Enhance the Member Experience with Specialty Apps

By Kent Zimmer07.10.2017

Did you know people would rather lose their wallets than their smartphones? That’s what the Ponemon Institute learned when it surveyed more than 700 consumers last year. It isn’t surprising; in recent years, numerous studies have reported a dramatic increase in smartphone usage among all demographics.

A January 2017 report from the Pew Research Center found that 95% of U.S. adults now have mobile phones, 77% of which are smartphones. Compare that with 35% who used smartphones in 2011. Further, roughly half of American adults use some form of tablet. Consumers expect to be able to use their digital devices for almost anything today; and while mobile banking has lagged other applications, it’s on the rise. In 2015, the Pew Research Center reported that more than half of smartphone owners use mobile banking apps.

More recently, Ipsos did a study for the American Bankers Association, finding that 58% of U.S. adults use mobile banking at least once a month; 37% use it at least three times a month. Not only is digital technology a growing part of daily life, but so is the mobile banking digital made possible. Your members expect you to offer it – but more than that, they expect it to work as well as any other app they use.

Moving Beyond the Basics

A few years ago, just offering mobile banking was enough for consumers who wanted to manage their accounts on their own timetable, whenever they wanted. Now, nobody earns points for offering such a “basic” service. Instead, consumers want their mobile experience to be as simple and efficient as every other app they use.

IBM states it well: “The last best experience that anyone has somewhere becomes the minimum expectation for their next experience everywhere.” Digital-oriented companies like Uber, Netflix and Amazon know this; they have set the standard with efficient digital apps that easily navigate you to the screens you want where you can make choices or purchases in minimal time. Other consumer-facing businesses will have to keep up or they’ll dry up – and that includes banking.

As an industry built on meeting ordinary people’s financial needs, credit unions innately know the importance of offering quality member experiences – in any channel, including mobile. So, we’ve got this, right? Uh, maybe not.

In its research report, “The Digital Tipping Point,” management insights firm CEB explains that the increasing popularity of the digital marketplace isn’t because it’s where customers engage, but why they engage. CEB says now that convenience is a given, consumers want service providers that can help them achieve their goals: “Retail banks that recognize the importance of “moments of truth” are investing heavily to improve financial planning and to ease product purchase. Yet customers believe that the biggest barrier to achieving their goals is not the absence of a good planning document or of a new product, but rather their own daily behavior.”

What members want is a PFI not only responds to their obvious needs, but also can engage with them more meaningfully in areas like managing their finances. And the mobile platform may be the best way to do this. CEB notes that digital capabilities could help consumers say on track, perhaps by automating tasks they put off, like account reconciliation, or by showing them how daily decisions affect reaching a goal. Mobile banking is fast becoming a hard-to-differentiate commodity. But by adding specialty, interactive apps that can enhance the mobile experience, you also help members attain their goals.

Offering Useful Mobile Tools

At MEMBERS Development, we continually work with our owner credit unions to create or discover products and services that not only enhance members’ financial wellbeing, but also earn their loyalty. But before adding new services or complementary financial apps, you need to know more about your members, such as what they want to accomplish, how far they are from meeting their goals and how you can help. Our research has identified areas that are especially important to them:

  • Budgeting and reaching financial goals. Whether they aim to improve credit scores, save for the kids’ college education or prepare for retirement, members want their credit union to be a partner in helping them get there. Look into apps that offer financial-tracking or retirement readiness app, and make sure it helps them see progress toward their objectives. Ensure that information is presented in an easy-to-read format.
  • Simplifying money management. No one wants to be hit with late fees or painful account “surprises.” Apps that automate account reconcilement can help members avoid procrastinating. And automatic alerts for low balances or payments coming due can help cut stress. But also consider an app that lets them know when they’re over budget or moving away from their objectives
  • Loan-status tracking. It’s annoying to wait and wait for a loan approval. It’s even worse if you get stuck on hold trying to find out the status. Members would prefer a tool that tracks a loan application through each stage and lets you easily exchange documents or know what to expect next. That’s especially important when buying a home – a process some liken to waiting for spring.
  • Person-to-person payments. While we may not be the “cashless society” behavioral analysts predicted in the ‘80s, most of us rely on cash much less than in the past. But whether it’s ponying up for your share of dinner with friends or splitting the cost of a taxi ride, your members often need to pay back a friend or family member. Make it easy from your mobile app and they’ll find it harder to walk away from your credit union.

Meeting Rising Expectations

Digital channels like mobile banking aren’t only the way of the future – they’re today’s most popular choice. CEB’s research shows that first choice for 57% of retail bank customers is to bank via the digital channel; and 40% of customers prefer it exclusively. The costs of new technology can be steep, especially in the digital age. But at MDC, our owner credit unions have found collaborating with others can take away much of the burden – both in expenses and time. And offering members the right tools that can meet member expectations will keep members walking into your “virtual” branch years to come.

Kent Zimmer is director of finance for MEMBERS Development Company, a network of 40+ select, large credit unions that undertakes meaningful research and development projects that facilitate credit union growth.

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