The Explosion of Mobile Technology; What s the Impact on the Financial Services Industry? Presented by: on Financial Services 1 A look at the state of mobile technology in 2012 on Financial Services 2 1
How Consumers are Using Mobile Mobile Marketing; What's the Impact 2011 3 Our Emphasis Today The current state of mobile technology, its future, and its impact on the financial services industry on Financial Services 4 2
Mobile as today s primary consumer device Worldwide mobile vs. PC penetration 5.3 B vs. 1.1 B ABI Research, October 2011 The U.S. has surpassed 100% per capita penetration of mobile device subscribers; we re now at 103.9%. What that means is we have more mobile subscribers than we do population (327M vs. 315M) 84% of mobile device users keep their mobile device within 10 feet of them at all times; therefore they are easily accessible by businesses Consumer use of the Internet via mobile phone has increased over 1200% in the last few years Average response rate to a mobile offer is between 12 15%; though many firms are seeing response rates exceeding 60% on Financial Services 5 More About Mobile s Importance Today 1/3 of mobile searches are tied to local 27% of U.S. mobile web users have clicked on a mobile ad Mobile coupon redemption is 10X that of traditional coupons 53% of mobile users would share their location to receive relevant ads By 2015, more than 50% of mobile users will participate in mobile banking B2B mobile marketing to grow from $26 million in 2009 to $106 million in 2014 There are 7 Billion people in the world, and 75% of them have an active mobile subscription. In 2010 the value of the mobile / wireless industry reached $1.18 Trillion dollars, a growth rate of 9% over the previous year (and far faster than the world economy and every other giant industry). The number of people using mobile devices as the only way to access the Internet is expected to increase 56 fold from 14 million in 2010 to 788 million by the end of 2015. Mobile Marketing; What's the Impact 2011 6 3
Use of Mobile Categories by Age Mobile Marketing; What's the Impact 2011 7 Use of Mobile Categories by Gender Mobile Marketing; What's the Impact 2011 8 4
Future of Mobile Technology on Financial Services 9 The Future of Mobile According to Cisco, over the next 5 years, mobile device subscriptions are expected to hit 7.1 billion. 44 billion mobile applications will be downloaded within the next five years according to ABI research 100 200 million M2M connections today; expected to grow to 1 billion within 5 years; 60 billion connected M2M devices by 2020 Gartner forecasts the total app revenue will increase to nearly $30 billion by 2013 with over 21 billion downloads. The number of free or ad funded apps will increase to 87%. By 2020, Morgan Stanley predicts that mobile devices (smartphones, tablets, car electronics, etc.) could easily top 10 billion units. By comparison, the personal computer boom of the 1990's only sold hundreds of millions of units. on Financial Services 10 5
Impact on the Financial Services Industry on Financial Services 11 Why Mobile is Important to the Financial Services Industry and to Credit Unions Specifically Studies Show: 37% of consumers at the nation s 4 biggest banks used mobile banking in the last 90 days vs. 15% at the nation s credit unions 92% of the top 25 largest banks by deposit size offer mobile banking; those that don t will lose customers to those that do Mobile banking usage is predicted to balloon from 11% of US households in 2012 to 30% by 2015 14% of the total US mobile audience accessed mobile banking services in June 2011, a 21% increase from 4 th qtr 2010 Mobile customers are younger and wealthier By 2015 almost 50% of consumers will use their mobile device for banking Use of mobile apps for banking grew 45% in first six months of 2011 52% of consumers ages 25 34 have smart phones (ComScore) on Financial Services Javelin Strategy & Research Report: 2011-2016 12 6
What Does it Mean for Credit Unions? The future of credit unions rests on their ability to provide current mobile tools and technologies to members in order to stay competitive; mobile banking is a must have Current triple play technologies (SMS, mobile web, mobile app) won t be enough; users will want to access a wallet of versatile apps with a single log on Future mobile wallet should include (without regard to phone model or carrier plan): Access to all member accounts Online bill payment Remote deposit capture Person 2 person payments Point of sale payments ecommerce tools such as couponing and gifting GPS feature to enable easy identification of closest ATM You re now competing not just with banks, but also new players in the consumer financial services ecosystem such as: Google, Apple, PayPal and more on Financial Services 13 Uses of Mobile Technology What are the options that credit unions can use to incorporate mobile into their operations and marketing strategies to benefit themselves and/or their members? on Financial Services 14 7
For Marketing on Financial Services 15 Putting Mobile Marketing in Perspective Mobile Marketing is regulated by the FCC; in the U.S. marketers cannot send messages to anyone unless they have opted in Opt out language is required to be included in all marketing messages sent When encouraging a prospect to opt in they must have a clear understanding of what they re opting in to; bait & switch tactics are dealt with severely Carriers will shut down your ability to send marketing messages if they receive SPAM complaints While 65% of e mail is SPAM, less than 10% of SMS messages are Mobile marketing is one of the most cost effective, high impact marketing mediums available when incorporated into an overall marketing strategy Mobile Marketing; What's the Impact 2011 16 8
Text Messages Have Exceptional ROI for Marketing Director of Research, Nielsen: People look at every text message they get. and 97% do so within 15 minutes 6X Higher Than Email 7.2% Email 1.2% Texting Nielsen Mobile, 2008 on Financial Services 17 Adoption The Most Common Mobile Marketing Options Applications Mobile sites Emerging as Mass Medium #1 SMS From: 244326 WagsWiskrs: Get $10 Off Dog groom & fluff Thru Fri only Richest Experience STOP to Opt out Powerful Simple 21% use 55% use 77% use on Financial Services Source: Kelsey 2009; 54.5M Mobile Web Users in 2009 18 9
Additional Marketing Options QR Codes MMS Bluetooth (short-range - 33 feet - wireless technology) Location-based Marketing Voice / IVR (interactive voice response) Mobile SEO Mobile Banner w/ Video or Audio on Financial Services 19 Want to See a Mobile Marketing Demo? SMS (Texting) Campaign Text the Keyword JOINNOW to 57711 and follow the instructions Mobile Marketing; What's the Impact 2011 20 10
For Business Use on Financial Services 21 Functionality of Mobile Technology for Credit Unions Mobile Banking Check balances Transfer funds Research transactions Located nearest ATM Make deposits from their smart phone camera Send payments Initiate money transfers Mobile phone as a debit or credit card Other Services / Capabilities Instant account opening Online loan applications Text alerts to members Online bill pay for members Money management tools for members Financial education for members Remote monitoring / reporting for credit union staff Remote system management (ATM network) on Financial Services 22 11
Mobile Technology Benefit to Credit Unions Adds to customer acquisition and retention tools Reduces call volume to call centers; reduces costs Increases customer satisfaction; lets them feel more in control of their money Less reliance on brick & mortar branches, but can still provide the branch interactive experience Increased credit union access to members 24/7 Ability to retain members even if they relocate Increases staff productivity; many tasks now requiring direct contact can be managed directly by consumers themselves with mobile technologies Mobile alerts to members receive higher rate of response than email, phone calls or direct mail Mobile marketing messages have higher ROI than other methodologies on Financial Services 23 More Benefits for Credit Unions Ability to better measure member satisfaction Ability to institute rewards based marketing programs that are easily tracked Wireless monitoring of security systems (online and brick & mortar locations) Increased tracking ability of member transactions; trends identification to enable targeted marketing options on Financial Services 24 12
What About Apps? on Financial Services 25 Putting the Mobile App Market in Perspective As of December 2011, more than 950,000+ apps are available 8 out of 10 apps are free By 2011, more than 10 billion app downloads were made JUST FROM THE iphone STORE (Localytics) Gartner forecasts the total app revenue will increase to nearly $30 billion by 2013 with over 21 billion downloads. The number of free or ad funded apps will increase to 87%. U.S. is the only country so focused on Apps; this is expected to change by 2013 with more focus on mobile web (like the rest of the world) Apps need to be marketed outside of the app stores on Financial Services 26 13
The App Marketplace App store size total number of applications Apple 520,000+ Android 300,000+ GetJar 150,000 Ovi (Nokia) 6,118 BlackBerry 4,756 Palm 1,452 Windows 693 Average price for all paid apps Apple $3.62 BlackBerry $8.26 Android $3.27 Ovi (Nokia) $3.47 Palm $2.53 Windows $6.99 Other App stores Carrier-specific app stores 3 rd party stores such as GetJar, Handango, Amazon, Windows, etc. on Financial Services 27 App Statistics 1 in 4 downloaded apps is never used again On average, U.S. feature phone users have 10 apps, U.S. smartphone users have 22 apps (iphone users have the most with 37) Most used apps across all U.S. smartphones are: Facebook Google Maps The Weather Channel The Facebook app has been download 100 million times from GetJar; it is the most downloaded app from any app store It is projected that when app revenue reaches $38 billion by 2015, Apple will have only 20% of the market share on Financial Services 28 14
Michigan and Mobile Technology What role does mobile technology currently play in Michigan, and what will be the industry s impact on the economy? on Financial Services 29 Mobile in Michigan on Financial Services 30 15
The future of Mobile in Michigan The mobile / wireless industry has a very high Jobs Creation Factor of 3.9; this factor is one of very few comparable to the state s manufacturing industry. This means: 1 mobile job created = 3.9 additional non mobile jobs Our Growth Projections 9,250 new mobile / wireless industry jobs in Michigan by 2015 Resulting in over 35,000 non mobile industry jobs in the state, and over $1.7 billion in resident earnings We will increase market penetration to the equivalent of that in the U.S., 103.9% currently, and higher as the industry grows on Financial Services 31 QR Code / Mobile Website To scan this QR code, you will need a free QR reader, which you can download from your smart-phone s app store. on Financial Services 32 16
Today s Presenter: Linda Daichendt Founder, Mobile Technology Association of Michigan (MTAM) A Michigan based trade association for the mobile industry Co founder Mobile Monday Michigan A networking organization for those interested in Mobile Technology Co host, The Mobile Marketing Review A podcast series about the international Mobile Marketing industry CEO, Strategic Growth Concepts A marketing / management consulting firm Phone: (248) 470-3257 and twitter.com/mtamlinda on Financial Services 33 17