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Innovations in Banking - US - November 2014

Published By :

Mintel

Published Date : Nov 2014

Category :

Banking

No. of Pages : 123 Pages

Innovation comes in many forms, including products and services customers can see and internal changes that can improve operational efficiencies and profitability. While they may not be able to address everything at the same time, banks need to continue to push the innovation envelope, not only because that’s what their competitors are doing, but because it is what consumers want.
Table of Content

Scope and Themes

What you need to know
Data sources
Consumer survey data
Direct marketing creative
Abbreviations and terms
Abbreviations
Terms

Executive Summary

Market drivers
The number of young people is growing
Figure 1: US population growth, 2009, 2014, 2019, by generation
Growth of mobile technology ownership
Banks are closing branches
Figure 2: Number of offices (including branches) of FDIC-insured savings and commercial banks, June 30, 2005-14
Leaders
Online-only banks
Mobile banks
Branch innovators
Communication innovation
The consumer
The majority of consumers still use a traditional bank for their checking accounts…
Figure 3: Checking account ownership, by age, September 2014
and savings accounts
Figure 4: Savings account ownership, by age, September 2014
Mobile banking apps appeal more to men than to women
Figure 5: Downloaded mobile app, by gender, September 2014
Most people want more security
Figure 6: Interest in banking products/services, September 2014
Innovation may win young customers
Figure 7: Attitudes toward banking innovations, by age, September 2014
What we think

Issues and Implications

Where are the opportunities for innovation in the banking industry?
Issues
Implications
How can innovation help banks ensure the relevance of branches?
Issues
Implications

Trend Application

Inspire Trend: Transumers
Inspire Trend: Click and Connect

Market Drivers

Key points
Number of young people is increasing
Figure 8: US population by generation, 2009, 2014, 2019
Growth of mobile technology ownership
Banks are closing branches
Figure 9: Number of offices (including branches) of FDIC-insured savings and commercial banks, June 30, 2005-14

Competitive Context

Key points
Nontraditional bank options
Online-only banks
Capital One 360
Ally Bank
Mobile banks
Simple
Moven
Walmart/GoBank

Customer Satisfaction with Innovation

Key point
Banks are already meeting many needs
Most people are satisfied with what their bank provides

Innovations and Innovators

Key points
Mobile bill pay
Figure 10: US Bank mobile bill pay online ad, 2013
Figure 11: US Bank electronic bill pay direct mail ad, 2013
Figure 12: US Bank mobile bill pay email ad, 2013
Umpqua Bank’s branch design
Checkless checking accounts
Innovative partnership with Apple
Apple Pay marketing
Figure 13: Bank of America Apple Pay email, 2014
Figure 14: Wells Fargo Apple Pay email, 2014
Figure 15: Citibank Apple Pay email, 2014
Innovations in financial literacy education
Union Bank Yuby
BBVA Compass
Bank of America
Figure 16: Bank of America/Khan Academy television commercial
TD Bank WOW!Zone
Capital One

Marketing Strategies

Overview
Ally Bank
Figure 17: Brand analysis: Ally Bank
Online initiatives
Figure 18: Ally Bank Discovering Retirement video
Figure 19: Ally Bank “Behind the Scenes with Kiplinger: Building Wealth the Old-Fashioned Way” video
Online ads
Figure 20: Ally Bank savings account online ad, 2014
Figure 21: Ally Bank online customer service ad, 2014
Mobile
Figure 22: Ally Bank No Branch Mobile ad, 2014
Direct mail
Figure 23: Ally Bank Raise Your Rate CD direct mail ad, 2013
Email
Figure 24: Ally Bank savings account email, 2014
Print
Figure 25: Ally Bank branding print ad, 2014
Television
Figure 26: Ally Bank New Things television ad, 2014
Figure 27: Ally Bank Raise Your Rate CD television ad, 2014
Capital One 360
Figure 28: Brand Analysis: Capital One 360
Online initiatives
Figure 29: Capital One 360 checking account video
Figure 30: Capital One 360 “How to do Person2Person transfers” video
Online ads
Figure 31: Capital One 360 Fee-Free Party Online ad, 2013
Mobile
Figure 32: Capital One mobile deposit mobile ad, 2013
Figure 33: Capital One 360 savings account mobile ad, 2013
Direct mail
Figure 34: Capital One 360 checking account direct mail ad, 2013

Account Ownership

Key points
Any account owned
Figure 35: Account ownership, any type, September 2014
Checking account ownership
Traditional banks still control the checking account market
Figure 36: Checking account ownership, by gender, September 2014
Online-only banks are most popular nontraditional option
Figure 37: Checking account ownership, by age, September 2014
Almost all with highest income use traditional banks
Figure 38: Checking account ownership, by household income, September 2014
Asians are less likely than others to use a credit union
Figure 39: Checking account ownership, by race/Hispanic origin, September 2014
Savings account ownership
More people use alternatives for savings accounts
Figure 40: Savings account ownership, by gender, September 2014
One quarter of 55+ use credit unions for their savings
Figure 41: Savings account ownership, by age, September 2014
Credit unions and online-only banks are equally attractive to those with higher household incomes
Figure 42: Savings account ownership, by household income, September 2014
Hispanics are more likely than non-Hispanics to use less traditional options for savings accounts
Figure 43: Savings account ownership, by race/Hispanic origin, September 2014

Type of Product Owned

Key points
Men are more likely to own a variety of financial products
Figure 44: Type of product owned, by gender, September 2014
Owning financial products competes with other priorities
Figure 45: Type of product owned, by age, September 2014

Mobile App Downloaded

Key points
Men use mobile banking apps far more than do women
Figure 46: Downloaded mobile app, by gender, September 2014
Millennials are much more likely to have mobile banking apps on phones than on tablets
Figure 47: Downloaded mobile app, by generation, September 2014
Use of mobile phone apps decreases after household income reaches $100K
Figure 48: Downloaded mobile app, by household income, September 2014

Interest in Banking Products and Services

Key points
Security is of most concern
Figure 49: Interest in banking products/services, September 2014
Already use
Men use more services than women
Figure 50: Interest in banking products/services – Already use, by gender, September 2014
Millennials are the target market
Figure 51: Interest in banking products/services – Already use, by age, September 2014
Higher-income households use more features
Figure 52: Interest in banking products/services – Already use, by household income, September 2014
Don’t use but would be interested in using
Men want it to be easier to connect with their bank
Figure 53: Interest in banking products/services – Don’t use but would be interested in using, by gender, September 2014
There is more opportunity among younger consumers
Figure 54: Interest in banking products/services – Don’t use but would be interested in using, by age, September 2014
Interest in new features
Interest is highest among those with checking accounts at alternative banks
Figure 55: Interest in banking products/services – Any interested, by checking account ownership, September 2014
Figure 56: Interest in banking products/services – Any interested, by checking account ownership, September 2014
The pattern is similar for savings accounts
Figure 57: Interest in banking products/services – Any interested, by savings account ownership, September 2014
Figure 58: Interest in banking products/services – Any interested, by savings account ownership, September 2014
Qualitative interest
Responses about security-based innovations (A and C):
Responses about advanced banking activities (B):
Responses about using branch-based technology (D):

Attitudes toward Banking Innovations

Key points
Half do most banking online
Figure 59: Attitudes toward banking innovations, by gender, September 2014
Innovation may win young customers
Figure 60: Attitudes toward banking innovations, by age, September 2014

Comfort Using New Products and Services

Key points
Women may need to try new features before they are comfortable
Figure 61: How comfortable using new products/services – Any comfortable, by gender, September 2014
Millennials are most comfortable with advanced ATMs
Figure 62: How comfortable using new products/services – Any comfortable, by age, September 2014

Appendix – Other Useful Consumer Tables

Checking account ownership
Figure 63: Checking account ownership, by generations, September 2014
Savings account ownership
Figure 64: Savings account ownership, by generations, September 2014
Type of product owned
Figure 65: Type of product owned, by household income, September 2014
Figure 66: Type of product owned, by race/Hispanic origin, September 2014
Mobile app downloaded
Figure 67: Downloaded mobile app, by age, September 2014
Figure 68: Downloaded mobile app, by gender and age, September 2014
Figure 69: Downloaded mobile app, by race/Hispanic origin, September 2014
Figure 70: Downloaded mobile app, by household size, September 2014
Interest in banking products and services
Any interest
Figure 71: Interest in banking products/services – Any interested, by gender, September 2014
Figure 72: Interest in banking products/services – Any interested, by age, September 2014
Figure 73: Interest in banking products/services – Any interested, by gender and age, September 2014
Figure 74: Interest in banking products/services – Any interested, by household income, September 2014
Figure 75: Interest in banking products/services – Any interested, by race/Hispanic origin, September 2014
Already use
Figure 76: Interest in banking products/services – Already use, by race/Hispanic origin, September 2014
Figure 77: Interest in banking products/services – Already use, by generations, September 2014
Don’t use but would be interested in using
Figure 78: Interest in banking products/services – Don’t use but would be interested in using, by household income, September 2014
Figure 79: Interest in banking products/services – Don’t use but would be interested in using, by generations, September 2014
Attitude toward banking innovation
Figure 80: Attitudes toward banking innovations, by household income, September 2014
How comfortable using new products and services
Figure 81: How comfortable using new products/services – Any comfortable, by household income, September 2014
Figure 82: How comfortable using new products/services – Any comfortable, by race/Hispanic origin, September 2014
Figure 83: How comfortable using new products/services – Any comfortable, by household size, September 2014

Appendix – Trade Associations

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