• Thu. Dec 1st, 2022

For mobile banking, the product is the experience

ByCindy J. Daddario

May 31, 2022

When the COVID-19 pandemic caused a 30% increase in traffic from mobile devices, First Foundation Bank decided it was time to take a serious look at this channel.

“In the beginning, mobile was a secondary channel,” says Lindsay Lawrence, chief operating officer of the $10.2 billion bank based in Southern California. “Our first focus was the online banking platform, but it was fascinating to see how human behavior has changed. People now mostly live on their phones.

Recognizing how critical the mobile channel had become, First Foundation designed a new mobile app to deliver a host of benefits, from reducing branch operating costs to creating an efficient and engaging customer experience to earn their long-term loyalty. The app was launched in December.

First Foundation’s mobile initiative looks like a smart bet as customers become more comfortable with self-service banking.

According to BAI’s banking outlook for 2022, the use of mobile channels is expected to increase over the next three years, continuing a trend in place since the start of the pandemic. Online banking, mostly done on laptops and desktops, remained flat, while branch banking and drive-through services fell slightly in their share of the omnichannel mix.

“The efficiencies our customer base will gain from a powerful mobile app are so significant,” Lawrence says. “If we ship with a mobile-friendly device, the number of branch visits goes down, as well as the number of calls to the call center. This obviously helps reduce costs overall.

A clear conclusion from BAI’s banking outlook for 2022 is that mobile matters, especially for younger generations. When opening a deposit account, 37% of Gen Z respondents prefer to do so via mobile, compared to just 12% who prefer using the agency.

John Hanley, senior vice president and senior marketing director for Equity Bank, says the increase in mobile traffic caused by pandemic shutdowns in 2020 has receded. “But we’ve seen steady growth in our mobile and digital banking,” he says.

The $5 billion community bank based in Wichita, Kansas has 70 branches in Kansas, Missouri, Arkansas and Oklahoma. Hanley says the bank has struck a healthy balance between in-branch and digital business.

One of the benefits of mobile banking is that it makes it easier for customers to access anywhere in your footprint,” says Hanley. But branch bankers are still an important part of the equation.

“People continue to want help making complex financial decisions like buying a home or starting a business,” he says. “They may be starting to engage with us via mobile or digital, but our customers place great trust in our branches in case questions arise.”

Equity Bank will continue to promote and create value for its mobile channel. “We are always trying to increase the digital and mobile usage of our product line,” says Hanley. “We realize that’s how people interact with their bank, their insurance company, their phone company.”

Through Equity’s mobile app, customers can access its customer service team via text, email or phone. Hanley estimates that around 70% of Equity customers use some form of mobile or online banking.

Tom Martin, CEO of Glance Networks, says the “pandemic has left the cat out of the bag” when it comes to mobile banking. The Wakefield, Mass.-based company creates digital engagement solutions for banking and beyond.

“The pandemic has accelerated the mobile trend,” says Martin. “You have the narrowing of terms as the mobile phone has increasingly become the single point of interface. The phone never leaves the customer’s pocket. You can send messages and provide a level of engagement that exposes the customer to other parts of the bank.

The phone brings the bank to the customer. “It makes it more accessible for people who haven’t wanted to do business with a traditional bank,” says Martin. “Mobile and digital can be an enabler.”

He adds that a mobile-savvy bank meets its customers wherever they are, almost invisibly and without friction. “It is this level of invisibility that will be the new battleground for banks. Product, functionality and price are no longer the competitive differentiators in banking. It is the experience.

Edmond Lawler is a BAI Contributing Writer.

Get insights into where mobile banking is heading in “Mobile Banking is on the Move,” an executive report from BAI.