Thursday, May 5, 2011

Banks Slow to Embrace Potential of Tablet Computing

One year ago yesterday, Apple announced it had shipped it's first million iPads. Since then, it sold 14 million more in 2010 and is expected to sell between 30 and 40 million units in 2011 despite supply challenges in Japan. New research from Gartner predicts that global tablet sales will increase from 17.6 million in 2010 to nearly 70 million in 2011 and close to 300 million by 2015. During this time, the average price should fall to about half of the current level, which is just under $500 for entry level models.

Given this growth trajectory, and with banks continuously touting their desire to 'enhance the customer experience', how has the industry completely fallen asleep at the developmental control switch when it come to leveraging the tablet computer for engaging the customer? Given the demographic profile of the early adopting tablet owner (higher income, technology savvy, business traveler), and the retention experience found with mobile banking, it is even more surprising that only a handful of banks have even introduced iPad banking applications.

According to a recent ranking of financial and banking iPad apps by Netbanker, there are only 7 banks ranked in the top 200 apps related to finance and only 2 banks (Chase at #9 and USAA at #20) ranked in the top 20. Chase was not only one of the first banks to develop a native iPad app (as opposed to a converted iPhone app), but they have leveraged the camera included on the iPad2 to facilitate their remote deposit capture service. USAA rebuilt their already industry leading iPhone application for the iPad, providing users with the ability to manage a wide range of financial transactions such as paying bills, transferring funds, placing trades, getting real-time stock quotes and viewing their USAA insurance policies. Members can also electronically add or replace a car on their policy, receive an electronic auto insurance ID card and receive free financial advice in the form of stories and videos customized for a unique iPad experience.

USAA iPad Financial Literacy Library

In the past week, Bank of America also introduced an iPad banking application that leverages the capabilities of tablet computing. Highlights of the new app include an enhanced bill pay calendar, a ledger format for showing account balances, some transactional enhancements and other functions that come closer to mimicking their online banking site as opposed to their mobile banking app. While not providing remote deposit capture capabilities within the iPad app, the app is already ranked in the top 50 in the finance category.

Another bank that was quick to introduce a native iPad banking application with enhanced functionality was BBVA Compass. According to Alex Carriles, SVP and director of mobile and internet strategies for BBVA, "One of the first goals that we had when we decided to develop something for the iPad was to avoid the mistake of looking at the iPad as a large iPhone".

The most noticeable difference between the bank's iPad app and its iPhone app is its appearance. The iPad app's display looks like a bound book with an image of a staple on the center of the page and the image of a ribbon separating different sections. There is a tool that lets customers scroll through images of cashed checks much like albums on iTunes and allows a customer to look at pie charts that illustrate distribution of funds in various accounts.

While a bit cumbersome for everyday transactions such as balance transfers, balance inquiries, and online bill pay, the larger, tactile screen and increased navigation are just perfect for Personal Financial Management (PFM) functions like self-serve wealth management, financial literacy and investing. Many of the more progressive investment firms such as TD Ameritrade and Charles Schwab have already developed robust apps that allow customers to conduct research and conduct more complex transations on the tablet.

In the same way that investment firms can use the enhanced capabilities of the tablet to illustrate charts, graphs and investment recommendations, banks could apply the same logic to engagement and cross-sell messaging and the building of financial dashboards specifically for the iPad. Comparison charts, links to third party financial service firms, illustration of rewards program benefits and even opportunity alerts are perfect for the tablet user. Another unique capability of the tablet is the ability to leverage high definition video or even face-to-face chat in the sales or relationship enhancement process. This provides for an excellent expansion into the small business and commercial customer space where financial advice can be delivered via either online or offline webcasts to executives on the go.

Based on a recent study by eMarketer, tablets provide the perfect online shoping experience where owners are both highly engaged as well as more captive than with smartphone applications.

So, what will it take for more banks to build native tablet banking applications that take advantage of the functionality of the tablet as opposed to trying to expand a mobile app or compress an online banking app onto a tablet? With the introduction of the Blackberry Playbook (with enhanced data security features), numerous Android supported tablets and other players entering the market, how can banks not allocate resources to provide their customers an enhanced experience?

As a avid user of my iPad, I am disappointed my bank has not moved beyond an already market leading online and mobile banking application to support my expanded expectations on my iPad. As was the case with mobile banking, the institution that is first to create the 'WOW' factor will grab the lion's share of the lucrative first adopter market that has already fallen in love with their tablet.

But, I want more than what traditional mobile banking applications can provide. I am looking for financial statistics, financial advice and financial management tools all provided in both an engaging and entertaining package. Kind of like Angry Birds for banking.

Maybe the yet to be introduced BankSimple or MovenBank will surprise me.


  1. Right now the iPad is dominating the tablet market. (See some recent stats here:,2817,2384908,00.asp)

    I agree with you that the tablet introduces another distinct device type for financial institutions to consider. The PC, mobile phone, and tablet each have unique characteristics.

    Creating and maintaining products in each space is both an opportunity and a challenge.

  2. I guess we should hope that banks try to build apps for all of the smart phone platforms first, then hope they move to the multiple platforms of tablets. Both channels have their advantages. One is more transactional, while the tablet is definitely more interactive from a knowledge perspective. Even for the banks that have apps, I don't think they have leveraged the HD visuals, tactile benefits and geolocational potential. As I said, I want an app that is both functional and engaging.