Marketing Financial Services Is Set for Major Changes in 2012

Financial services play a very important role in the economy of a place simply because this is a set of businesses that manage money. These institutions include banks, credit unions, insurance companies, credit card companies and any other institution that is in the business of managing money. 2012 is a year that has immense financial opportunities for a financial service company with the right marketing strategy and plan. Financial marketing services need to have proper and real solutions to counter present challenges while making use of the available resources and at the same time minimizing on unnecessary costs.

One of the greatest features and elements that played a major role in marketing financial services during the past year was ICT and mobile telephone services. This is an area that needs to be tapped into again during this year. The internet and mobile phones have brought so many service and goods closer home which is an advantage to consumers and created a wide international market to the existing financial service businesses including other business too. This is an area that needs to be tapped into more due to the available resources. Mobile phones that are internet enabled ensure that information is passed on whenever and wherever.

One of the greatest breakthroughs in marketing financial services is market research. Research plays a very integral role in planning the success of any business. Hence helps a business realize the markets mindset through which a great business plans is created. Financial services need to take advantage of research in order for them to create new ways in which to satisfy their clients' needs, maintain the existing client, plan to increase their niche market and at the same time come up with ways in which they can increase their presence in the market.

Financial marketing services will see to it that businesses make use of the tough economic situations to ensure that they have a solution for the existing challenges that the market is facing. Once the research is done, financial institutions need to ensure that they are communicating what the clients need to hear so as to be at purr with them. This creates an understanding under which the client will see the need of using the financial solution that a financial institution has to offer and at the same ensure that the business has all the necessary tools to meet the same. A winning financial service marketing plan is one that is client driven, offers quality service and at the same time promises client satisfaction.

Mobile Financial Services (MFS): The Unrealized Potential

Overview

This trend currently is growing at a very fast rate and is said to reach 1 billion people by the end of year 2015. According to Berg Insight, an insight agency, in April 2010 estimated that users of m-banking and related services (including money transfers) almost doubled between 2008 and 2009 to 55 million, and also stated that it will double again in 2010.

In 2015 there will be 894 million users globally. This growth is mainly being driven by efforts of operators and banks in developing countries (particularly in the Asia region) to bank the unbanked. Global Industry Analysts (GIA) in February 2010 predicted the global customer base for m-banking will reach 1.1 billion by the year 2015 whilst ABI Research in January 2009 forecasted that in 2013, there will be nearly half a billion customers of MFS.

Defined

Mobile banking is an emerging convenient solution for customers with existing bank accounts to get connected to their bank or financial institution over the mobile network. This includes a standard banking that is to check summaries, transactions, balance, and credit as well as debit card management, and a whole new array of emerging conventional banking services

M-wallet on the other hand is of course a solution also adapted to unbanked customers. It provides the unbanked customers with an access to financial services via a mobile wallet (store value account).

Mobile payment enables customers to make credit card payments and bill payments any time anywhere, from either a bank account or a mobile wallet.

Mobile money in where transferring money through the usage of international or national remittance hubs from and/or to a real bank account or a mobile wallet (e.g. peer-to-peer).

Banking the unbanked

According to Pavola and Nokia, with more than 4.6 billion people globally already using a mobile phone and less than 2 billion people having a bank account (out of a world population of 6.8 billion), it's clear that a larger populations is left without bank accounts mostly being in developing economies. Being able to do transactions in a secured way, as well as from anywhere in the world, is a key part for people's life as it enables them to build and grow their own life and business.

This is where mobile wallets (m-wallets) come into play as it meets the needs of cellular customer who don't have a bank account for themselves. In Indonesia for instance, there are only 40 million banking customers but there are 160 million mobile-phone subscribers. Of all mobile financial services (MFS), the one with the biggest potential is remittance services, particularly the sending of cash from abroad according to statistics of Putra and Indosat

Mobile will play a significant part in the quest to provide banking or banking-like services to those at the bottom of the pyramid. Mobile is fairly simple to understand and roll out; it's also cheaper and more accessible to everyone according to Avendano/GXI

Realizing the potential

Banks and other financial institutions throughout the globe are now realizing the added values, improved customer convenience, speed of information availability and cost savings resulting from mobile integration of consumer and enterprise services.

These simple notifications services which are available to customers not only improves customer satisfaction levels but also results in savings for banks as customers do not call centers or walk into bank branches for such routine information thus saving the traffic by minimizing it - be green, be responsible. It's almost the moment to cut as much as things possible that is confusing the customers - it's much better to be simple.

As stated by Abraham Punnoose, vice president at Roamware, San Jose, CA "The trends are about empowering customers with real-time advisory notifications about transactions on their financial services and the capability of transacting their accounts on the move".

"For example, the ability of paying a utility bill via a mobile connecting using one's mobile banking service provides customers the ability of being in control even while on the move without Internet access," he said.

Security and threats

Along with the increasing usage of mobile financial services, there is an increase in mobile fraud. Customers are reluctant, and are worried about carrying out transactions over the mobile - this is the challenge that the mobile network operators (MNOs) need to work out closely with the financial institutions. Despite this, organizations such as Gemalto, a world leader in digital security has developed the most secure and comprehensive Mobile Financial solutions in the market.

Benefits to the banking and financial institutions

This will strengthen customer loyalty by offering new and better services by attracting new customers to one-on-one bank-customer relationship, expanding the institution's brand presence in the marketplace, extend the bank's reach by turning cell phones into ATMs, increasing market presence using new, flexible and ubiquitous channels, reducing the cost of direct teller interactions while maintaining the level of high quality service, increasing usage through availability, providing 24/7 services, creating direct marketing channels and also creating new revenue sources by offering new transaction.

Benefits to Mobile Network Operators (MNO's)
These increases the provider's brand presence attracting new customers and churn by strengthening customer loyalty levels through better service offerings, increases ARPU (Average revenue per user) by opening up new revenue streams and boosting the usage levels of the network, widens the provider's services portfolio, providing subscribers with instant access to airtime purchase. This also increases the cost-benefit ratio by reducing per-service costs, and overall it allows Mobile Network Operators in playing a leading role in the convergence of services and breakthrough technology

Conclusion

Asia-Pacific is by far expected to become the most important regional market, accounting for more than half of the total user base. Furthermore by 2015, Berg Insight forecasts that mobile banking will attract 115 million users in Europe and 86 million users in North America. "The global number of mobile banking users more than doubled between 2008 and 2009, and is expected to almost double again in 2010. Mobile handsets are in an excellent position to become the primary digital channel for providers of banking and related financial services on emerging markets," said Marcus Persson, Telecom Analyst at Berg Insight. It's time up for marketers across banking and financial services, telecommunication sector as well as mobile payment entities to realize the potential it holds and leverage this opportunity before it's too late.

The Impact of IT Solutions on Financial Services

Software applications have been explored in a wide range of activity domains significantly simplifying the workflow, however this advancement has taken a particular sphere of interest to the uttermost, more precisely, financial service companies. This division has experienced a tremendous expansion simply because online solutions perfectly match the basic functional principles governing all financial transactions. All three main segments: capital management, banking, and insurance, have taking advantage of large-scale implementation. In essence, the major change relies on the fact that traditional transaction methods have been successfully replaced by truly advanced computer-based and web-based applications.

The classic approach has undergone major transformations due to the fact that initial means have been optimized to enable transactions in real time. Besides this facet, IT solutions in the financial services field, have opened the path for new services. For instance, financial services technology has set higher standards in the financial world, as experts confirm the fact that instant access and secure financial procedures can be adjusted to the global evolution of the financial market. Without going into detail, financial service technology has literally set in motion the overall activity of the financial market, and every single branch has taken advantage of easy-to-use financial software applications. Firstly, these advanced tools have set the basis for full control over financial instruments enabling faster transactions. We all know that online approach has refashioned the entire financial service industry because this service has broken physical and temporal barriers. Therefore, we can access services from anywhere in the world as long as we have an Internet connection.

For many years now, financial operations and, implicitly financial services, have been considered a sophisticated process, as, these days, a click may synthesize all complicated procedures on the condition that we make decisions. All financial services departments have experienced this ascending trend based on ultimate technology. At first, we may assume that such platforms help professionals streamline their entire activity, however, by taking over demanding operations, experts have the opportunity to focus on the strategies they should develop to reach higher performance standards.

To sum up, financial solutions rely today on advanced software applications and the emphasis still falls on the integrated services, as the financial sector is extremely volatile and permissive regarding financial operations. Moreover, customers prefer a provider who can take care of all their needs when IT comes to financing. Thus, we are very likely to witness for the years to come innovative solutions that might take the financial market to a higher level.