As banks begin to explore offering services via mobile devices, they have a number of vendors and services to choose from as they decide what might best appeal to their customers.
In the case of California-based Bank of Stockton, mobile banking is seen simply as another delivery channel for services, and one that might help the bank draw a younger demographic. The bank, which will celebrate its 140th anniversary this fall, has established what Angela Brusa, VP and director of marketing for the bank, described as a “long-established customer base.”
Mobile skews younger
“We have not aggressively pursued the younger demographic,” Brusa acknowledged. She noted that Bank of Stockton does not offer free checking, which is commonly used to appeal to young users, and has higher balance requirements than peer banks.
The addition of mobile banking could “possible appeal to a younger market segment moving forward with this, packaging it with some pricing strategies to appeal to the younger market segment,” Brusa said. “For us, mobile banking-if it does indeed appeal to the younger market-will maybe breathe some life into bringing that segment into our banks.”
“I think the most difficult part will be educating consumers on mobile banking, because it’s so new,” Brusa added. She noted that Bank of Stockton had virtually no case studies of mobile banking on which to base its decision, and “we’re charting some new territory here.”
The bank opted to go with a messaging-based system of mobile banking provided by ClairMail Inc., rather than a downloadable application model that other financial institutions have embraced. Michael Savelli, chief administrative officer for Bank of Stockton said the bank chose the messaging-based model because it appeals to a broad segment of customers due to being more easily accessible.
Intense customers
“I see mobile banking appealing to what I would call a relatively modest group of very intense customers,” Savelli said. “There’s going to be a group of very mobile, active customers who are going to demand the product, but we don’t see every customer demanding it.”
Also, Savelli added, he doesn’t expect to see a dramatic change in branch traffic due to use of mobile for banking transactions. People thought that automatic teller machines would prompt a drastic shift in branch traffic, he noted-yet the fundamental traffic pattern did not change.
“As new technologies get introduced, the question resurfaces: Is this going to replace or significantly alter other delivery channels, including the bank branch?” Savelli said. “My position on this is, no, it’s not going to change traffic patterns in branches, it’s not going to change usage patterns at the branches, it’s not going to significantly alter the behavioral pattern of Internet banking customers. It’s simply an additional choice for customers to access the bank, and that’s what we’re about.”
