During a presentation at a recent financial conference, I asked a room of professionals if anyone looks at their institution's mobile banking data regularly. Unfortunately, either everyone needed another cup of coffee or no one was doing it because scarcely a hand was raised.
Nielsen research from 2014 found that 171.5 million Americans have a smartphone, eMarketer predicts that nine out of 10 digital banking users will also be mobile banking users by the end of 2018. All of this growing mobile banking usage captures an unprecedented amount of data about how customers and members want to bank.
Mobile banking, in particular, produces compelling new consumer data never before available to financial institution decision-makers. As this data hits critical mass, financial institutions are taking notice and starting to look into how data can inform their channel strategy, digital banking plans and customer engagement models. According to Accenture's 2015 Digital Banking report, the top two digital banking trends in 2015 are: 1) increased use of customer analytics and 2) expedited deployment of digital delivery.
This article provides financial institutions leaders with a primer for why and how to tap mobile analytics for growth.
1. Why analytics?
A financial institution's goals may include improving customer or member service, increasing profit, and/or increasing productivity to reduce costs. These goals lead to the formation of objectives and a strategy to execute.
Analytics is the discovery and communication of meaningful patterns in data. As a wise man once said, "However beautiful the strategy, you should occasionally look at the results." Analytics allows us to measure success against strategic goals and to refine the strategy to better attain the goals.
2. What does/does not qualify as analytics?
The most common data points that financial institutions think of in relation to mobile banking analytics today are the number of mobile banking app downloads and the number of people logging in to the app. However, these data points do not necessarily reflect analytics that drive decisions. In contrast, the following metrics when analyzed properly can provide actionable analytics to measure or improve member service, profit and productivity/cost savings.
- Growth trend lines — measures growth, adoption, active use and penetration of various mobile banking services. From a marketing perspective, they serve as indicators of whether mobile banking is stagnant or growing through adoption, and of the velocity of adoption.
- Returning number of visitors — measures loyalty and interest in the channel.
- Flow — provides visibility into how visitors move around a mobile banking app and what functions consumers are using.
- Geographic access — provides data about where mobile visitors are located.
- Service penetration — provides information to measure the success and opportunity for cross proliferation of services and cross selling in the mobile-banking channel.
- Promotions/shopping — provides marketing with intelligence about the performance of campaigns, coupons and offers and whether they provide value to the customer or member.
3. What are analytics supposed to tell us?
The purpose of analytics is to measure results at any angle. When we see the picture clearly, we can measure success against the current strategy and use information to tune the strategy further. The following is a real-world example where analytics provided a clear picture of member needs and opportunities:
For one Texas-based credit union, mobile banking analytics uncovered for the first time a geographic coverage gap and opportunity. The mobile analytics data highlighted that a large concentration of users were accessing their mobile banking app from the Dallas Fort-Worth (DFW) International Airport. The institution had no marketing, ATM or branch in the area and determined that it was a key marketing opportunity for expansion. Although the institution has relied on other analytics in the past, this was a new, untapped trend into which it did not previously have visibility.
4. When should I check analytics?
Before asking "when" to check analytics, you should ask "who" should be checking analytics and analyzing data. Marketing leaders and directors of ecommerce will likely be the most comfortable with online analytics because it's been used to evaluate marketing campaigns, online advertising, promotions, online sales and related metrics. While information technology (IT) is also a consumer of this data, their consumption may be from the perspective of the effect on uptime, app performance, and ensuring access to analytics.
Regarding when to check analytics, take a baseline as soon as possible on the key metrics outlined so that on a monthly basis the marketing leader can review and analyze data to see trends and key data points. Set up weekly or monthly email triggers from the analytics platform reminding the owner to look at the data regularly.
5. What should I do with the information?
The key to business intelligence is to keep asking questions with the data. Start simple and determine if there are any specific trends. Select a few key areas where the data suggests consumer preferences and then validate in other ways, such as through surveys or discussions with members. Consumers have a lot of opinions on how they want mobile banking to work for them. In fact, 60% of smartphone and tablet users who switch primary banks consider mobile banking capabilities as "important" or "very important" to their decision, according to Alix Partners.
Tapping into analytics requires that a financial institution is capturing analytics data in the first place. I'd start by ensuring the mobile banking solution captures data into a robust analytics platform such as Google Analytics.
Dan Chaney is the co-founder of FI-Mobile, a leading provider of digital banking solutions. Dan can be reached at Dan@FI-Mobile.com.