Mobile Banking: It's Not About ROI

Making a move toward mobile banking has to be strategic. But what strategies and targets should small-to-midsized financial institutions consider before deploying their mobile banking services? Tommy Sanderson, the manager of electronic delivery for Mississippi-based Renasant Bank ($4.6 billion in assets), says user preferences, security and expense should top the list.

Of premium importance is launching a mobile service that targets users' needs, Sanderson says. "My mom has probably never signed in to Internet banking," he says. "She loves the fact that she doesn't have to have a computer. She can use her cell phone and be out at the grocery store and check her available balance in just a couple of seconds."

To gain better insight into what it is consumers want, Sanderson says Renasant went to its employees. "They are the ones who are talking to the customers on a day-to-day basis," he says. "A lot of customers would come in and ask our employees about mobile banking and if Renasant planned on offering something."

In this interview, Sanderson discusses:

  • How institutions can gauge customer and member interest before launching a mobile offer;
  • Why Renasant decided against mobile banking applications;
  • And how and if mobile offers can bring returns on investment.

Sanderson has been with Renasant Bank for more than six years and served as the bank's corporate security officer as well as a project manager before moving into the electronic delivery department. As the manager of electronic delivery, a newly created position, Sanderson is responsible for the implementation, maintenance, strategic direction, security, integration and promotion of all electronic delivery products, services and communications.

Mobile Banking: Strategic Planning

TRACY KITTEN: Making the move to mobile has to be strategic, and while some institutions jump in as early adopters, others have opted for a more planned approach. What strategies and targets should small to midsized financial institutions consider before deploying their mobile banking offers?

TOMMY SANDERSON: We started looking at mobile banking a few years back, when it actually became available in the market. Just like everybody else was looking at it, trying to figure exactly where it landed within our product offering and how we would really fold that into what we were giving to customers. We just wanted to find out as much as we could about it and didn't want to jump in as soon as it popped up, because we really wanted to take a strategic look at it and figure out exactly how it would be used for customers.

KITTEN: You've described Renasant's corporate philosophy as being conservative. What obstacles or challenges did that conservative corporate philosophy pose for investments in the mobile channel?

SANDERSON: We are very conservative with what we do, but, also, we do move forward with things. We really take a step back a lot of times when we have a new initiative come up, just to really take stock of exactly what it means for our customers. Does it mean that there are new threats that could be opened up to our customers? Does it mean that our customers need to be educated about how to best use this new technology? Those are the things that we really had to step back and kind of think about. We wanted to make sure that there were no security concerns for the channel. We wanted to make sure that there was actually a desire and a need from our customers for the product, and we wanted to really weigh the text-message and mobile-browser-based solution first -- the application-based solutions. So, there were a lot of things to take in consideration for us.

Mobile Buy-in: Convincing Management

KITTEN: How has the bank approached its recently launched mobile strategy? For instance, what market or customer indicators pushed the bank's leadership, convincing them it was time to make this move into mobile?

SANDERSON: Well, actually it was not a really hard sell, once we measured our website with Google Analytics. We had gone in and looked at what kinds of devices were already accessing our site. We noticed that there was a huge uptick in mobile devices taking a look at our site and actually browsing our site, and so we already knew that we had a customer base that had a mobile device of some sort that could view our website. So what we were looking for was a way to make that safer and easier for the customers. With the solution that we went with, which is a combination of text-messaging and a mobile-browser version of our site, it really did provide our customers with an easy way to transition into mobile banking.

Weighing the Mobile Banking Options

KITTEN: There are three mobile banking options: SMS/Text, the WAP/browser-based that you mentioned and the downloadable financial applications. What methods is Renasant currently using?

SANDERSON: We currently use a text-message-based service and a mobile-browser based service. They really speak to two different groups of people. One group has the data plan on their phones, so they can browse the Internet all they want to, and they can go in and actually do a full feature mobile banking solution, which is browser-based. You know you can go in a pay bills and transfer money, and do everything you can do in Internet banking but all from your phone. Then we took the other group, which didn't have a data plan but was a group that we wanted to reach that would just have text messaging. The text-messaging service provides the current available balance for that customer, and they have to sign up for that as well. It also gives back the last three transactions that were completed on each account that you have signed up in mobile banking.

KITTEN: Is there a way to have a back and forth communication with SMS/text right now, or is it just a one-way push?

SANDERSON: It is a one-way push; and as far as I'm concerned, I am good with that. I'm not comfortable enough with the text messaging to do anything but just give a balance at this point.

Mobile Remote Deposit Capture

KITTEN: And what about plans to build on some of those mobile methods in the future?

SANDERSON: We were actually looking -- and this may be one of these things that is way out into the future -- at a number of things we've seen already advertised, at least in the Birmingham (Ala.) market, like mobile capture. That would be something that we're studying at this point -- just really trying to get down exactly what issues would be involved making sure that we make an informed decision. But I believe that is probably where we are heading, to a solution that would allow you to do all your banking on a mobile device.

Getting the Word Out: Marketing the Mobile Offer

KITTEN: To whom is Renasant marketing its mobile offer? Is it just being marketed to online banking users, and how is Renasant getting the word out to customers and the community about its mobile services?

SANDERSON: Yes, right now it's just online banking users, and we have targeted those users by using ads within Internet banking that introduce what mobile banking is and how it can provide this additional service to our customers. It's a great base to go ahead and target, because we know those users are used to looking at information online. They are comfortable with doing transactions over an online situation. So, it really limited itself very easily, to bring those customers on with mobile banking.

KITTEN: Do you think that targeting online users makes sense for smaller to mid-size institutions, rather than trying to target customers and members who may not bank online at all?

SANDERSON: I definitely do, and, like I said before, it really is an easier sell for us to get somebody involved in using mobile banking if they are already using online banking. Just as an example, my mother and father are users of mobile banking. My mom has probably never signed into Internet banking, but my dad does. So, she loves the fact that she doesn't have to have a computer. She can use her cell phone and be out at the grocery store and check her available balance in just a couple of seconds and get that information back. We are kind of crossing the lines into the people that may not totally use Internet banking, but we may be able to bring some more into the fold through mobile banking.

Mobile Security and Downloadable Apps

KITTEN: And what about the security and cost concerns? Where do you see those options, perhaps, preventing a bank from pursuing more mobile initiatives?

SANDERSON: So, one of the things that kept us from actually doing the downloadable app was the cost that was associated with. We really had no idea about what the return on investment for mobile banking was. There is really no way to charge for it, at this point, just doing an Internet banking transactions or balancing queries. So, we were not able to charge for our mobile banking and wanted to find out exactly what the usage was and how much customers were asking for downloadable apps, because a downloadable app would have been a higher cost for us. In addition to the security concerns, it was also the cost that stopped us from doing that.

Mobile: Keeping the 'Buzz' Alive

KITTEN: And over the next 12 months, what do you expect to be the greatest challenges regarding growth in Renasant's mobile banking adoption?

SANDERSON: I think the greatest challenge would just be to keep the buzz going. Really, just keeping the branches excited about the product, and we plan to use our Twitter account and Facebook, and then we have an internal blog where we talk about products. We're also going to launch an external blog to talk about products and educate the customers about all the ideas and all the new products, as well as the security concerns and the ways that you can keep yourself safe online. Really, the big thing is, we just want to keep on talking about it.

Mobile Advice? Ask Your Employees

KITTEN: And finally, I wanted to ask what advice can you offer to other banking institutions that have not yet moved forward with mobile plans?

SANDERSON: A great idea is to pull your employee base. They are the ones who are talking to the customers on a day-to-day basis. See if the customers are coming in and actually asking about mobile banking. People are really heavily advertising it in different markets, and they are really doing a good job. The other banks are doing a really good job of telling everybody about mobile banking. That is what happened to us. A lot of customers would come in and ask our employees about mobile banking and if Renasant planned on offering something. So, it really was a response to a customer desire, and I think that is really important, because there is no reason to build something and put something out there if the customers are not willing to use it.

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