This is the first time we've seen a financial services company reach out and congratulate users for a job well done. In this case, ING Direct's U.S. retail investments unit, ShareBuilder, sent a congratulatory email message to me after two months of investing through its Automatic Investment Program, which pulls money from outside checking accounts.  

The message has several purposes:

• To reinforce the investment decision
• To encourage customers to use ShareBuilder Research
• To incent users to move other brokerage accounts to ShareBuilder with the $100 bonus offer (see landing page, second screenshot)

Analysis
What's not to like here? It's timely, relevant, to-the-point (only 75 words in the main body copy) and makes users feel good about themselves. The same thing could be done with loan payments, debt reduction, savings account balance growth, and so on.

Email: ShareBuilder automated savings congratulations
(3 July 2009, 6:41 AM Pacific Time)

Landing page for $100-bonus offer
Note: The offer is co-branded with Wells Fargo, which is where I originally set up the ShareBuilder account eight or nine years ago.

Side note: Online account opening warning box
When looking at the new account application, we encountered this popup when attempting to leave the unfinished app and navigate to the ShareBuilder homepage (see note 1).  

Note:
1. For more info on the subject of online apps, see our Online Banking Report: Online Account Opening, published two weeks ago. 

As we've mentioned before, there are surprisingly few fee-based online financial services in the United States (see note 1). But things may be changing. In the past month we've looked at three innovative services charging fees:  

• Mercantile Bank of Michigan's Funds Manager, a $4.95/mo service that gives users a sneak peek at pending transactions, before they can cause an overdraft (previous post).
• LowerMyAssessment.com offers a $125 service to help consumers challenge their property tax assessment for their home (previous post).
• Home-Account charges $9.95/mo for its home-management service (based on a one-year commitment).

Today, we highlight a fourth new fee-based service, also charging $4.95/month (or more), vSafe from Wells Fargo. vSafe is a secure online storage solution that sells for $15 to $15 per months as follows:

• $4.95/mo for 1GB of storage
• $9.95/mo for 3GB of storage
• $14.95/mo for 6GB of storage

The service was introduced several months ago, and I've been using it for a couple months. The service automatically stores Wells Fargo statements, and allows users to upload any other file up to the storage limit. It would be even more useful if it offered automated retrieval and storage of other bank and biller statements.

Wells Fargo homepage (1 June 2009, 1:15 PM PDT)

Landing page (link, 1 June 2009)

Take a test drive in the Wells Fargo lab (link, 1 June 2009)

Interactive video highlighting benefits

Signup explanation

Notes:
1. The golden rule of consumerism: "You get what you pay for." Because online banking services are typically offered free of charge, U.S. consumers have had to contend with clunkier, slower, less secure and less feature-rich online services than consumers in other countries that pay for online access. Fees for online services can be a win-win, allowing financial institutions to offer premium online services for those willing and able to pay for them, while at the same time offering basic services free of charge so that everyone can benefit from online banking. 
2. Article updated 9 July 2009 to remove incorrect reference to Expensify's $4.95/mo fee (see comments).

TowerGroup has just released a new research note discussing the growing adoption of mobile banking in the United States. The research unit of MasterCard is predicting a five-fold increase in active users (note 1) between year-end 2009 and year-end 2013.

In comparison, we (note 2) are projecting a four-fold increase. But either way, it's a phenomenal growth curve reflecting a market that financial institutions must pay attention to.

Following are the numbers Tower released; more details are contained in the full report (purchase here). I also compared to those that we projected in our Jan 17 Online Banking Report.

Please note: TowerGroup forecasts active USERS; we forecast active HOUSEHOLDS. There are about 1.9 adults (18+) per household in the United States, but often, not all of the adults in the household are active banking users, so it's a bit hard to compare the two figures. But if you assume 1.2 to 1.4 mobile banking users per household (note 3), we are pretty close this year, but TowerGroup is a bit more bullish five years out.

Sources: Online Banking Report, Jan 2009; TowerGroup, May 2009

Notes:
1. Active mobile users have used the service within the past 90 days.
2. See our Online Banking Report: Mobile and Online Banking Forecast or the Online Banking Report: Banking on the iPhone for complete details.
3. We assume the number of mobile users per household will grow over time starting with 1.2 per household in 2009 to 1.4 per household in 2013.  

While reviewing M&I Bank's Metavante-powered online application for our latest report (note 1), I noticed the bank's Online Security Guarantee (first screenshot below).

It's important to post reassurances prominently on banking websites, especially on product application pages. It helps users overcome their security and trust fears and move forward with opening new accounts online. 

Often the explanations of guarantees are full of legalese and exceptions in the fine print, reducing their effectiveness. But M&I's does a good job with concise and easy-to-comprehend copy (see second screenshot).

Here are the four parts to the guarantee, taken directly from the website:

• Zero Liability Protection: You will not be responsible for any withdrawals which result from unauthorized online access to your personal M&I deposit accounts.
• Bill Payment Promise: If we fail to process a payment in accordance with your instructions, we will reimburse any late charges assessed by the payee.
• Security Commitment: We use data encryption to protect you when applying for accounts, conducting transactions or paying bills online.
• Privacy Protection: As further detailed in our Privacy Policy, we are committed to protecting your personal information.

M&I also includes a short section outlining the customer's responsibility to monitor their account and safeguard passwords.

We congratulate both the bank's product group, and its attorneys, for keeping legal language to a minimum . 

M&I Bank's Platinum Checking application (7 June 2009)

 M&I Bank's Online Guarantee page (link), 7 June 2099)

Note:
1. For more info, see Online Banking Report: Opening Accounts Online, published June 21, 2009.

Business runs in cycles and right now many of the large financial brand names are a bit tarnished. Over the next few years, we'll likely see community banks and credit unions turn up the volume on marketing campaigns emphasizing their low-key, low-risk community-based services.

We ran across this good example two weeks ago at $930-million (assets) Alpine Bank of Illinois. The bank uses a clever escape theme that should resonate with hard-core computer users and novices alike (see screenshot 1 below). The eye-catching banner sequence (see screenshot 1a) asks a serious of three questions, then culminates in an escape key (ESC) inviting users to click to a landing page with more info.  

Then on the landing page, the "Esc key" in the lower right (screenshot 2), takes users to an online Contact Me form (screenshot 3) that includes simple contact info to be used for a followup call or email (customer's choice). This is a nice high-touch alternative to regular online app, that can take 7 to 10 minutes to complete and are abandoned at alarmingly high rates (see note 1).  

Analysis: Overall, the campaign is clever and well presented (note 2). But the bank could make several landing-page changes (screenshot 2) to improve conversion rates: 

• Increase the visibility of the $25 account-opening bonus. It's currently buried in the first paragraph. I didn't even notice it until the third time we looked at the page (note 3).
• The account opening link on the landing page should be enhanced with one or more brightly colored Open Now button.
• While the "escape key" is clever, users may not realize that's how they are supposed to request more info. The bank should add a More Info button and/or add "more info" to the Esc key graphic.
• On the Contact Me form, their should be an Open Now button for users who decide they are ready to open immediately.

For more info on improving your online account opening results, see our latest Online Banking Report: Opening Accounts Online, published last week.

1. Homepage (16 June 2009)

1a. Homepage banner ads (they cycle through in this order)

2. Landing page (from homepage banner; link)

3. Contact Me form (link)

Notes:
1. For more info, see Online Banking Report: Opening Accounts Online, published last week.
2. One small nitpick on the design: The banner ads should only cycle one or two times per visit. There's no need to keep cycling the banner ads over and over, it's annoying for someone trying to find something on the homepage.
3. The $25 bonus does have a small banner on the homepage, lower right. But visitors attracted to the large escape banner could easily miss it.

Maintaining one of the highest rates in the country, currently 2.75% (see note 1), SmartyPig's deposits have grown ten-fold since January (see chart 1, below). And the company plans to continue its aggressive pricing and marketing, hoping to grow another five-fold to a half-billion by year-end (see chart 2, below) or 50x what they started the year with.

Deposits in the United States are held by part owner, Des Moines, Iowa-based West Bank. Australian deposits are held by SmartyPig partner ANZ Bank.

To help fund their growth objectives, SmartyPig announced today that Red McCombs, co-founder of Clear Channel Communications, has invested an undisclosed amount. McComb Enterprises lists one other financial services company in its portfolio, asset-based lender, Propel Financial Services.

Founder Jon Gaskell is pleased with the aspect of goal-based saving at SmartyPig. In an email yesterday he told me:

Of our customers who have reached a goal, more than 80% of them have started a new goal. The average SmartyPig goal length is nearly 4.5 years, and our average user is depositing a little more than $200 per month toward his or her goal. Fifteen months after launch, our data suggests that a vast majority of our customers are staying focused on their predetermined goals, and the deposits are "CD-like" in nature.

The half-billion-dollar question, assuming they meet their 2009 projection, is how sticky are the deposits when rates come down off the top of the chart?   

Chart 1: Actual deposit growth at SmartyPig

Chart 2: Expected deposit growth through Dec. 2009

Source: SmartyPig, 25 June 2009

SmartyPig homepage (24 June 2009)

Notes:
1. In Bank Deals weekly list of highest savings rates, SmartyPig was number one on June 20 at 3.05%. The rate was lowered on June 22 to its current 2.75%.

We just completed our latest Online Banking Report. It will be mailed to subscribers this week.
It's also available online here. There's no charge for current subscribers; others may access it immediately
for US$495.

---------------------------------------------------------

Improving Online Account Opening ROI
Ten strategies to increase online application conversion rates

102 pages (published 21 June 2009)

In this report (abstract PDF), we focus on ways to increase conversions and improve your results when opening financial accounts online or over a mobile phone.

The online application is the new branch new-accounts desk. And, just as you provide ongoing support, training and incentives to branch-based sales staff, you must continually fine-tune your online sales process.

In our experience, this is an area that needs attention at most financial institutions. Things have greatly improved during the 10+ years we've been tracking online applications. However, during the research for this report, we reached dead-ends at three of the 10 applications tested (note 1). That just can't happen.

The report outlines a 10-step approach to improving the process: 

• Direct users to the application
• Set expectations
• First things first
• Guide customers
• Bundle mobile access & alerts
• Upsell
• Fund
• Ask for referrals
• Stay in touch
• Humanize the process

We reviewed the online applications of the following companies:

• Bank of America
• BECU (powered by uMonitor)
• Capital One
• Chase Bank
• First Arkansas Bank & Trust (powered by FirstROI)
• Flagstar Bank (powered by uMonitor)
• HSBC Direct
• Huntington Direct (powered by CashEdge)
• M&I Bank
• National City
• Verity Credit Union (powered by Andera)
• Wells Fargo
• Zions Bank

Finally, a 10-year forecast for online account-opening volumes in the United States is presented.

M&I Bank has an attractive and informative application start page (9 June 2009)
Note: The online banking guarantee at the bottom is a good way to improve user trust.

Note:
1. Granted, user error was the problem in two of the three failed apps; however, we weren't purposely trying to make mistakes. The online application should have provided assistance in correcting them, rather than leaving us hanging.