Twitter
Andrew Davidson 
Susan Menke 
Susan Wolfe 
Lisa Hronek Posts Tagged ‘incentives’
More predictions for the banking industry in 2010
With the turn of the New Year and news about potential banking legislation, I’ve been thinking about how the banking industry will change this year. We just put out a press release with five of my predictions, but here are some more things I’ve been thinking about for banking in 2010:
Prepaid cards could be a good alternative to checking accounts
The prepaid industry claims that, for some lower-income consumers, prepaid cards can be cheaper than traditional bank accounts with overdraft protection. This will certainly be true if banks begin to institute monthly fees or fees for bill payments and other types of transactions that are currently free. In a sign that there is more interest in prepaid cards, MasterCard reported it is looking at ways to market prepaid cards to the affluent.
Banks will seek to create “financially literate” customers
Much has been said about how the ongoing economic situation was caused—in part—by a lack of consumer knowledge about financial matters. The “Great Recession” been a wake-up call for every generation. According to Mintel consumer surveys, each generation is reacting differently, but young Echo Boomers have a strong desire to learn more about financial matters. Wells Fargo is tapping into this with its Virtual Island on Facebook.
Mobile banking is here to stay
The success and ubiquity of smart phones is driving banks and investment firms to develop applications that allow mobile banking and payments. User demand will be the reason that mobile banking succeeds. With teenagers and young adults relying on their phones in ways never imagined, mobile banking will become an expected service for the younger generations. At the same time, banks must carefully consider how they’ll engage mobile banking customers to ensure a long-term relationship.
Banks will begin to figure out social networking
Banks have struggled with how to embrace social networking sites such as Twitter, Facebook and You Tube, but 2010 will see them finding new and better ways to get involved. Jwaala, for example, recently announced technology that allows customers to receive alerts through social networking sites rather than through email.
Overall however, 2010 won’t be about financial services companies setting up pages and groups on social networking sites. Instead, banks will start developing applications for use in social media and creating a presence that says something about their brand. They will begin to use social media to network with new groups of customers.
Free webinar Thursday: Navigating the CARD Act
A bit of shameless self-promotion this week. I’ve got a webinar coming up on Thursday, December 17th. It’s free, the content is valuable, and I’d love it if you could attend.
“Navigating the CARD Act: Evolving Acquisition Strategies”
The CARD Act’s regulations go into effect in just a few short weeks, so I’m going to explore its implications on the credit card industry. We’ve already seen issuers respond with new direct marketing campaigns and strategies, and we expect even more innovation next year. Join me to look at what’s happening now, what will happen in 2010 and which specific challenges will still face the nation’s leading card issuers.
1% mortgage cash back from Chase, direct mail
An incentive just for having (and paying, of course) a mortgage? Well that’s one way to make today’s dim economic picture a little brighter. In August, Chase announced a new program offering 1% cash back on mortgages held by Chase checking account customers. We started seeing offers for this appear in direct mail in October.
Mortgage incentives aren’t new, but an on-going cash back program is something we haven’t seen before. “Chase Exclusives”, which the 1% cash back program is part of, rewards checking customers for using other Chase products. It’s a great loyalty builder; tapping into the ongoing consumer need to get more for less and really delivering on the promise of an “incentive” for working with Chase.
Customers receive the 1% cash back if they follow certain criteria on new or existing Chase checking accounts. They can receive the rebate either in cash or apply it towards the mortgage principle.
Is 1% back enough to prompt mortgage-holders to refinance with Chase, especially with lending standards tightened? How else can financial institutions innovate to get more out of the customers they have?