This Is Not Your Father's Banking Business

The banking business is changing in ways no one would have predicted a few short years ago.

Of course, banks are going through credit market collapses, a period of threatened recession and economic jitters. But even so they continue to invest in their Web sites, adding more online products, services and transactions.

In fact, the fundamental changes bank marketers are instituting online may be ultimately more far-reaching and lasting than today's headline-grabbing events.

Given consumers' concerns about security and privacy, banks are understandably cautious when it comes to tapping into the marketing and community-building potential of social networks, blogs, instant messaging and other Web 2.0 platforms. Most banks have adopted a wait-and-see approach regarding using new media for promoting products, offering client services and engaging in customer interactions.

Nevertheless, the first signs of change are evident.

A full 53% of all US adult Internet users, equivalent to 39% of the total US adult population, were already banking online as of September 2007, according to the Pew Internet & American Life Project "Online Shopping" report.

In addition, banks are beginning to offer mobile services.

According to Javelin Strategy and Research, approximately 6% of US adults had access to mobile banking services at the end of 2007.

Aite Group projects that the number of US consumers using mobile banking services will grow from 9.5 million in 2008 to 35 million by 2010.

As more consumers incorporate online and mobile banking and bill paying into their lives, more banks are experimenting with Web 2.0 services, such as social networks and blogs, video and even interactive games. They are looking at interactive tools and applications to encourage consumers to opt in to various offers, sign up for more information, enroll in new services, and take quizzes or qualify for product promotions.

In short, banks want to deepen their relationships with consumers by engaging them online.

To see what lies ahead for banking, download the new eMarketer report, Bank Marketing Online: Moving into Prime Position, today.