Connecting with Customers in the Digital Age: Taking Engagement to a New Level

[ D I GI TAL C H A N N ELS FO RUM]
Neff Hudson
Assistant Vice President, Emerging Channels
USAA Bank
Michael J. McEvoy
Managing Director
ath Power Consulting
Presented by:
Connecting with Customers in the Digital Age:
Taking Engagement to a New Level

Mobile Goes Mainstream:
Increasing Frequency of Contacts
How often do you use mobile banking?
48%
• The ‘audience’ is already there. Are banks there for them?
4%
14%
30%
21%
23%
8%
Multiple Times a Day
Daily
2-3 Times a Week
Once a Week
1-2 Times a Month
Less than Once a Month
Source: The 2013 ath Power Mobile Banking Study™

Consumers Already Doing the ‘Basics’
21%
23%
33%
36%
41%
47%
51%
61%
71%
86%
Transfer Funds Outside Bank
RDC
Check Credit Available
ATM / Branch Locator
Receive Account Alerts
Pay Bills
Check Cleared / Payment Received
Transfer Funds Inside Bank
View Recent Transactions
Check Balances
Please indicate the banking transactions you
conduct using your mobile device

Which of the following banking functions would you do on your
mobile device, were it a possibility?
Banks Can Cut Expenses, Improve Satisfaction
28%
29%
33%
42%
44%
44%
44%
46%
55%
Access Consolidated View of Accounts
Reset UserId / Password
Create and Track a Budget
P2P Payments
Mobile Payment at Merchant
Stop Payment
Activate Credit / Debit Card
Receive, Store Rewards Points
Report Lost / Stolen CardX
X
X

USAA Mobile by the Numbers
$7B
deposits
22%
monthly
penetration
334M
contacts
48%
transfers
5.5M
apps
Source: USAA 2012 usage statistics. USAA Mobile includes mobile.usaa.com, plus apps for iPhone, Android, iPad
20%
bills

Which mobile devices do you use to access your mobile banking account?
7%
37%
90%
Regular Cellphone
Tablet
Smartphone
Mobile is More than a Smartphone:
1 in 3 Using Tablet to Access Mobile Banking:

Do you typically use your Tablet only at
home, or do you often take it with you
when you leave home?
It Varies
22%
Generally Bring it
with Me
23%
Mainly Home
Use
55%
Tablet Use Mostly Occurs at Home:
Implications for Desired, Useful Functionality

Tablet Banking: Your Next Sales Channel?
• Rich Media
• Real Advice
• Tap to Transact
Screenshot: USAA App for iPad

How likely would you be to switch banks if you found another bank with a
superior mobile banking offering?
22%
9%
35%
35%
0% 10% 20% 30% 40% 50% 60%
Unlikel
y
Likely
Very Somewhat
Challenge: Almost 1 in 2 Mobile Users Will Consider
Switching to a Bank with ‘Better’ Mobile Banking

Using your mobile phone or tablet, have you done any of
the following in the past 12 months?
36%
38%
39%
39%
52%
63%
Made Purchases Through a Mobile App.
Made Purchases Through a Mobile
Website
Researched Product on Mobile Device
and Purchased In-Store
and Purchased Online Using Computer
In-Store Price Comparison
Challenge: Mobile Becoming “End–to-End” Solution in
Mind of Consumer: Are Banks Missing Out?
• Growing proportion of Google searches starting through mobile
• Consumers seeing mobile as end-to-end solution

1%
26%
27%
28%
35%
39%
Other
Credit Card Companies
Retailers
Banks
Smartphone Manufacturers
Software / Technology Firms
Challenge: Consumers, Technology Firms, Not
Banks, are Driving Innovation and Industry Direction
Who do you think is most likely to develop next
generation payment solutions?
• Gap between industry focus and customer interests / behaviors?
• American Banker ‘Innovator of the Year 2012’: founder of Square
• Future competitors from outside the industry – Simple, Movenbank?

Center of Gravity: Geolocation

Center of Gravity: Voice-based Assistants
• Example: USAA Virtual Assistant – Nuance and USAA

Center of Gravity: Imaging - RDC 3.0
• Example: USAA Video Capture, Augmented Reality

Using your mobile phone or tablet, have you done any
of the following in the past 12 months?
11%
12%
32%
47%
57%
Made Charitable Donation via Text Message
Received Money From Another Person
Transferred Money Directly to Another
Person's Bank, Credit Card or PayPal Account
Paid Bills Using Mobile
Made Online Purchases
Center of Gravity: Payments
Connecting the Virtual and the Physical

How likely do you think it is that
mobile contactless payments will
become a major form of payment
in the next 3 years?Very Likely
28%
Likely
49%
Unlikely
18%
Very Unlikely
5%
Almost 80 Percent Think “Contactless” Payments Will
Become Common Within 3 Years
• Consumers accept “contactless” payments are on the way – do banks?
• What role will banks play?

If offered the option of using a
“contactless” payment service, how likely
would you be to use it?
I Already Use It
6%
Very Likely
25%
Likely
36%
Unlikely
20%
Very Unlikely
13%
Strong Majority Would Use
‘Contactless’ Payments Option, if Offered

So Who’s (arguably) Winning the Race?
Source: https://www.thepaypalblog.com/2011/09/paypal-unveils-the-future-of-shopping/

Takeaways
Mobile Has Gone Mainstream
Innovation is Expected
“Hang Together, or Hang Separately”
• Interoperability
– Person-2-Person Payments
– Mobile Wallets
• Customer Focus
– Account Switching
– Advice
“End of the Beginning”

[ D I GI TAL C H A N N ELS FO RUM]
Neff Hudson
Assistant Vice President, Emerging Channels
USAA Bank
Michael J. McEvoy
Managing Director
ath Power Consulting
Presented by:
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Connecting with Customers in the Digital Age: Taking Engagement to a New Level

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