Three Things You Dont Know

Why They Matter & What to Do Next Lee Wetherington, AAP

Director of Strategic Insight ProfitStars
June 18, 2011

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2011 Jack Henry & Associates, Inc. All Rights Reserved.

@leewetherington

Presenter

Lee Wetherington
Director of Strategic Insight

Develops actionable insight and strategy for the financial services industry Delivers keynotes nationwide

Serves as the Technology Faculty Chair for several regional banking schools
Published in many industry trades Degrees in Economics and English from Duke University Accredited ACH Professional (AAP)
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@leewetherington

Macro Trends

Pace of Change/Convergence
Reaching 50 million users
Radio 38 Years TV 13 Years Cable 10 Years Digital Camera 8 Years

Internet 4 Years

Smart Phone 2 Years

FaceBook Last 6 Months

Challenges of Convergence

1. Usability 2. Security 3. Saturation

Our 100,000 Words a Day

Data Overload: Americans in the Digital Age by Bill Morris; www.sphere.com; 12/16/2009

Too Many Choices

How much is simplicity worth?

Bank Customers Say Make It Simple Well Pay You For It American Banker; March 16, 2011; By Heather Landy

U.S. consumers will pay a 4% premium for simplicity.

--Siegel+Gale

What Consumers Want

1.Security 2.Personalized experiences 3.Proactive communication

What Businesses Want

1.Ease 2.Control 3.Cost Reduction

What Financial Institutions Want

What Governments Want

1. Efficiency 2. Cost reduction (without massive capital outlays upfront) 3. Better collections/distributions 4. Improved service for constituents

Agenda 3 Things You Should Know

Online; Mobile; Social

What You Should Do Next

Prioritize Usability Mobile Moves Simplify & Nudge

The Future
One App Everywhere

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The online channel rules.

Transaction Costs by Channel

Fiserv White Paper: How to Achieve a Compelling ROI from Mobile Financial Services ; www.checkfree.com

How do you capitalize upon the online/mobile channels?

Improve self-service
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Improve Self-Directed Service

Usability, usability, usability

Easy to find
Easy to use Visualize data

One-step enrollments (email/online)

Online live chat/support

Mobile alerts/services
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Mobile: Cost Savings/Call Deflection

Preemptive text alerts can prevent In-Person Customer Calls
Bank cost: $3.00 to $15.00

Automated Calls (IVR)

Bank cost: 3 to 30

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How can we make digital more concrete?

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Countering the Abstraction of $

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Visualizing Data

A Better Balance

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Question:

Where does everyone gather online?

More Time Spent on Facebook

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http://www.businessinsider.com/chart-of-the-day-time-spent-facebook-google-yahoo-aol-microsoft-2011-2

Social Media Roundup

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http://blog.socialware.com/2011/02/06/2010-social-media-financial-services-a-look-back/

The Link Between SMO & SEO

To be easy to find, you must top search rank To top search rank, you need real site traffic To get real site traffic, you must tap into social networks

Social Media: 2 Questions

1. Privy to conversations about your organization? 2. Party to conversations about your organization?

The Bottom Line: Social Media

Build trust first, sell later

Youll be more successful Eliminates most compliance burdens

Be personal, not institutional Be responsive and contribute regularly Welcome feedback, even criticism, to build respect, trust and brand Tremendous benefits, little costs

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By the end of the year, over 50% of all U.S. mobile phones will be smartphones.

Experience/Expectations

Smartphone Marketshare

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www.marketcharts.com

Mobile phones will be most common device used for browsing the web by 2013!
http://www.engadget.com/2010/01/15/gartner-forecasts-phones-overtaking-pcsas-most-common-web-brows?icid=sphere_blogsmith_inpage_engadget

Smartphone Marketshare

40

www.marketcharts.com

Usability First

Its not what, its how

By the way, why are mobile devices getting bigger?

Mobile Payments
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2011 Jack Henry & Associates, Inc. All Rights Reserved.

Mobile Payments Projections

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SOURCE: Aite Group William Mills Bankers As Buyers 2011

Mobile Payments Coming?

AT&T, Verizon, T-Mobile, and Discover form Isis mobile-payments venture Verifone buys Hypercom

Verifone announces all new POS terminals will be NFC capable

Verifone/Google team on mobile payments Verifone attacks Square Lee soils pants with excitement

Mobile Card Acceptance VeriFones PAYware Mobile Intuit GoPayment Square North American Bancards Pay Anywhere

Ingenico
Sage Mobile Payments (no transx fees!)
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VeriFone Quietly Shifts PayWare Mobile Pricing American Banker ; ebruary 14, 2011; By Kevin Woodward

VeriFone PAYware Mobile

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http://www.paywaremobile.com

VeriFone PAYware Mobile

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http://www.paywaremobile.com

VeriFone PAYware Mobile

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http://www.paywaremobile.com

Pricing: VeriFone PAYware Mobile

Low-volume (<1500 transx/month)
2.75% plus 15, no monthly fee. $99 for card reader (retails for $149.95)

High-volume (>1500 transx/month)

1.65% plus 20, $19.99 monthly fee Free card reader w/ 2-year commitment, but $29 activation fee

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VeriFone Quietly Shifts PayWare Mobile Pricing American Banker ; ebruary 14, 2011; By Kevin Woodward

Intuit GoPayment: Mobile Payments

http://intuit-gopayment.com
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Intuit GoPayment: Mobile Payments

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http://intuit-gopayment.com

Intuits GoPayment

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http://intuit-gopayment.com

Finger Signature: Intuit GoPayment

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http://intuit-gopayment.com

Pricing: Intuit GoPayment

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http://intuit-gopayment.com

www.squareup.com

Mobile: Credit Card Terminal

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iPad: Card Terminal

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Mobile Security
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2011 Jack Henry & Associates, Inc. All Rights Reserved.

Smartphones are mobile PCs.

DroidDream
Google pulls 60+ malware apps from Android Market Exploit code breaks out of Android app sandbox Roots phone and sends sensitive info to remote server
Google yanks over 50 infected apps from Android Market By Gregg Keizer; www.computerworld.com March 2, 2011 01:08 PM ET

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Whats the biggest mobile phone risk?

Losing it!

How long to realize a card is lost/stolen?

How long to realize a mobile phone is lost/stolen?

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Demographics
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Who is Gen Y?

Gen Y

largest demographic.
income will surpass both Gen X and Boomers within 10 years. 1 in 5 switched FIs in the last 12 months (vs. 13% of all consumers)

Judge FIs by quality and extent of online and mobile services.

Javelins Gen Y: How to Engage and Service the New Mobile Generation; April 2011

Smartphone Ownership by Age

Source: Javelins 2010 Mobile Banking Behaviors: Fewer Handsets in the U.S., yet Smartphone Growth Exceeds Expectations; June 2010

Gen Y: Frequent Mobile Bankers

Source: Javelins 2010 Mobile Banking Behaviors: Fewer Handsets in the U.S., yet Smartphone Growth Exceeds Expectations; June 2010

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Gen Y Trusts Social Networks

Javelin Study: Social Media and Banking: Financial Brand Opportunity, Risk or Complete Waste of Time?; March 2009

Gen Y likes prepaid.

Gen Y Uses Prepaid

16%

Prepaid card or payroll card usable anywhere Gen Y (1979-1999) 11% All consumers

0%

5%

10% Percent of Consumers by Segment

15%

20%

Q1. Do you personally have any of the following financial or payments products? Other options available.
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September 2010, n= 1,133, 4,998 Base: All Gen Y consumers; All consumers. 2011 Javelin Strategy & Research

What to Do Next

Saturation: The Remedy

1.Simplify 2.Nudge

The Future

How can you be everywhere your constituents want you to be?

One App, All Platforms

Lee Wetherington, AAP

lwetherington@profitstars.com
http://discover.profitstars.com/leewetherington

http://twitter.com/leewetherington

http://www.linkedin.com/in/leewetherington