What Will 2012 Bring for the Banking Industry?

As we wrap up 2011 and head into the New Year, we asked some of our readers to share their thoughts on the banking industry in 2012. This past year has been filled with mobile and tablet innovation, but will that carry on in 2012? How will social media impact financial institutions in the next year? Here’s what the experts are saying:

  • “Of those banks that are currently using social media as a channel to communicate with their customers, much of the focus has been on appealing to Gen X and Gen Y customers,” says Karen Licker, Financial Consultant & Social Banker (Independent) for J.D. Power and Associates. “Clearly Gen X and Gen Y customers comprise the majority of those subscribing to and using social media, but the number of Pre-Boomers and Boomers who do so as well is growing at a considerable rate.  In addition, Based on J.D. Power’s 2011 Retail Satisfaction Survey, nearly one in five Gen X and Gen Y customers state that they are likely to utilize social media for banking-related topics in the future, and more than one in 10 Pre-Boomer and Boomer customers are likely to do the same.  Banks should be prepared to interact with and satisfy the growing Pre-Boomer and Boomer customers too!” *see Chart 1 below
  • “2012 will finally see the tipping point for mobile banking. Mobile moves beyond today’s limited functionality and starts to become the primary remote customer channel. Look for some interesting corporate bedfellows to emerge as the financial services ecosystem starts validating mobile payment business models and the importance of controlling new methods of money transfers and payments. We will see continued disruption in the space, as it relates to payments, security protocols, features like proximity rewards, integrated p2p and a2a with social tether, account opening, and more. Expect feature rich device agnostic applications that enhance usability and user experience across a range of mobile and tablet devices.” Bradley G. Leimer, Vice President, Online and Mobile Strategy at Mechanics Bank (@leimer)
  • “2012 will be the year of improved customer lifecycle management. With the fees and interest margins associated with accounts falling, there is a need to acquire a new customer more efficiently, onboard each new customer more effectively, achieve a higher level of relationship engagement and gain a greater share of wallet. Financial organizations will also need to focus more resources on retaining current clients since replacing these households has become so expensive.”  Jim Marous, Senior Director, Marketing Services, Harland Clarke (@JimMarous)
  • “In the credit card space, service alerts have steadily grown in importance over the last few years,” says Michael Beird, Director of Banking Services for J.D. Power and Associates. “Based on J.D. Power’s 2011 Credit Card Satisfaction Study, cardholder satisfaction increases by 98 index points (on a 1,000-point scale) when service alerts are offered and used. Email (80%) is the most common form of service alert, and is followed by phone calls (23%); text messages (15%); and secure online messages (8%). Interestingly, secure online messaging is the lowest-used service alert feature, but it results in the highest satisfaction (783). While issuers still have to do a better job of informing their customers about the availability of the service, it’s clear that customers are seeking ongoing and proactive communication from their banks. Informing customers of status issues and concerns in real time, via text, email or secure online, is an emerging service that will likely grow exponentially in the year ahead.” *see Chart 2 below

What do you think 2012 will bring for the banking and financial services industries? Leave us a comment below or Tweet @bankingdotcom.

*Chart 1

 

 

 

 

 

 

 

 

 

 

 

 

 

© 2011 J.D. Power and Associates Retail Banking Satisfaction Study, The McGraw-Hill Companies, Inc. All Rights Reserved.

*Chart 2

 

 

 

 

 

 

 

 

 

© 2011 J.D. Power and Associates Credit Card Satisfaction Study, The McGraw-Hill Companies, Inc. All Rights Reserved.

Comments

  1. Anjani Kumar says:

    In today’s global banking environment, growth is muted, cost is high and there is high pressure on revenue. So I agree, in 2012, banks will focus on more interactions with Pre-Boomer and Boomer customers through social media, on improving customer lifecycle management, and on improvements in service alerts in the cards space. In addition, mobile banking would see paradigm shift. I also see the following focus areas of consumer banks in 2012:
    • Leveraging Cloud Computing technology and solutions
    • Leveraging Analytics for customer segmentation, cross and up-selling, building loyalty etc.
    • Delivering end-to-end customer experience through seamless multichannel experience
    • Working across the banks’ organizational boundaries to provide seamless and enhanced customer experience
    • Customer centricity and delivering tailored services and products offerings
    • Improving the customers’ online banking experience

    Anjani Kumar (Principal Consultant, InfosysLimited)

  2. Jeff Marsico says:

    Bank regulators will require banks to develop capital plans that include the bank’s own assessment of what their minimum capital ratios should be. The results of the assessment will end up being what the regulators perceive as “well capitalized”.

    ~ Jeff Marsico

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