a particular focus – where possible – on the economics of these implementations, enabling a better understanding of the potential for gain, the business case, and the attributes of successful implementations. The case studies were developed by TowerGroup using a data request followed by an in-depth telephone interview with the appropriate bank executive; finally, banks were asked to validate all information in the case study and provide their approval for release. The period of interviews were from July to September 2010.
Banks and executives agreed to participate on condition of the case studies being blinded.
Copyright © 2010 All Rights Reserved.
2
Key observations from the study
1.
Mobile banking investments have very high ROIs – into the multiple hundreds of percent – when largely successful (by way of customer impact, cost, adoption.) There is a fall-off in the performance of lesssuccessful implementations, which potentially have negative ROIs when adoption is very low.
2.
Measurement matters – the most advanced banks in mobile generally had the best sense of mobile’s effect on customer behavior:
•
•
•
3.
Measuring outcomes is the key to the development of impactful future initiatives;
Measurement enables stakeholdering, which avoids the risk of mobile being seen as cost-only or generating pressure to generate revenues from mobile banking fees (which ultimately stifle usage.)
Channel economics are important, but understanding the economic impact on the entire customer relationship is critical; Minimizing fees drive greater engagement from customers, which will be critical for future opportunity capture: • Cross-selling of