iPad in Banking: 7 Important Considerations

Shahab Choudhry | November 10, 2011 | Mobile Strategy

Banks are embracing the iPad, but are they creating the right apps?

As technology adoption goes, banks and financial services clients have been traditionally very risk averse in the adoption of new and leading edge technologies. Surprisingly, this is not the case when it comes to the adoption of the iPad in Banking. In a recent report on iPad activations in business, Good Technology, points out that more than 47% of the total iPad activations were in Financial Services. Given their aversion to taking on undue risk, this rush to adopt the iPad for use in their organizations is worth some discussion.

The realities of the post “housing bubble” world have had a big impact in shaping the strategies of the business environment for banks. After the initial wave of consolidation of some large banks that were taken over by yet larger banks, there was a period of perceived stability. This has been followed by a long period of an uncertain business environment. New regulations have been put in place to avoid a repeat of the practices that led to the financial collapse of these banks. Consumer protection regulations, such as Reg-E and Dodd-Frank, have made it difficult for banks to charge their customers certain fees for services. This has a direct impact on the top line of these banks and has left them searching for ways to replace these fees with new forms of revenue generation. The response to these strategies has been either in the form of reactive knee jerk responses like adding new fees, such as Bank of America’s announcement to charge a monthly fee for debit card usage, which was later retracted. In a day and age where consumers are see banks as a big reason for the financial collapse and are voicing their concern through platforms such as Occupy Wall Street, raising fees may not be the way to go. Other institutions have taken a more strategic path and are looking at creative ways to rebuild the relationship with their customers. The goal is to eventually monetize this trust and loyalty into a deeper more meaningful relationship that will in effect address the revenue vows. This requires out of the box thinking, including leveraging platforms like the iPad that challenges the status quo and creates new possibilities by way of new and innovative changes to the business model.

Customer Intimacy is key – The focus on knowing the customer needs to be more than just a mantra in the business. It needs to permeate the core fabric of customer interaction. This closer connection can then be turned into new revenue opportunities based on the deeper relationship with the customer. The upside from this investment in building a deeper relationship with the customer is huge. It is a lot easier to rely on strategies such as cross-selling and product bundling to increase wallet share in cases where the customer has a trusted relationship with the financial institution. Likewise increasing loyalty through effective onboarding and offering stickiness is only possible when the customers feels that the bank is able to understand their specific needs and offer them services that fit their needs.

Through our work with our clients in the banking industry, we have shown that the iPad can be a game changer in this quest to establish this deeper relationship with the customer. One excellent example of how the iPad is being used in the banking industry is the case study of Standard Chartered. This case study highlights some of the creative ways in which we believe that banks can benefit from the use of mobile devices. We believe that mobile devices in general will change the game but more importantly the iPad will be a great way to change the one-on-one customer interaction.

For financial institutions looking to adopt the iPad in overcoming some of the challenges I talk about above, I offer these 7 key considerations:
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  1. Establish goals for your iPad innovations strategy – Understand the drivers and use these to set clear goals for your iPad app innovation. Articulating what you are trying to accomplish and how you can measure the success is important to establish upfront.
  2. Draw a distinction between consumer facing self service mobile apps vs. apps that are used for scenarios involving one-on-one interaction with the customer. We believe that the later type of scenarios yield the best ROI and are the best candidates for real game changing iPad app development.
  3. Use Ideation to Think out of the box. Innovate, don’t just optimize. Challenge the status quo by getting away from just looking at current processes.
  4. Use concept generation techniques to visualize the scenarios in your iPad app portfolio. Use storyboarding, role playing and quick prototyping to envision new ways of customer interaction around your business processes.
  5. Create an immersive user experience that supports the envisioned interaction. Keep in mind that the goal is to help the customer understand the products and options that make the most sense for them. The customer does not care about the features and functions of your app. They are focused on the content. Hence the content needs to be relevant, well laid out and easy to navigate.
  6. Don’t forget to prioritize and pilot. With the innovation portfolio in place, it is important to find the “sweet spot” of apps that deliver the objectives set out in the innovation strategy. Use a few of these scenarios to create prototypes to pilot. Gather feedback from the customers in real world scenarios.
  7. Don’t lose sight of the technical and infrastructure considerations. Your applications need to be grounded in your mobility infrastructure.

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Shahab Choudhry

Shahab is a visionary thought leader and builder of successful companies that has been at the forefront of trying to make sense of the various technology shifts in the past two decades. He has advised several startups, early stage companies and Fortune 500 companies in making the most of these technology shifts. His focus has been on new products and platforms for the enterprise. His track record as a builder of companies includes IPOs, successful acquisitions as well as a failed startup. Shahab can be reached at shahab.choudhry@propelics.com or on twitter at @shahabchoudhry.

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