Selecting and Successfully Marketing a Mobile Banking Service

Kevin Lynch, SVP eCommerce, First Mariner BankKelly Rodriguez, Director of Product Management, Fiserv

February 21, 2011

© 2011 Fiserv, Inc. or its affiliates.

U.S. Consumer Demand for Mobile Services Steadily Increasing

"U.S. banks will need to expand their thinking about mobile banking beyond 'online-banking lite' and start to view mobility as its own powerful and compelling delivery channel."

Charul Vyas, Analyst with Tower Group

Source: American Banker, July 2010

© 2011 Fiserv, Inc. or its affiliates.

Mobile Banking Forecasts

“Mobile web banking in the U.S. has grown to more than 13 million mobile subscribers – up 120 percent in just two years – and is now poised to level the playing field for the banked, unbanked, young, old, rich, poor, downtown, uptown or out-of-town.”

The Nielson Company October 2010

By 2015, 68 percent, or 128 million, of U.S. adults will own a smartphone. Smartphone owners use mobile banking at a rate more than double that of all consumers: 36 percent versus 17 percent.

Javelin Strategy & Research: 2010 Mobile Banking and Smartphone

Forecast

© 2011 Fiserv, Inc. or its affiliates.

Key Considerations for Your Mobile Strategy

Top Five Strategic Areas Business Drivers Target Markets Product Capabilities Integration Points Your Priorities

Practical Concerns Security Considerations Future Adaptability Potential for ROI

Tell Your Customers About It First Mariner Bank Case Study

© 2011 Fiserv, Inc. or its affiliates.

Top Five Strategic Questions

What are your Business Drivers? Compete with ____ or create competitive differentiation?Strengthen existing customer relationships or attract new ones?Reduce cost-to-serve by driving customer to self-service channels?Drive fee-based services?Lay the groundwork for future mobile payments?

Who are your key target markets?Existing Online Users? Smartphone Users?New customer segments (such as Youth, “balance checkers”, offline consumers)?Consumer, Business or both?

© 2011 Fiserv, Inc. or its affiliates.

Top Five Strategic Questions

What do you consider high priority capabilities?Which access methods you wanted to support first? What enrollment methods?Which transactions do you want to support day one? Phase 2? Longer term?What are your security, risk and compliance concerns?How will you manage change in the mobile space? (Device management, support burden)

Where are the important integration points to maximize user experience?What are the current systems for Online Banking, Alerts, Core and bill pay?

What are the most important factors in making a solution decision?Time to market? Consumer adoption?Total cost of ownership? Revenue generation?

© 2011 Fiserv, Inc. or its affiliates.

Questions for Your Provider

Do you support a “triple play” offering?

How do you support smartphone users?

How will you establish and monitor device management processes?

What type of enterprise support is provided, across modes? (customer care, enrollment, etc.)

How do you optimize the end user experience (across multiple devices)?

How do you deal with the question of security? (lost/discarded devices, consumer perception)

How is it integrated into other systems? (core, online banking, bill payment)

What types of marketing programs are available to drive adoption?

© 2011 Fiserv, Inc. or its affiliates.

Security Considerations

Best PracticesConsumer

Secure your phone with a PIN / Passcode Don’t provide your PIN /Password to anyone via SMS or other

mobile requests Utilize Security Alerts to get you more immediate access to

account changes and potential fraudFinancial Institution

Extend your existing security standards to the mobile channel where appropriate

Train your consumers to come to you to find Apps. Self discovery can present risk.

Encrypt any data stored on the mobile device. (Especially important as we move into payments with debit and credit data being stored on the mobile device)

Ensure that you can remotely lock a consumer’s mobile access in the cases of lost phones.

© 2011 Fiserv, Inc. or its affiliates.

Future Adaptability

What do I need to consider down the road while purchasing mobile services today?

Multiple Enrollment Methods

Prepare to offer P2P Transfer Need to be part of a larger

network

Ability to meet payment requirements as they develop

© 2011 Fiserv, Inc. or its affiliates.

A Decisive Strategy to Higher ProfitabilityAvid Mobile Users are More Profitable

© 2011 Fiserv, Inc. or its affiliates.

Tell Your Customers About ItLeverage Low Hanging Fruit as Quick Hits

Email Campaigns

Splash Pages

Website Banners

Pre-Enrollment

Electronic Statements

Targeted In Product Messaging

Marketing Mobile Money at 1st Mariner Bank

ABA National Conference for Community BankersSan Diego, CA

February 21, 2011

Kevin LynchSVP, eCommerce | Contact Center

Email: klynch@1stMarinerBank.comLinkedIn: /in/kevinplynch

http://bankingonsocialmedia.blogspot.com/Twitter/@kplynch

Presenter

• 1st Mariner Bank– Started in 1995– Largest bank located in Baltimore, 4th largest in Maryland– Assets of $1.4 billion– 22 bank branches in the Baltimore metropolitan area– 1st Mariner Mortgage, a division of the bank, is the largest local

mortgage banking business in the Baltimore/DC MSA• Emphasis is on traditional mortgage services through 14 local offices• Recently added Direct Mortgage operations in Baltimore and in

Northern Virginia• Also owns a VA Mortgage operation, including the vamortgage.com

domain, specializing in loans for military personnel

About Us

• How we got here– February, 2009- Began evaluating vendors– August, 2009- Identified three finalists:

• ClairMail• mCom/Fiserv (Mobile Money)• Mobile Money Ventures

– September, 2009- Chose the vendor– December, 2009- Received first demo– May, 2010- Finalized contract– June, 2010- Began live testing– August 26, 2010- Go Live! (FINALLY)– January, 2011- Began Marketing Campaign

Timeline

• Utilizing an interface to our Online Banking Platform, customers can access their accounts through:– Text Banking- Utilizing the Short Message Service (SMS),

they can send a text to get account balances and review their transactions. It’s a quick and easy way to get your account information when you need it.

– Mobile Browser- with internet capability, they can do all of the above plus transfer funds through any mobile browser.

• We provide them with a unique, personal URL that identifies both them and the registered mobile device.

• We take advantage of the multi-factor security features in Online Banking and present them with the same Security Image before entering their password.

– Mobile Apps- These will be available for the smart phones in February, 2011.

The Mobile Offering

Phase 1- “Soft” rollout with no marketing support

Marketing Plan

Marketing Plan

The Offer:• To encourage customers to try it, Mobile Money will be free

through the end of March, 2011. • After the promotional period, it will continue to be free if

customers meet any one of the following: – Have an eligible electronic direct deposit from an employer or government

agency. * – Maintain an average monthly balance of $1,500 in an enrolled checking

account– Complete at least one bill payment through Online Banking per month.

• If they do not meet the criteria after the promotional period, we will charge a monthly fee of $1.95.

* Qualifying deposits are limited to salary, pension, Social Security and Supplemental Security Income (SSI) benefits and other regular periodic income payments from Third Parties.

Marketing Plan

• Phase 2- Interactive Marketing– Banner ad on home page and online banking– Landing page– Email

• Phase 3- Offline Marketing– Television ad featuring Joe Flacco, QB for the

Baltimore Ravens– Branch posters for teller stations

Marketing Plan

Marketing MaterialsBanners

Marketing MaterialsLanding Page

Marketing MaterialsEmail Alert

Marketing MaterialsFlyer/Poster

© 2011 Fiserv, Inc. or its affiliates.

Questions and Answers

Kelly RodriguezKelly.rodriguez@fiserv.com

Kevin Lynchklynch@1stmarinerbank.com