Abstract
Overview
This latest Javelin report outlines why SMS (Short Message Service) or text message alerts will be the real driver of adoption of the mobile channel. Building on extensive, longitudinal data, this research promotes the need to look beyond online bankers, the current target for most financial institutions' mobile banking programs, and provides preference data for alerts types that will gain traction among a wider cross-section of a financial institution' s customer base. The study concludes by demonstrating the natural evolution of SMS alerts to two-way Interactive Financial Messaging™ over the next few years that distinguishes mobile from the online channel.
Primary Questions
- Why are SMS alerts key to mobile channel adoption?
- What type of SMS alerts should FIs offer to prove the value of the mobile channel to their customers?
- Why should banks target both online and non-online bankers with SMS alerts to encourage mobile channel adoption?
- What is the next development after SMS alerts that will drive mobile adoption?
Findings and Analysis
Adoption of the mobile channel requires that banks and credit unions implement SMS alerts with the eventual goal of developing simple alerts into two-way Interactive Financial Messaging™ (IFMs™). Those institutions aiming for widespread adoption must focus on communicating the concrete, real-time benefits that SMS alerts provide instead of merely promoting the existence of a new channel. Alerts that focus on account security and fraud management are critical to consumers: “Any unusual transaction that you specify” has been the most desired alert of consumers for the past three years, with billing alerts and account change notifications tied for second. Banks and credit unions able to provide time-sensitive informational SMS alerts that affect account status will experience higher adoption of the mobile channel and give consumers the control they desire, priming them for more advanced transactions as trust and dependence on the channel increases.
Audience:
FIs: Online banking/eCommerce, mobile banking, marketing, fraud prevention, customer alerts departments; Vendors: SMS service providers, mobile banking platform providers
Table of Contents
- OVERVIEW
- PRIMARY QUESTIONS
- FINDINGS AND ANALYSIS
- SMS ALERTS REPRESENT FIRST STEP TOWARD WIDESPREAD MOBILE BANKING
ADOPTION
- PROMOTE BENEFITS OF MOBILE ALERTS, NOT THE MOBILE CHANNEL ITSELF
- OFFER SMS ALERTS THAT FOCUS ON TIME-SENSITIVE, IMMEDIATE INFORMATION NEEDS
- TARGET VARIOUS SEGMENTS WITH SMS ALERTS FOR HIGHER MOBILE PENETRATION
- NON-ONLINE BANKERS: JPMORGAN CHASE AND KIWIBANK (NZ)
- HELP LOWER INCOME CONSUMERS MANAGE FINANCES AND FRAUD THROUGH SMS ALERTS
- YOUNGER CONSUMERS ARE A PRIME TARGET FOR ROBUST SMS ALERTS USAGE
- SMS ALERTS AND INTERACTIVE FINANCIAL MESSAGINGTM PAVE THE WAY FOR
MOBILE
- A STEP BEYOND “PUSH” SMS ALERTS: INTERACTIVE FINANCIAL MESSAGING™
- APPENDICES- ADDITIONAL DATA ON ALERTS AND IFM™
- RELATED RESEARCH
Table of Figures
- Figure 1. Simplicity and Immediacy of Transaction Matrix
- Figure 2. Alerts Preferences by Type of Alert
- Figure 3. Alerts Preference by Lower-income Consumers
- Figure 4. Frequency of Receiving Alerts by 18- to 24-year-olds
- Figure 5. Assessment of SMS Alerts and IFM™ Offering through 2010
- Figure 6. Consumers Receiving Alerts within the Last Year, 2004-2007
- Figure 7. Alerts Preference by Age
- Figure 8. Usage of Alerts Within the Past year by Income
- Figure 9. Motivators for Viewing More Bills Online
- Figure 10. Preferred Additional Security Methods
- Figure 11. Prevention and Detection Model with Respect to IFM™
- Figure 12. Vendors Offering SMS Alerts and IFM™ Capability
